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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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Wednesday, 12 October 11
INDONESIAS COAL RUSH - JOSEPH KIRSCHKE
COALspot.com - Last winter, the Chinese government mobilized thousands of soldiers and reservists of the People’s Liberation Army to the port ...
Wednesday, 12 October 11
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There was a surge across all sizes last week, resulting in the BDI gaining 101 points to end the week at 2,000 points (+5.3%). The BCI reached 3,218 ...
Wednesday, 12 October 11
CAPESIZE FREIGHT RATES BOUND TO RETREAT FROM 2011 HIGHS ON THE BACK OF TONNAGE OVERSUPPLY SAYS BIMCO
According to Nikos Roussanoglou, Hellenic Shipping, with the BDI (Baltic Dry Index) breaking yet another 2011 high yesterday and ending the se ...
Tuesday, 11 October 11
GLENCORE, SUITOR FOR BUMI PLC? - INSIDER STORIES
Insider Stories reported that, the largest commodities trader in the world, Glencore International Plc, is considering an opportunity to acquire a m ...
Tuesday, 11 October 11
RENUKA COALINDO BUYS JAMBI COAL
PT Renuka Coalindo Tbk, formerly PT Allbond Makmur Usaha Tbk plans to acquire PT Jambi Prima Coal holder of mining concession in Pauh, Sa ...
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- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Australian Coal Association
- Indonesian Coal Mining Association
- Parry Sugars Refinery, India
- PNOC Exploration Corporation - Philippines
- Minerals Council of Australia
- Intertek Mineral Services - Indonesia
- Thiess Contractors Indonesia
- Grasim Industreis Ltd - India
- Manunggal Multi Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sojitz Corporation - Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Global Business Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Parliament of New Zealand
- International Coal Ventures Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement - Thailand
- The Treasury - Australian Government
- Sical Logistics Limited - India
- Global Coal Blending Company Limited - Australia
- Wilmar Investment Holdings
- Riau Bara Harum - Indonesia
- Pendopo Energi Batubara - Indonesia
- Barasentosa Lestari - Indonesia
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- IHS Mccloskey Coal Group - USA
- Madhucon Powers Ltd - India
- Independent Power Producers Association of India
- Krishnapatnam Port Company Ltd. - India
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Semirara Mining Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- AsiaOL BioFuels Corp., Philippines
- Leighton Contractors Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- Marubeni Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- Makarim & Taira - Indonesia
- Romanian Commodities Exchange
- Larsen & Toubro Limited - India
- Bhoruka Overseas - Indonesia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Indika Energy - Indonesia
- Ministry of Finance - Indonesia
- TeaM Sual Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Straits Asia Resources Limited - Singapore
- Jaiprakash Power Ventures ltd
- Heidelberg Cement - Germany
- Central Electricity Authority - India
- Mjunction Services Limited - India
- CIMB Investment Bank - Malaysia
- ICICI Bank Limited - India
- GAC Shipping (India) Pvt Ltd
- Bharathi Cement Corporation - India
- Central Java Power - Indonesia
- Electricity Authority, New Zealand
- Medco Energi Mining Internasional
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Economic Council, Georgia
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Ambuja Cements Ltd - India
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- India Bulls Power Limited - India
- Petron Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Anglo American - United Kingdom
- Samtan Co., Ltd - South Korea
- Interocean Group of Companies - India
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Singapore Mercantile Exchange
- Agrawal Coal Company - India
- PetroVietnam Power Coal Import and Supply Company
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Altura Mining Limited, Indonesia
- Orica Mining Services - Indonesia
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- MS Steel International - UAE
- GMR Energy Limited - India
- Gujarat Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Sree Jayajothi Cements Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Transport, Egypt
- McConnell Dowell - Australia
- Coalindo Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Indogreen Group - Indonesia
- Oldendorff Carriers - Singapore
- Mercator Lines Limited - India
- Goldman Sachs - Singapore
- Bhushan Steel Limited - India
- SMC Global Power, Philippines
- Africa Commodities Group - South Africa
- New Zealand Coal & Carbon
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Ministry of Mines - Canada
- Georgia Ports Authority, United States
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Tamil Nadu electricity Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Attock Cement Pakistan Limited
- PTC India Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Renaissance Capital - South Africa
- Siam City Cement PLC, Thailand
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- OPG Power Generation Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Wood Mackenzie - Singapore
- Directorate Of Revenue Intelligence - India
- Essar Steel Hazira Ltd - India
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Orica Australia Pty. Ltd.
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bulk Trading Sa - Switzerland
- Bahari Cakrawala Sebuku - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Tata Chemicals Ltd - India
- Karaikal Port Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- The State Trading Corporation of India Ltd
- Kumho Petrochemical, South Korea
- Maheswari Brothers Coal Limited - India
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Eastern Energy - Thailand
- Toyota Tsusho Corporation, Japan
- Metalloyd Limited - United Kingdom
- Therma Luzon, Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Directorate General of MIneral and Coal - Indonesia
- Indian Oil Corporation Limited
- Chamber of Mines of South Africa
- IEA Clean Coal Centre - UK
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- SN Aboitiz Power Inc, Philippines
- Aditya Birla Group - India
- Star Paper Mills Limited - India
- Kartika Selabumi Mining - Indonesia
- Merrill Lynch Commodities Europe
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Commonwealth Bank - Australia
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Malabar Cements Ltd - India
- Indian Energy Exchange, India
- Borneo Indobara - Indonesia
- Gujarat Sidhee Cement - India
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- South Luzon Thermal Energy Corporation
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- White Energy Company Limited
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- Planning Commission, India
- European Bulk Services B.V. - Netherlands
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- Bukit Makmur.PT - Indonesia
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