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Sunday, 20 June 10
OUR COAL: ITS DEVELOPMENT AND CONTROVERSIAL ISSUES
 Indonesia’s production of coal has been growing amazingly. In the mid 1980s, national coal production was less than 1 million tons per annum, whereas energy planners (in the fourth Five Year Development Plan: 1989-1994) pointed at 10 million tons as the national production target.
The current production has jumped dramatically, recorded as 237 million tons in 2008 (predicted to achieve 270 million tons this year), making Indonesia a world class producer and the largest exporter of coal around the globe. The skyrocketing growth of our coal production has also incited many controversial issues.
Coal is considered as the dirtiest among fossil fuels, making environmentalists oppose their wide use
as fuel.
However, the proposal for ceasing use of coal — power generation, for instance — would be challenged by power utilities demanding low cost fuel that coal may offer and by the government, which has the responsibility to provide electricity as well as have revenue from exploiting its energy resources.
Despite the world’s rising anxiety of global warming, IEA (International Energy Agency: World Energy Outlook 2009) statistics shows that the world consumption for coal, for the last decade, is still growing the fastest among primary energy sources.
The environmental problem associated with coal in Indonesia is not limited to green houses gases (GHG), but also damage and pollution since its exploitation, transportation and uses to post mining.
It is easy to find where many coal fields are not mined appropriately according to “good mining and environmental practices”, coal transportation is not considering safety standards and is damaging rivers, (public) roads and seashores.
The coal mining has polluted the land, water and air of especially Kalimantan, where more than 90 percent of Indonesia’s coal mining operations take place.
It is sad that many of the previous mining areas have been abandoned without being properly reclaimed, whereas thousands of hectares of the island’s tropical forests have been converted into desert.
The soaring exploitation, including its negative impact on the environment, has a strong correlation with the number of licensing/permits awarded.
The introduction of the 1999 Regional Autonomy Law, subsequently followed by the 1999 Fiscal Balancing Law between the Central and Regional Governments have — to some degree — impacted on the coal licensing regime, where larger authorities had been given to regional/local governments.
Under the new licensing regime by local governments, requirements for coal permits tend to be relaxed whereas monitoring has not been done properly.
As a result, the number of permits (Mining Authorization/KP) has been growing considerably (currently 462, of which 169 are producing), coal production increases, but also environmental problems and the issues of illegal mining exist.
The question of who really owns the KP licenses exists, which was defined as that it can be owned by Indonesian national/companies only.
While the largest part of coal in Indonesia are being produced by large companies (the holders of Coal Contract of Work/PKP2B), some coal is mined by small scale and illegal miners.
It is believed that a significant amount of coal has been produced by illegal miners (some 5 million tons annually) and part has gone to meet export demand.
Wherever in the world, illegal miners lack interest in responsible mining and mine rehabilitation practices. Illegal mining is a problem for potential investors, the environment and government revenues.
The government has introduced measures to crack down on problems, including arresting illegal miners.
However, it cannot be the only solution since illegal mining is actually rooted in underemployment, local poverty and weak law enforcement, while the number of people involved in these activities is quite significant.
An alternative to confrontation to illegal miners by the central government (who awards the large scale PKP2B mining license) should be a cooperative and more comprehensive approach.
“Despite the world’s anxiety of global warming, IEA statistics shows that the world consumption for coal is still growing the fastest among primary energy sources.”
Work together with local/rural governments and communities to reduce poverty, educate/assist the illegal miners to increase their awareness on good mining practices (including mine rehabilitation), provide transition period fiscal incentives to encourage illegal mining toward the regulated mining sector, among others.
It needs to maintain an appropriate balance between the soaring exports of coal (about three quarters of production on average) and the domestic growing demand for the same fuel.
Push for exports is still coming largely from the traditional East Asians (Japan is the largest), while the coal-hungry India and China are also increasing their demand for our coal.
The exports will be competed with by the Blue Print for Energy Management 2005-2025 pointing out that one third of Indonesia’s energy primary energy mix in 2025 is to be supplied by coal, (the current share is about 15 percent).
Even though it is often mentioned that our coal reserves are quite large (current proven reserves of 5.5 billion tons; estimated resources of 105 tones) and that our reserves for coal are much larger than that of oil and gas, we should watch their fast rate of exploitation cautiously.
It needs to recalculate the benefit of exploiting them, taking into account their damage to the environment and what is left post mining. Where have all the revenues from exploiting that coal gone? Is the escalating export not jeopardizing the domestic energy security in the near future?
We have ample experiences, for instance in exploiting the resources-rich Kalimantan. The forests, oil and gas reserves have been exploited for about four to five decades, but it seems that the island has not enjoyed the fruits of the excessive exploitation: the current regional economy remains weak, infrastructure is poor and energy supplies for local uses have not been secured.
It needs to promote the terms “resources balance, depletion, sustainability”, start internalizing the costs of environmental impact and enforce those concepts into workable policies for our coal mining development.
The writer is the senior energy planner and an economist with the National Development Planning Agency. The opinions expressed are his own.
Source: The Jakarta Post ( Hanan Nugroho)
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Friday, 28 October 11
RISING COAL PRICES TO WORSEN CHINA'S WINTER POWER CRUNCH - CRI ENGLISH
CRI English reported that, the rising price of coal is fueling concerns about a power crunch set to plague China this winter, analysts said.
The ...
Thursday, 27 October 11
CAPESIZE REACHING NEW HIGHS - FEARNLEYS
Handy
Pacific market has mixed sentiments with tonnages fixed at firm levels and some tonnages in feast failing on subs.For indo-india, large eco ...
Thursday, 27 October 11
DRY BULK MARKET EDGES DOWN AS CHINAS IRON ORE DEMAND LOSES GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A plunge in Chinese iron ore demand, as a result of high steel inventories and a bleak outlook regarding steel prices, has prompted the dry bulk mar ...
Thursday, 27 October 11
BUKIT ASAM 3Q PROFIT SURGES 66.91%
Insider Stories reported that, the state-controlled coal miner PT Bukit Asam Tbk (PTBA) experienced a 66.91% increase in its net profit during a per ...
Wednesday, 26 October 11
MOODYS SEES MORE GROWTH FOR INDONESIAN COAL MINERS - THE JAKARTA GLOBE
The Jakarta Globe reported that, Indonesia’s coal mining industry looks set to grow despite an uncertain global economic outlook, according to ...
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- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Coalindo Energy - Indonesia
- Power Finance Corporation Ltd., India
- Larsen & Toubro Limited - India
- Sakthi Sugars Limited - India
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- South Luzon Thermal Energy Corporation
- Directorate General of MIneral and Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Parliament of New Zealand
- Bayan Resources Tbk. - Indonesia
- Energy Development Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Renaissance Capital - South Africa
- Ministry of Mines - Canada
- Kapuas Tunggal Persada - Indonesia
- Sindya Power Generating Company Private Ltd
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Deloitte Consulting - India
- Aditya Birla Group - India
- Romanian Commodities Exchange
- Wood Mackenzie - Singapore
- Uttam Galva Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Sical Logistics Limited - India
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- International Coal Ventures Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Makarim & Taira - Indonesia
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Bangladesh Power Developement Board
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- Carbofer General Trading SA - India
- Savvy Resources Ltd - HongKong
- Kobexindo Tractors - Indoneisa
- Marubeni Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Antam Resourcindo - Indonesia
- Malabar Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Goldman Sachs - Singapore
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Manunggal Multi Energi - Indonesia
- London Commodity Brokers - England
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- Bharathi Cement Corporation - India
- Indo Tambangraya Megah - Indonesia
- Standard Chartered Bank - UAE
- GAC Shipping (India) Pvt Ltd
- Meralco Power Generation, Philippines
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Salva Resources Pvt Ltd - India
- Chamber of Mines of South Africa
- Indonesian Coal Mining Association
- Kumho Petrochemical, South Korea
- Thai Mozambique Logistica
- Global Business Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- ASAPP Information Group - India
- CIMB Investment Bank - Malaysia
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- Meenaskhi Energy Private Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Vizag Seaport Private Limited - India
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- Siam City Cement - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thiess Contractors Indonesia
- Port Waratah Coal Services - Australia
- Bhushan Steel Limited - India
- Ambuja Cements Ltd - India
- Commonwealth Bank - Australia
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- Electricity Authority, New Zealand
- Bulk Trading Sa - Switzerland
- Energy Link Ltd, New Zealand
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Georgia Ports Authority, United States
- Planning Commission, India
- Lanco Infratech Ltd - India
- Electricity Generating Authority of Thailand
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- SMC Global Power, Philippines
- Bhatia International Limited - India
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Semirara Mining and Power Corporation, Philippines
- Central Electricity Authority - India
- Kartika Selabumi Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Karbindo Abesyapradhi - Indoneisa
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Videocon Industries ltd - India
- Heidelberg Cement - Germany
- Coastal Gujarat Power Limited - India
- Essar Steel Hazira Ltd - India
- San Jose City I Power Corp, Philippines
- Intertek Mineral Services - Indonesia
- Singapore Mercantile Exchange
- Wilmar Investment Holdings
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Trasteel International SA, Italy
- Holcim Trading Pte Ltd - Singapore
- Minerals Council of Australia
- Merrill Lynch Commodities Europe
- Toyota Tsusho Corporation, Japan
- Borneo Indobara - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- Sojitz Corporation - Japan
- Agrawal Coal Company - India
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Anglo American - United Kingdom
- Gujarat Sidhee Cement - India
- Cement Manufacturers Association - India
- Sree Jayajothi Cements Limited - India
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Formosa Plastics Group - Taiwan
- Semirara Mining Corp, Philippines
- Indian Oil Corporation Limited
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- Maheswari Brothers Coal Limited - India
- Miang Besar Coal Terminal - Indonesia
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- TeaM Sual Corporation - Philippines
- Xindia Steels Limited - India
- The Treasury - Australian Government
- Pipit Mutiara Jaya. PT, Indonesia
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- Mintek Dendrill Indonesia
- India Bulls Power Limited - India
- Central Java Power - Indonesia
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Ind-Barath Power Infra Limited - India
- AsiaOL BioFuels Corp., Philippines
- Ministry of Transport, Egypt
- Orica Mining Services - Indonesia
- CNBM International Corporation - China
- Billiton Holdings Pty Ltd - Australia
- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
- Mjunction Services Limited - India
- Kepco SPC Power Corporation, Philippines
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