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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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Thursday, 19 May 11
INDONESIAN COAL EXPORTS DROP 7.98 PERCENT IN APRIL
COALspot.com - Indonesian coal exports dropped to 2.168 million tons in April, and up 7.13 percent on the year and 7.98 percent below March, a ...
Thursday, 19 May 11
OVERSUPPLY, VERY LARGE ORE CARRIERS EAT UP ON DRY BULK FREIGHT RATES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
After a brief upward momentum which ended early last week, the Baltic Dry Index, the dry bulk market’s benchmark has returned to its usual pat ...
Wednesday, 18 May 11
THE US COAL INDUSTRY LOGGED EXPORTS OF AROUND 25M TONNES IN 1Q OF 2011 - BRS
Another slow decline in the bulk markets this week, with the BCI losing the most at nearly 5%, the BPI 2.8% and the smaller sizes sub-1% amounts. Th ...
Wednesday, 18 May 11
AKR AIMS TO SELL COAL WORTH RP216 BILLION - PAPER
Bisnis Indonesia, an Indonesia's one of the leading business paper reported that, PT AKR Corporindo Tbk has targeted coal sales valued at Rp216 bil ...
Wednesday, 18 May 11
OVERHAUL OF MINING LAW MAY DETER INVESTMENT, S&P SAYS - THE JAKARTA GLOBE
The Jakarta Globe, an Indonesian English language news paper reported that, A report by Standard & Poor’s Ratings Services that a regulatory ...
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- Jorong Barutama Greston.PT - Indonesia
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- McConnell Dowell - Australia
- Merrill Lynch Commodities Europe
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- PNOC Exploration Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Madhucon Powers Ltd - India
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- Asmin Koalindo Tuhup - Indonesia
- Electricity Generating Authority of Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Marubeni Corporation - India
- Simpson Spence & Young - Indonesia
- Meenaskhi Energy Private Limited - India
- New Zealand Coal & Carbon
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- The University of Queensland
- Goldman Sachs - Singapore
- Central Java Power - Indonesia
- Toyota Tsusho Corporation, Japan
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- Anglo American - United Kingdom
- GAC Shipping (India) Pvt Ltd
- Medco Energi Mining Internasional
- Directorate General of MIneral and Coal - Indonesia
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- ASAPP Information Group - India
- OPG Power Generation Pvt Ltd - India
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Malabar Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Latin American Coal - Colombia
- Binh Thuan Hamico - Vietnam
- Intertek Mineral Services - Indonesia
- Vedanta Resources Plc - India
- Eastern Coal Council - USA
- Georgia Ports Authority, United States
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- PowerSource Philippines DevCo
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Coal and Oil Company - UAE
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Price Waterhouse Coopers - Russia
- Tamil Nadu electricity Board
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- VISA Power Limited - India
- Banpu Public Company Limited - Thailand
- Parry Sugars Refinery, India
- The State Trading Corporation of India Ltd
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Renaissance Capital - South Africa
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- Posco Energy - South Korea
- Meralco Power Generation, Philippines
- Aboitiz Power Corporation - Philippines
- Oldendorff Carriers - Singapore
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Sree Jayajothi Cements Limited - India
- GMR Energy Limited - India
- San Jose City I Power Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Deloitte Consulting - India
- Eastern Energy - Thailand
- South Luzon Thermal Energy Corporation
- Coalindo Energy - Indonesia
- Aditya Birla Group - India
- Uttam Galva Steels Limited - India
- Parliament of New Zealand
- Sinarmas Energy and Mining - Indonesia
- Carbofer General Trading SA - India
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- ICICI Bank Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Economic Council, Georgia
- AsiaOL BioFuels Corp., Philippines
- Lanco Infratech Ltd - India
- IEA Clean Coal Centre - UK
- Bukit Baiduri Energy - Indonesia
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Siam City Cement PLC, Thailand
- Indonesian Coal Mining Association
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- Chamber of Mines of South Africa
- SN Aboitiz Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Mercator Lines Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Attock Cement Pakistan Limited
- Ambuja Cements Ltd - India
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- Globalindo Alam Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Tata Chemicals Ltd - India
- Jaiprakash Power Ventures ltd
- Singapore Mercantile Exchange
- Therma Luzon, Inc, Philippines
- Wilmar Investment Holdings
- Altura Mining Limited, Indonesia
- Commonwealth Bank - Australia
- Bayan Resources Tbk. - Indonesia
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- White Energy Company Limited
- Electricity Authority, New Zealand
- Coastal Gujarat Power Limited - India
- Bharathi Cement Corporation - India
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Kepco SPC Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rashtriya Ispat Nigam Limited - India
- Indo Tambangraya Megah - Indonesia
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- Straits Asia Resources Limited - Singapore
- Kideco Jaya Agung - Indonesia
- Antam Resourcindo - Indonesia
- Central Electricity Authority - India
- Bhushan Steel Limited - India
- Bhatia International Limited - India
- Indian Energy Exchange, India
- Petrochimia International Co. Ltd.- Taiwan
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Australian Coal Association
- Africa Commodities Group - South Africa
- Australian Commodity Traders Exchange
- India Bulls Power Limited - India
- Mintek Dendrill Indonesia
- Bhoruka Overseas - Indonesia
- Savvy Resources Ltd - HongKong
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- Sakthi Sugars Limited - India
- Global Business Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Timah Investasi Mineral - Indoneisa
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Heidelberg Cement - Germany
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PetroVietnam Power Coal Import and Supply Company
- Independent Power Producers Association of India
- Krishnapatnam Port Company Ltd. - India
- Interocean Group of Companies - India
- Dalmia Cement Bharat India
- Global Green Power PLC Corporation, Philippines
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