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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, 15 June 11
DRY BULK MARKET WEAKENS AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Despite this time of year traditionally being one of the busiest for the dry bulk market, it seems that in the post-crisis era trade patterns are co ...
Monday, 13 June 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 1.2 PERCENT IN JUNE
COALspot.com - The Ministry of Energy & Mineral Resources sets coal spot price benchmark for June 2011 at US$ 119.03 per ton, higher than US$ 1. ...
Sunday, 12 June 11
THE FREIGHT MARKET IS LIKELY TO BE SOFT NEXT WEEK - CAPT. REDDY
COALspot.com - The freight market continued to soften this week except for Panamax index. The BDI was down by about 4.77 pct and closed at 1,418 poi ...
Friday, 10 June 11
DRY BULK ON RETREAT MODE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
This week has offered dry bulk ship owners no real reason to smile, as the industry’s benchmarket, the Baltic Dry Index (BDI) has been steadil ...
Friday, 10 June 11
BUKIT ASAM RECORDED RP1.3 TRILLION PROFIT IN MAY - TEMPO INTERACTIVE
Tempo Interactive reported that, PT PT Tambang Batubara Bukit Asam Tbk (PTBA) made a net profit of Rp 1.3 trillion (approx. US$ 152,779,410) at the ...
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- Interocean Group of Companies - India
- Electricity Authority, New Zealand
- Indika Energy - Indonesia
- Antam Resourcindo - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Georgia Ports Authority, United States
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Latin American Coal - Colombia
- Kapuas Tunggal Persada - Indonesia
- South Luzon Thermal Energy Corporation
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Kalimantan Lumbung Energi - Indonesia
- Deloitte Consulting - India
- Metalloyd Limited - United Kingdom
- Bhushan Steel Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Kumho Petrochemical, South Korea
- Orica Mining Services - Indonesia
- Medco Energi Mining Internasional
- Mintek Dendrill Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kobexindo Tractors - Indoneisa
- SMC Global Power, Philippines
- Posco Energy - South Korea
- Petron Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Wilmar Investment Holdings
- Singapore Mercantile Exchange
- Energy Link Ltd, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- SN Aboitiz Power Inc, Philippines
- Africa Commodities Group - South Africa
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- VISA Power Limited - India
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- PowerSource Philippines DevCo
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- Larsen & Toubro Limited - India
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Mines - Canada
- Australian Coal Association
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- McConnell Dowell - Australia
- Sarangani Energy Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
- Straits Asia Resources Limited - Singapore
- Kideco Jaya Agung - Indonesia
- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Neyveli Lignite Corporation Ltd, - India
- Aditya Birla Group - India
- Kepco SPC Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Essar Steel Hazira Ltd - India
- Bharathi Cement Corporation - India
- Tamil Nadu electricity Board
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Marubeni Corporation - India
- Meenaskhi Energy Private Limited - India
- Electricity Generating Authority of Thailand
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Parry Sugars Refinery, India
- Independent Power Producers Association of India
- Alfred C Toepfer International GmbH - Germany
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IEA Clean Coal Centre - UK
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Chamber of Mines of South Africa
- Sree Jayajothi Cements Limited - India
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Karbindo Abesyapradhi - Indoneisa
- Thai Mozambique Logistica
- Ministry of Transport, Egypt
- SMG Consultants - Indonesia
- Planning Commission, India
- Karaikal Port Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- The Treasury - Australian Government
- Rio Tinto Coal - Australia
- PTC India Limited - India
- Krishnapatnam Port Company Ltd. - India
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Videocon Industries ltd - India
- Power Finance Corporation Ltd., India
- Central Java Power - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Timah Investasi Mineral - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Cement Manufacturers Association - India
- Salva Resources Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Standard Chartered Bank - UAE
- IHS Mccloskey Coal Group - USA
- Global Green Power PLC Corporation, Philippines
- Indian Oil Corporation Limited
- MS Steel International - UAE
- Agrawal Coal Company - India
- Indo Tambangraya Megah - Indonesia
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- Merrill Lynch Commodities Europe
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Goldman Sachs - Singapore
- Sakthi Sugars Limited - India
- White Energy Company Limited
- India Bulls Power Limited - India
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Ambuja Cements Ltd - India
- Formosa Plastics Group - Taiwan
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Romanian Commodities Exchange
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GVK Power & Infra Limited - India
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Parliament of New Zealand
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Bayan Resources Tbk. - Indonesia
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- Lanco Infratech Ltd - India
- Bhoruka Overseas - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Star Paper Mills Limited - India
- Ministry of Finance - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Energy Development Corp, Philippines
- Siam City Cement - Thailand
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- Gujarat Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Directorate Of Revenue Intelligence - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Siam City Cement PLC, Thailand
- Gujarat Sidhee Cement - India
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Ind-Barath Power Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Port Waratah Coal Services - Australia
- The University of Queensland
- Sical Logistics Limited - India
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- CIMB Investment Bank - Malaysia
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Bukit Baiduri Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Economic Council, Georgia
- Central Electricity Authority - India
- Carbofer General Trading SA - India
- Sinarmas Energy and Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Coalindo Energy - Indonesia
- London Commodity Brokers - England
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