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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, 17 May 11
DRY BULK MARKET ENTERS WEEK ON WEAK MODE - HELLENIC SHIPPING
In yet another sign of softening freight rates for dry bulk carriers and oversupply issues, the dry bulk market entered this week on a downward path ...
Monday, 16 May 11
INDO TAMBANG 1Q SALES REVENUE UP - INSIDER STORIES
Thai Banpu Plc last week reported a 7.83% increase in coal sales revenue from its Indonesian operating unit via PT Indo Tambangraya Megah Tbk (ITMG) ...
Sunday, 15 May 11
THE FREIGHT MARKET REMAINED SOFT - VISTAAR
COALspot.com - "The freight market overall remained soft", said Capt. Reddy, Director of Vistaar Shipping Singapore. He further added, &qu ...
Saturday, 14 May 11
WELSPUN TO ACQUIRE AN INDONESIAN COAL MINE - MEDIA
The India based Welspun Power and Steel Ltd is planning to acquire 456,000 shares in PT Batubara Energy Indonesia, representing 75% interest, accord ...
Saturday, 14 May 11
DRY BULK MARKET ON A DOWNFALL ONCE AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what is now pretty clear will be yet another challenging year for dry bulk ship owners, the Baltic Dry Index returned to its usual pattern of dec ...
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- Commonwealth Bank - Australia
- Mercator Lines Limited - India
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- San Jose City I Power Corp, Philippines
- Electricity Authority, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- PNOC Exploration Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Mintek Dendrill Indonesia
- CIMB Investment Bank - Malaysia
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Pendopo Energi Batubara - Indonesia
- Aditya Birla Group - India
- Indonesian Coal Mining Association
- Vizag Seaport Private Limited - India
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- Meralco Power Generation, Philippines
- Port Waratah Coal Services - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sarangani Energy Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Karaikal Port Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Global Coal Blending Company Limited - Australia
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Australian Commodity Traders Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- Indo Tambangraya Megah - Indonesia
- Planning Commission, India
- Vedanta Resources Plc - India
- Energy Development Corp, Philippines
- Ambuja Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Minerals Council of Australia
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Posco Energy - South Korea
- Savvy Resources Ltd - HongKong
- Lanco Infratech Ltd - India
- New Zealand Coal & Carbon
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kartika Selabumi Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- The University of Queensland
- Siam City Cement PLC, Thailand
- Parliament of New Zealand
- Meenaskhi Energy Private Limited - India
- Indika Energy - Indonesia
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- Wilmar Investment Holdings
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- Salva Resources Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Chettinad Cement Corporation Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- Orica Mining Services - Indonesia
- Bhoruka Overseas - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Thai Mozambique Logistica
- Bukit Baiduri Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- Coastal Gujarat Power Limited - India
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Bhushan Steel Limited - India
- Sojitz Corporation - Japan
- Tata Chemicals Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- Gujarat Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- SMG Consultants - Indonesia
- Agrawal Coal Company - India
- Romanian Commodities Exchange
- Sakthi Sugars Limited - India
- Grasim Industreis Ltd - India
- McConnell Dowell - Australia
- India Bulls Power Limited - India
- Eastern Energy - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Interocean Group of Companies - India
- Anglo American - United Kingdom
- Edison Trading Spa - Italy
- GMR Energy Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Energy Exchange, India
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Karbindo Abesyapradhi - Indoneisa
- Sindya Power Generating Company Private Ltd
- Riau Bara Harum - Indonesia
- Altura Mining Limited, Indonesia
- Australian Coal Association
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- VISA Power Limited - India
- Madhucon Powers Ltd - India
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Banpu Public Company Limited - Thailand
- European Bulk Services B.V. - Netherlands
- Marubeni Corporation - India
- Sree Jayajothi Cements Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Tamil Nadu electricity Board
- Economic Council, Georgia
- Uttam Galva Steels Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- White Energy Company Limited
- Ministry of Transport, Egypt
- Alfred C Toepfer International GmbH - Germany
- Aboitiz Power Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- Kepco SPC Power Corporation, Philippines
- Indogreen Group - Indonesia
- TeaM Sual Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- Central Electricity Authority - India
- Sinarmas Energy and Mining - Indonesia
- Mercuria Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Ministry of Mines - Canada
- Larsen & Toubro Limited - India
- Singapore Mercantile Exchange
- TNB Fuel Sdn Bhd - Malaysia
- SMC Global Power, Philippines
- Cement Manufacturers Association - India
- Formosa Plastics Group - Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Manunggal Multi Energi - Indonesia
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Global Green Power PLC Corporation, Philippines
- Standard Chartered Bank - UAE
- SN Aboitiz Power Inc, Philippines
- Bhatia International Limited - India
- Heidelberg Cement - Germany
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Oldendorff Carriers - Singapore
- Carbofer General Trading SA - India
- Jorong Barutama Greston.PT - Indonesia
- Central Java Power - Indonesia
- Ministry of Finance - Indonesia
- Iligan Light & Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- Bangladesh Power Developement Board
- Ind-Barath Power Infra Limited - India
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- International Coal Ventures Pvt Ltd - India
- Bharathi Cement Corporation - India
- IEA Clean Coal Centre - UK
- Holcim Trading Pte Ltd - Singapore
- Barasentosa Lestari - Indonesia
- Merrill Lynch Commodities Europe
- Directorate Of Revenue Intelligence - India
- Bayan Resources Tbk. - Indonesia
- Dalmia Cement Bharat India
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
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