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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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Saturday, 10 September 11
THE FREIGHT MARKET LIKELY TO BE FIRM NEXT WEEK - CAPT. REDDY
COALspot.com - The freight market continued the upward trend during last week with BDI crossing 1,800 points and closing at 1,838 points up by 5.63 ...
Friday, 09 September 11
SUPRA BARA SECURES $20 MILLION LOAN - JP
The Jakarta Post reported that, Coal miner PT Supra Bara Energi says it has secured a US$20 million loan facility from BNP Paribas to buy heavy equi ...
Friday, 09 September 11
CAPESIZE CAN SECURE USD 17-18K SHORT PERIOD - FEARNBULK
Handy
The US Gulf has remained relatively steady, slightly more activity in the South Atlantic with owners aiming for low to mid USD 20k´s f ...
Thursday, 08 September 11
UKRAINES COAL PRODUCTION TO RISE 8% - IFANDP
Industrial fuels & power reported that, Ukraine will increase its coal output by about 8% this year compared to last year, said the country&rsqu ...
Thursday, 08 September 11
DRY BULK MARKETS RALLY COMES TO AN END - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
As was widely expected by analysts and shipbrokers alike, the latest rally of the dry bulk market came to a halt yesterday, with the Baltic Dry Inde ...
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- Ministry of Finance - Indonesia
- Orica Mining Services - Indonesia
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Cigading International Bulk Terminal - Indonesia
- SMG Consultants - Indonesia
- Energy Link Ltd, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Indogreen Group - Indonesia
- Romanian Commodities Exchange
- Power Finance Corporation Ltd., India
- Star Paper Mills Limited - India
- Eastern Energy - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Siam City Cement - Thailand
- Mercator Lines Limited - India
- Xindia Steels Limited - India
- Banpu Public Company Limited - Thailand
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Madhucon Powers Ltd - India
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- Edison Trading Spa - Italy
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Dalmia Cement Bharat India
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Lanco Infratech Ltd - India
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Central Electricity Authority - India
- Kartika Selabumi Mining - Indonesia
- Ministry of Transport, Egypt
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- PTC India Limited - India
- Timah Investasi Mineral - Indoneisa
- Carbofer General Trading SA - India
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Petron Corporation, Philippines
- Orica Australia Pty. Ltd.
- Jindal Steel & Power Ltd - India
- Grasim Industreis Ltd - India
- Antam Resourcindo - Indonesia
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Sojitz Corporation - Japan
- New Zealand Coal & Carbon
- Offshore Bulk Terminal Pte Ltd, Singapore
- Therma Luzon, Inc, Philippines
- Attock Cement Pakistan Limited
- Ind-Barath Power Infra Limited - India
- Merrill Lynch Commodities Europe
- Mercuria Energy - Indonesia
- Africa Commodities Group - South Africa
- Karaikal Port Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- The University of Queensland
- South Luzon Thermal Energy Corporation
- VISA Power Limited - India
- SMC Global Power, Philippines
- Medco Energi Mining Internasional
- Rashtriya Ispat Nigam Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Coal and Oil Company - UAE
- Sical Logistics Limited - India
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- Eastern Coal Council - USA
- IEA Clean Coal Centre - UK
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- San Jose City I Power Corp, Philippines
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Vizag Seaport Private Limited - India
- Mintek Dendrill Indonesia
- Formosa Plastics Group - Taiwan
- Manunggal Multi Energi - Indonesia
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- MS Steel International - UAE
- Alfred C Toepfer International GmbH - Germany
- GAC Shipping (India) Pvt Ltd
- Salva Resources Pvt Ltd - India
- Renaissance Capital - South Africa
- Thiess Contractors Indonesia
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Kaltim Prima Coal - Indonesia
- CNBM International Corporation - China
- Cement Manufacturers Association - India
- Toyota Tsusho Corporation, Japan
- Metalloyd Limited - United Kingdom
- PowerSource Philippines DevCo
- Australian Coal Association
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Indonesian Coal Mining Association
- Sree Jayajothi Cements Limited - India
- TeaM Sual Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Miang Besar Coal Terminal - Indonesia
- Chamber of Mines of South Africa
- Uttam Galva Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Sarangani Energy Corporation, Philippines
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Mjunction Services Limited - India
- White Energy Company Limited
- Riau Bara Harum - Indonesia
- OPG Power Generation Pvt Ltd - India
- Latin American Coal - Colombia
- ASAPP Information Group - India
- Indo Tambangraya Megah - Indonesia
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Intertek Mineral Services - Indonesia
- Bukit Baiduri Energy - Indonesia
- Goldman Sachs - Singapore
- Planning Commission, India
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhoruka Overseas - Indonesia
- CIMB Investment Bank - Malaysia
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Economic Council, Georgia
- Georgia Ports Authority, United States
- Coalindo Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Pendopo Energi Batubara - Indonesia
- Global Coal Blending Company Limited - Australia
- Sakthi Sugars Limited - India
- Karbindo Abesyapradhi - Indoneisa
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Baramulti Group, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Global Green Power PLC Corporation, Philippines
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Minerals Council of Australia
- Indika Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Siam City Cement PLC, Thailand
- Bangladesh Power Developement Board
- Independent Power Producers Association of India
- Tata Chemicals Ltd - India
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Singapore Mercantile Exchange
- IHS Mccloskey Coal Group - USA
- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Bhatia International Limited - India
- Posco Energy - South Korea
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Altura Mining Limited, Indonesia
- Aboitiz Power Corporation - Philippines
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ICICI Bank Limited - India
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