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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, 19 April 11
LONDON COMMODITY BROKERS OPENS JOHANNESBURG OFFICE
COALspot.com - London Commodity Brokers (LCB), a broking house specialising in bulk physical and Over-The-Counter commodities and options (coal ...
Tuesday, 19 April 11
TNPL TO CONDUCT E-AUCTION TO SECURE 160,000 MT OF COAL
COALspot.com - Tamil Nadu Newsprint and Papers Limited (TNPL) a state utility of Tamil Nadu, India to conduct reverse auction on 20 April 2011, betw ...
Tuesday, 19 April 11
ADARO TO ALLOT US$100 MIO FOR COKING COAL - INSIDER STORIES
One of Indonesia's largest coal miner PT Adaro Energy Tbk (ADRO) plans to spend US$100 million in coking coal project dubbed IndoMet Coal, a joint ...
Tuesday, 19 April 11
KPCL TO OPEN PRICE BID ON 23 APRIL 2011 TO FINALIZE ITS ONE MILLION MT COAL SUPPLIER
COALspot.com - Karnataka Power Corporation (KPCL) a state utility of Karnataka, India called for open tender for supply of one million tons of 6300 ...
Monday, 18 April 11
INDONESIA HAS SET THE APRIL 2011 COAL REFERENCE PRICE FOR THERMAL COAL AT US$ 122.02 PER TON
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has set the April 2011 Indonesian Coal Reference Price for thermal coal at ...
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- International Coal Ventures Pvt Ltd - India
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- Deloitte Consulting - India
- TeaM Sual Corporation - Philippines
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Cement Manufacturers Association - India
- Therma Luzon, Inc, Philippines
- Tata Chemicals Ltd - India
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Star Paper Mills Limited - India
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- Parliament of New Zealand
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- Singapore Mercantile Exchange
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- Siam City Cement PLC, Thailand
- Lanco Infratech Ltd - India
- Alfred C Toepfer International GmbH - Germany
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- SMC Global Power, Philippines
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- Samtan Co., Ltd - South Korea
- Altura Mining Limited, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
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- Metalloyd Limited - United Kingdom
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- Economic Council, Georgia
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- Australian Coal Association
- Salva Resources Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- Sakthi Sugars Limited - India
- Planning Commission, India
- Ministry of Mines - Canada
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Directorate General of MIneral and Coal - Indonesia
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- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- IEA Clean Coal Centre - UK
- MS Steel International - UAE
- Eastern Energy - Thailand
- Ministry of Finance - Indonesia
- Indogreen Group - Indonesia
- Goldman Sachs - Singapore
- South Luzon Thermal Energy Corporation
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indonesian Coal Mining Association
- Marubeni Corporation - India
- Energy Link Ltd, New Zealand
- Bhushan Steel Limited - India
- Commonwealth Bank - Australia
- Leighton Contractors Pty Ltd - Australia
- GMR Energy Limited - India
- Meralco Power Generation, Philippines
- Port Waratah Coal Services - Australia
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- The Treasury - Australian Government
- Essar Steel Hazira Ltd - India
- Thiess Contractors Indonesia
- VISA Power Limited - India
- Mercator Lines Limited - India
- Standard Chartered Bank - UAE
- Gujarat Sidhee Cement - India
- Kumho Petrochemical, South Korea
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Latin American Coal - Colombia
- Toyota Tsusho Corporation, Japan
- Minerals Council of Australia
- Meenaskhi Energy Private Limited - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- Agrawal Coal Company - India
- Chamber of Mines of South Africa
- Coalindo Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Renaissance Capital - South Africa
- Timah Investasi Mineral - Indoneisa
- Kepco SPC Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
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- Jorong Barutama Greston.PT - Indonesia
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Barasentosa Lestari - Indonesia
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- Kohat Cement Company Ltd. - Pakistan
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- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
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- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Intertek Mineral Services - Indonesia
- White Energy Company Limited
- GN Power Mariveles Coal Plant, Philippines
- PTC India Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Bangladesh Power Developement Board
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Edison Trading Spa - Italy
- Global Coal Blending Company Limited - Australia
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- Posco Energy - South Korea
- Eastern Coal Council - USA
- IHS Mccloskey Coal Group - USA
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- The University of Queensland
- McConnell Dowell - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Independent Power Producers Association of India
- Oldendorff Carriers - Singapore
- Banpu Public Company Limited - Thailand
- CIMB Investment Bank - Malaysia
- Indika Energy - Indonesia
- Xindia Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Manunggal Multi Energi - Indonesia
- Merrill Lynch Commodities Europe
- Orica Mining Services - Indonesia
- Mintek Dendrill Indonesia
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Bayan Resources Tbk. - Indonesia
- Medco Energi Mining Internasional
- Tamil Nadu electricity Board
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- SN Aboitiz Power Inc, Philippines
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- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- CNBM International Corporation - China
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- Grasim Industreis Ltd - India
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