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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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Friday, 05 August 11
RIO TINTO SIGNS MOU WITH JINDAL STEEL AND POWER ON ADVANCING HISMELT TECHNOLOGY
Press Release - Rio Tinto has signed a Memorandum of Understanding (MoU) with Jindal Steel and Power Limited (JSPL) to take the next step in g ...
Friday, 05 August 11
THE WORLDS LARGEST COAL MINER TO INVEST IN INDO MINES
COALspot.com - Golden Energy Mines (GEMS) might go for initial public offering (IPO) by the end of September 2011. The company is planning to off lo ...
Friday, 05 August 11
DRY BULK MARKET FINALLY TAKES A BREATHER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market at last caught a break mid-week after a constant fall which saw the industry’s benchmark, the BDI (Baltic Dry Index) falli ...
Thursday, 04 August 11
THE HBA CONTINUES TO FALL IN AUGUST
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has set the August 2011 coal reference price at US$ 117.21 per ton slightly low ...
Wednesday, 03 August 11
DEWA RETURNS TO US$2.65 MIO NET PROFIT - INSIDER STORIES
Coal mining contractor PT Darma Henwa Tbk (DEWA), that most of its revenue is contributed by Kaltim Prima Coal and Arutmin Indonesia, returned to ne ...
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Posco Energy - South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Mines - Canada
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Bhushan Steel Limited - India
- Directorate Of Revenue Intelligence - India
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Energy Link Ltd, New Zealand
- San Jose City I Power Corp, Philippines
- Commonwealth Bank - Australia
- Banpu Public Company Limited - Thailand
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- Wood Mackenzie - Singapore
- Interocean Group of Companies - India
- PetroVietnam Power Coal Import and Supply Company
- Lanco Infratech Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- Mercator Lines Limited - India
- Sinarmas Energy and Mining - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Bukit Baiduri Energy - Indonesia
- Mjunction Services Limited - India
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- Metalloyd Limited - United Kingdom
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- Kalimantan Lumbung Energi - Indonesia
- Madhucon Powers Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- CIMB Investment Bank - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- Mintek Dendrill Indonesia
- Baramulti Group, Indonesia
- Indo Tambangraya Megah - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Bukit Makmur.PT - Indonesia
- Price Waterhouse Coopers - Russia
- Meenaskhi Energy Private Limited - India
- Renaissance Capital - South Africa
- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Grasim Industreis Ltd - India
- Indian Energy Exchange, India
- Holcim Trading Pte Ltd - Singapore
- Kepco SPC Power Corporation, Philippines
- Indika Energy - Indonesia
- Antam Resourcindo - Indonesia
- Tata Chemicals Ltd - India
- Manunggal Multi Energi - Indonesia
- White Energy Company Limited
- Kumho Petrochemical, South Korea
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Maheswari Brothers Coal Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Eastern Energy - Thailand
- Deloitte Consulting - India
- Simpson Spence & Young - Indonesia
- Chamber of Mines of South Africa
- Meralco Power Generation, Philippines
- PTC India Limited - India
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- Pipit Mutiara Jaya. PT, Indonesia
- Marubeni Corporation - India
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Uttam Galva Steels Limited - India
- Bayan Resources Tbk. - Indonesia
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- MS Steel International - UAE
- Gujarat Electricity Regulatory Commission - India
- Kaltim Prima Coal - Indonesia
- Dalmia Cement Bharat India
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- Standard Chartered Bank - UAE
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Krishnapatnam Port Company Ltd. - India
- Kartika Selabumi Mining - Indonesia
- Cement Manufacturers Association - India
- Ministry of Finance - Indonesia
- The State Trading Corporation of India Ltd
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Jindal Steel & Power Ltd - India
- Coastal Gujarat Power Limited - India
- Economic Council, Georgia
- Singapore Mercantile Exchange
- Semirara Mining and Power Corporation, Philippines
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Attock Cement Pakistan Limited
- Wilmar Investment Holdings
- ICICI Bank Limited - India
- Samtan Co., Ltd - South Korea
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Trasteel International SA, Italy
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Thai Mozambique Logistica
- Agrawal Coal Company - India
- Semirara Mining Corp, Philippines
- Port Waratah Coal Services - Australia
- Sojitz Corporation - Japan
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- India Bulls Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Heidelberg Cement - Germany
- Latin American Coal - Colombia
- TeaM Sual Corporation - Philippines
- Planning Commission, India
- Oldendorff Carriers - Singapore
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- Therma Luzon, Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Bharathi Cement Corporation - India
- International Coal Ventures Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Bhoruka Overseas - Indonesia
- Indogreen Group - Indonesia
- Romanian Commodities Exchange
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- New Zealand Coal & Carbon
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Ministry of Transport, Egypt
- Gujarat Sidhee Cement - India
- IEA Clean Coal Centre - UK
- Vizag Seaport Private Limited - India
- Eastern Coal Council - USA
- Medco Energi Mining Internasional
- Africa Commodities Group - South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Java Power - Indonesia
- VISA Power Limited - India
- Merrill Lynch Commodities Europe
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Global Business Power Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Aditya Birla Group - India
- SMC Global Power, Philippines
- Jaiprakash Power Ventures ltd
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
- Malabar Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- The University of Queensland
- Ind-Barath Power Infra Limited - India
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