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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, 28 September 11
ATLAS RESOURCES TO SELL 25% STAKE IN IPO - INSIDER STORIES
Insider Stories reported that, coal producer PT Atlas Resources Tbk, that is controlled by Indonesian businessman Andre Abdi, plans to sell 783.33 m ...
Tuesday, 27 September 11
A STRONG REBOUND FOR THE CAPE MARKET - BRS
A strong rebound for the Cape market, as cargoes continued to flow into the market and tonnage remained tight in the Atlantic, according to Barry Ro ...
Tuesday, 27 September 11
INTRACO SEALS US$25.3 MIO ORDER - INSIDER STORIES
Insider Stories reported that, Heavy equipment distributor PT Intraco Penta Tbk (INTA) obtained a US$25.3 million order on hand of heavy equipments ...
Sunday, 25 September 11
THE CHARTER RATES FOR INDONESIA TO INDIA WAS FIRM - VISTAAR
COALspot.com - The freight market moved up sharply with the cape Index up by 11 pct pushing the BDI by almost 6 pct and closing at 1,920 point ...
Saturday, 24 September 11
GOVT PLANS TO RENEGOTIATE ALL CONTRACTS INCLUDING FREEPORT - JP
The Jakarta Post reported that, the Energy and Mineral Resources Ministry has confirmed plans to renegotiate all mining contracts including those wi ...
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- TNB Fuel Sdn Bhd - Malaysia
- Global Green Power PLC Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Globalindo Alam Lestari - Indonesia
- The University of Queensland
- Malabar Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Riau Bara Harum - Indonesia
- Meenaskhi Energy Private Limited - India
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Ministry of Mines - Canada
- Minerals Council of Australia
- Antam Resourcindo - Indonesia
- Mercuria Energy - Indonesia
- Siam City Cement PLC, Thailand
- Sakthi Sugars Limited - India
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Lanco Infratech Ltd - India
- Australian Commodity Traders Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Parry Sugars Refinery, India
- Star Paper Mills Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Indian Energy Exchange, India
- Makarim & Taira - Indonesia
- Posco Energy - South Korea
- Planning Commission, India
- Electricity Authority, New Zealand
- Chettinad Cement Corporation Ltd - India
- Oldendorff Carriers - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Eastern Energy - Thailand
- Romanian Commodities Exchange
- Edison Trading Spa - Italy
- Cement Manufacturers Association - India
- Xindia Steels Limited - India
- Mjunction Services Limited - India
- Renaissance Capital - South Africa
- Heidelberg Cement - Germany
- VISA Power Limited - India
- Georgia Ports Authority, United States
- Straits Asia Resources Limited - Singapore
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Larsen & Toubro Limited - India
- Borneo Indobara - Indonesia
- Grasim Industreis Ltd - India
- Semirara Mining Corp, Philippines
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Economic Council, Georgia
- Indika Energy - Indonesia
- Meralco Power Generation, Philippines
- Mercator Lines Limited - India
- Kideco Jaya Agung - Indonesia
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Pendopo Energi Batubara - Indonesia
- Aditya Birla Group - India
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Indonesian Coal Mining Association
- New Zealand Coal & Carbon
- Petron Corporation, Philippines
- Parliament of New Zealand
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Maharashtra Electricity Regulatory Commission - India
- Ceylon Electricity Board - Sri Lanka
- Price Waterhouse Coopers - Russia
- Asmin Koalindo Tuhup - Indonesia
- Indogreen Group - Indonesia
- TeaM Sual Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Gujarat Sidhee Cement - India
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- AsiaOL BioFuels Corp., Philippines
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Siam City Cement - Thailand
- Central Electricity Authority - India
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- ICICI Bank Limited - India
- Thai Mozambique Logistica
- Gujarat Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Tamil Nadu electricity Board
- Thiess Contractors Indonesia
- Tata Chemicals Ltd - India
- PTC India Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Medco Energi Mining Internasional
- SMC Global Power, Philippines
- Salva Resources Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Binh Thuan Hamico - Vietnam
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- Savvy Resources Ltd - HongKong
- Semirara Mining and Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Aboitiz Power Corporation - Philippines
- Central Java Power - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Latin American Coal - Colombia
- India Bulls Power Limited - India
- Australian Coal Association
- Alfred C Toepfer International GmbH - Germany
- Anglo American - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Bukit Makmur.PT - Indonesia
- Uttam Galva Steels Limited - India
- South Luzon Thermal Energy Corporation
- Intertek Mineral Services - Indonesia
- Bhatia International Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Ambuja Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- White Energy Company Limited
- Independent Power Producers Association of India
- Kohat Cement Company Ltd. - Pakistan
- Agrawal Coal Company - India
- Toyota Tsusho Corporation, Japan
- Coal and Oil Company - UAE
- CIMB Investment Bank - Malaysia
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- Kepco SPC Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Kartika Selabumi Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMG Consultants - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Electricity Generating Authority of Thailand
- Videocon Industries ltd - India
- Barasentosa Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Bukit Baiduri Energy - Indonesia
- Standard Chartered Bank - UAE
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- Kobexindo Tractors - Indoneisa
- Vizag Seaport Private Limited - India
- Bulk Trading Sa - Switzerland
- The Treasury - Australian Government
- Energy Development Corp, Philippines
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- International Coal Ventures Pvt Ltd - India
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- Sinarmas Energy and Mining - Indonesia
- Sical Logistics Limited - India
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chamber of Mines of South Africa
- Ministry of Finance - Indonesia
- Samtan Co., Ltd - South Korea
- Jaiprakash Power Ventures ltd
- Bahari Cakrawala Sebuku - Indonesia
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- LBH Netherlands Bv - Netherlands
- Power Finance Corporation Ltd., India
- London Commodity Brokers - England
- Marubeni Corporation - India
- PNOC Exploration Corporation - Philippines
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- Indo Tambangraya Megah - Indonesia
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Energy Link Ltd, New Zealand
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