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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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Tuesday, 23 August 11
COAL DEMAND IS REMAINED STRONG IN SPITE OF CURRENT GLOBAL ECONOMIC UNCERTAINTY - BUMI
COALspot.com - Indonesia's largest coal producer, PT Bumi Resources, Tbk (BUMI)'s sales revenue has increased to US$1.79 billion (compared with US ...
Tuesday, 23 August 11
PENRHYN COAL USING EVERGREEN ENERGYS COAL UPGRADING PROCESS
Evergreen Energy Inc has announced the successful testing results of the initial batches of Penrhyn coal using Evergreen Energy’s coal upgradi ...
Tuesday, 23 August 11
A SHARP INCREASE IN THE BDI - BRS
A sharp increase in the BDI this week, driven by the rise in Capesize rates. Overall the BDI was up 13.5% to 1,462 points on the back of a 20% surge ...
Monday, 22 August 11
INDONESIA TO BAN BELOW 5700 KCAL/KG COAL FOR EXPORT
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia is in the process of drafting a regulation which is requiring mine owners ...
Monday, 22 August 11
JATENERGY AGREED TO FORM JV WITH AN INDONESIAN COAL MINING COMPANY
COALspot.com - Australian’s listed company, Jatenergy Limited has entered conditional agreement to form joint venture with Indonesia’s c ...
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- Energy Link Ltd, New Zealand
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- Alfred C Toepfer International GmbH - Germany
- Directorate General of MIneral and Coal - Indonesia
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- OPG Power Generation Pvt Ltd - India
- Romanian Commodities Exchange
- Eastern Coal Council - USA
- Australian Coal Association
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- Indogreen Group - Indonesia
- Indian Oil Corporation Limited
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- Bulk Trading Sa - Switzerland
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- The University of Queensland
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- Global Green Power PLC Corporation, Philippines
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- Bhatia International Limited - India
- Ceylon Electricity Board - Sri Lanka
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- IEA Clean Coal Centre - UK
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- Samtan Co., Ltd - South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Port Waratah Coal Services - Australia
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- Thai Mozambique Logistica
- Malabar Cements Ltd - India
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Ministry of Finance - Indonesia
- Bayan Resources Tbk. - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PNOC Exploration Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- ASAPP Information Group - India
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Posco Energy - South Korea
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- PowerSource Philippines DevCo
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- CNBM International Corporation - China
- Mercator Lines Limited - India
- Parliament of New Zealand
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sojitz Corporation - Japan
- Anglo American - United Kingdom
- Attock Cement Pakistan Limited
- Maheswari Brothers Coal Limited - India
- The State Trading Corporation of India Ltd
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- Price Waterhouse Coopers - Russia
- Sree Jayajothi Cements Limited - India
- Electricity Authority, New Zealand
- Energy Development Corp, Philippines
- Bharathi Cement Corporation - India
- Jaiprakash Power Ventures ltd
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- Standard Chartered Bank - UAE
- Antam Resourcindo - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
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- Makarim & Taira - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Cigading International Bulk Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Karaikal Port Pvt Ltd - India
- Indonesian Coal Mining Association
- CIMB Investment Bank - Malaysia
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- Toyota Tsusho Corporation, Japan
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- Directorate Of Revenue Intelligence - India
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Coal and Oil Company - UAE
- Sakthi Sugars Limited - India
- Rio Tinto Coal - Australia
- Commonwealth Bank - Australia
- SMC Global Power, Philippines
- Manunggal Multi Energi - Indonesia
- Baramulti Group, Indonesia
- Mintek Dendrill Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- Medco Energi Mining Internasional
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- PTC India Limited - India
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Gujarat Electricity Regulatory Commission - India
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- Thiess Contractors Indonesia
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- Merrill Lynch Commodities Europe
- Marubeni Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Orica Mining Services - Indonesia
- Renaissance Capital - South Africa
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- Coalindo Energy - Indonesia
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- Global Business Power Corporation, Philippines
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Minerals Council of Australia
- Heidelberg Cement - Germany
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Iligan Light & Power Inc, Philippines
- Parry Sugars Refinery, India
- Bukit Baiduri Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Power Finance Corporation Ltd., India
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Wood Mackenzie - Singapore
- Chamber of Mines of South Africa
- Indo Tambangraya Megah - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Trasteel International SA, Italy
- Bhoruka Overseas - Indonesia
- Xindia Steels Limited - India
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- McConnell Dowell - Australia
- Gujarat Mineral Development Corp Ltd - India
- Petron Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Ministry of Mines - Canada
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
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- Siam City Cement PLC, Thailand
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