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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, 05 May 11
PANAMAXES LEAD DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market’s benchmark, the Baltic Dry Index (BDI) managed to edge higher yesterday, rising by 1.81% to 1,292 points, in the first po ...
Thursday, 05 May 11
AKR NAMES KARUNIA AS COAL CONTRACTOR
Insider Stories reported that, PT AKR Corporindo Tbk has appointed PT Karunia Bumi Khatulistiwa as the contractor of coal mining concession in North ...
Tuesday, 03 May 11
DRY BULK MARKET OUTLOOK SEEN WEAK, AS SHIP OWNERS PILE UP MORE SHIPS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the Baltic Dry Index not trading yesterday, it’s worth taking a step back to see the current freight levels. First of all, capesizes and ...
Tuesday, 03 May 11
THE HANDY MARKET CONTINUED TO SLIDE DOWN - BRS
There were marginal increases in rates for the larger sizes this week, with the Cape index remaining stable and the Panamax index logging a 5% incre ...
Monday, 02 May 11
ADARO POSTS 11.7 PERCENT INCREASE IN REVENUES ON HIGHER PRICES - THE JAKARTA POST
The Jakarta Post reported that, Indonesia’s second-largest coal producer, PT Adaro Energy Tbk, announced an 11.7 percent increase in net reven ...
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Australia Pty. Ltd.
- Lanco Infratech Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sakthi Sugars Limited - India
- The Treasury - Australian Government
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- IHS Mccloskey Coal Group - USA
- Ministry of Finance - Indonesia
- Kumho Petrochemical, South Korea
- Maheswari Brothers Coal Limited - India
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Global Green Power PLC Corporation, Philippines
- Indian Energy Exchange, India
- Agrawal Coal Company - India
- South Luzon Thermal Energy Corporation
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Commonwealth Bank - Australia
- Rashtriya Ispat Nigam Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Standard Chartered Bank - UAE
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- White Energy Company Limited
- Simpson Spence & Young - Indonesia
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- The State Trading Corporation of India Ltd
- Carbofer General Trading SA - India
- Wilmar Investment Holdings
- MS Steel International - UAE
- VISA Power Limited - India
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- Petrochimia International Co. Ltd.- Taiwan
- San Jose City I Power Corp, Philippines
- Coastal Gujarat Power Limited - India
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- Manunggal Multi Energi - Indonesia
- Xindia Steels Limited - India
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- McConnell Dowell - Australia
- Energy Link Ltd, New Zealand
- SMC Global Power, Philippines
- Thiess Contractors Indonesia
- Planning Commission, India
- Mintek Dendrill Indonesia
- Indogreen Group - Indonesia
- Sarangani Energy Corporation, Philippines
- Vedanta Resources Plc - India
- Rio Tinto Coal - Australia
- Larsen & Toubro Limited - India
- Karaikal Port Pvt Ltd - India
- Indika Energy - Indonesia
- Semirara Mining Corp, Philippines
- Anglo American - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Indo Tambangraya Megah - Indonesia
- Bukit Baiduri Energy - Indonesia
- Marubeni Corporation - India
- Bangladesh Power Developement Board
- New Zealand Coal & Carbon
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Chamber of Mines of South Africa
- Ministry of Mines - Canada
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- Kaltim Prima Coal - Indonesia
- Ministry of Transport, Egypt
- Banpu Public Company Limited - Thailand
- CIMB Investment Bank - Malaysia
- Intertek Mineral Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- Videocon Industries ltd - India
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Makarim & Taira - Indonesia
- GVK Power & Infra Limited - India
- Siam City Cement PLC, Thailand
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Siam City Cement - Thailand
- CNBM International Corporation - China
- GN Power Mariveles Coal Plant, Philippines
- Bayan Resources Tbk. - Indonesia
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Savvy Resources Ltd - HongKong
- Chettinad Cement Corporation Ltd - India
- Madhucon Powers Ltd - India
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Georgia Ports Authority, United States
- GMR Energy Limited - India
- SMG Consultants - Indonesia
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- European Bulk Services B.V. - Netherlands
- Samtan Co., Ltd - South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- International Coal Ventures Pvt Ltd - India
- Mjunction Services Limited - India
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- TeaM Sual Corporation - Philippines
- PNOC Exploration Corporation - Philippines
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Coal and Oil Company - UAE
- Therma Luzon, Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Jaiprakash Power Ventures ltd
- AsiaOL BioFuels Corp., Philippines
- Indonesian Coal Mining Association
- Global Coal Blending Company Limited - Australia
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- Bukit Asam (Persero) Tbk - Indonesia
- Global Business Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Mercuria Energy - Indonesia
- Attock Cement Pakistan Limited
- Parliament of New Zealand
- London Commodity Brokers - England
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- Uttam Galva Steels Limited - India
- Orica Mining Services - Indonesia
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Krishnapatnam Port Company Ltd. - India
- Kobexindo Tractors - Indoneisa
- Vizag Seaport Private Limited - India
- Baramulti Group, Indonesia
- OPG Power Generation Pvt Ltd - India
- Tata Chemicals Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Billiton Holdings Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- Interocean Group of Companies - India
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coalindo Energy - Indonesia
- Port Waratah Coal Services - Australia
- Independent Power Producers Association of India
- ICICI Bank Limited - India
- Bukit Makmur.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Oldendorff Carriers - Singapore
- India Bulls Power Limited - India
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- Mercator Lines Limited - India
- Antam Resourcindo - Indonesia
- Star Paper Mills Limited - India
- Toyota Tsusho Corporation, Japan
- Australian Coal Association
- Trasteel International SA, Italy
- Bhoruka Overseas - Indonesia
- Gujarat Sidhee Cement - India
- Binh Thuan Hamico - Vietnam
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- Heidelberg Cement - Germany
- Ambuja Cements Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Formosa Plastics Group - Taiwan
- Aditya Birla Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Meralco Power Generation, Philippines
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