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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, 21 September 11
2ND ANNUAL SHALE GAS SUMMIT
2nd Annual Shale Gas Summit 31 October – 3 November 2011 JW Marriott Hotel, Hong Kong
According to a recent EI ...
Tuesday, 20 September 11
MTD INAUGURATES ITS COAL TERMINAL IN JAVA ISLAND
Press Release – MTD Group of Malaysia, one of prominent key players in the development of infrastructure in Malaysia, today inaugurated their ...
Tuesday, 20 September 11
DRY BULK MARKET LOSING ITS EDGE, RETREATING AT THE START OF THE WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
After a surge during the past couple of weeks, which saw Capesize earnings boosted and the BDI (Baltic Dry Index) reaching levels of year high and c ...
Monday, 19 September 11
CHINA IMPORTS MORE THAN 10 MMT INDO COAL IN AUGUST 2011
COALspot.com - Indonesian coal exports dropped 1.642 million tons in August compared to July exports. Indonesia exports 29.662 million tons of coal ...
Monday, 19 September 11
INDOMOBIL ENTERING INTO COAL MINING BUSINESS
COALspot.Com- PT Indomobil Sukses Internasional Tbk, part of, one of Indonesia's largest conglomerates, to enter into mining industry ac ...
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- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
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- Coal and Oil Company - UAE
- Wilmar Investment Holdings
- Ministry of Finance - Indonesia
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- Gujarat Sidhee Cement - India
- Neyveli Lignite Corporation Ltd, - India
- Kohat Cement Company Ltd. - Pakistan
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
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- Energy Development Corp, Philippines
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- Petron Corporation, Philippines
- Cement Manufacturers Association - India
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- Interocean Group of Companies - India
- SN Aboitiz Power Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
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- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- IEA Clean Coal Centre - UK
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- Deloitte Consulting - India
- SMC Global Power, Philippines
- London Commodity Brokers - England
- Jorong Barutama Greston.PT - Indonesia
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- Mercator Lines Limited - India
- Larsen & Toubro Limited - India
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Metalloyd Limited - United Kingdom
- Petrochimia International Co. Ltd.- Taiwan
- Kepco SPC Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Global Coal Blending Company Limited - Australia
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
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- Singapore Mercantile Exchange
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- PowerSource Philippines DevCo
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- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- Alfred C Toepfer International GmbH - Germany
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- Malabar Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- The State Trading Corporation of India Ltd
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- IHS Mccloskey Coal Group - USA
- International Coal Ventures Pvt Ltd - India
- Central Java Power - Indonesia
- VISA Power Limited - India
- GMR Energy Limited - India
- Dalmia Cement Bharat India
- Australian Coal Association
- Mintek Dendrill Indonesia
- Sindya Power Generating Company Private Ltd
- Borneo Indobara - Indonesia
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- Orica Mining Services - Indonesia
- Chettinad Cement Corporation Ltd - India
- Jaiprakash Power Ventures ltd
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Therma Luzon, Inc, Philippines
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- South Luzon Thermal Energy Corporation
- SMG Consultants - Indonesia
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- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
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- Bukit Asam (Persero) Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Antam Resourcindo - Indonesia
- Merrill Lynch Commodities Europe
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Rio Tinto Coal - Australia
- The Treasury - Australian Government
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Maheswari Brothers Coal Limited - India
- Bukit Baiduri Energy - Indonesia
- Riau Bara Harum - Indonesia
- The University of Queensland
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Chamber of Mines of South Africa
- Grasim Industreis Ltd - India
- Standard Chartered Bank - UAE
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Krishnapatnam Port Company Ltd. - India
- Intertek Mineral Services - Indonesia
- Sojitz Corporation - Japan
- Billiton Holdings Pty Ltd - Australia
- LBH Netherlands Bv - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Bangladesh Power Developement Board
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Goldman Sachs - Singapore
- Kartika Selabumi Mining - Indonesia
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Manunggal Multi Energi - Indonesia
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- White Energy Company Limited
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- Renaissance Capital - South Africa
- Thai Mozambique Logistica
- Salva Resources Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Formosa Plastics Group - Taiwan
- Energy Link Ltd, New Zealand
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- Minerals Council of Australia
- Bhatia International Limited - India
- McConnell Dowell - Australia
- Meralco Power Generation, Philippines
- Bharathi Cement Corporation - India
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- GAC Shipping (India) Pvt Ltd
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Romanian Commodities Exchange
- Ambuja Cements Ltd - India
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Commonwealth Bank - Australia
- Edison Trading Spa - Italy
- Mjunction Services Limited - India
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- ASAPP Information Group - India
- Indogreen Group - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Karaikal Port Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Planning Commission, India
- Uttam Galva Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- ICICI Bank Limited - India
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Bukit Makmur.PT - Indonesia
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- Parliament of New Zealand
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