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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, 09 March 11
INDONESIA HAS SET THE MARCH 2011 INDONESIAN COAL REFERENCE PRICE FOR THERMAL COAL AT US$ 122.43 PER TON
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the March 2011 Indonesian Coal Reference Price for thermal c ...
Tuesday, 08 March 11
US$ 8 BILLION WORTH OF INFRASTRUCTURE PROJECTS IN PIPELINE IN INDONESIA - WOOD MACKENZIE
India’s Increasing Demand for Thermal Coal Cannot Be Satisfied Without Emerging Coal Areas in Indonesia - Wood Mackenzie
At Coa ...
Tuesday, 08 March 11
INDIA'S VEDANTA TO ACQUIRE COAL MINES IN OVERSEAS
COALspot.com - India's Vedanta group is also looking at long-term off take agreements and possible acquire of coal mines overseas, the official sai ...
Tuesday, 08 March 11
MINERS SAY VALUE-ADDED LAW WILL HURT IN THE LONG RUN - THE JAKARTA GLOBE
The Jakarta Globe reported that, Government plans to require miners to give added value to their exported commodities could end up costing the count ...
Tuesday, 08 March 11
THE PANAMAX MARKET THIS WEEK FIRMED UP - BRS
Underlining the unpredictability of the current market, rates for all dry bulk segments swung up again last week. Stronger exports out of South Amer ...
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- Binh Thuan Hamico - Vietnam
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- MS Steel International - UAE
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- Iligan Light & Power Inc, Philippines
- Eastern Coal Council - USA
- Altura Mining Limited, Indonesia
- Ministry of Finance - Indonesia
- Energy Development Corp, Philippines
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Sindya Power Generating Company Private Ltd
- Electricity Generating Authority of Thailand
- Australian Commodity Traders Exchange
- Sical Logistics Limited - India
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- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
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- Wood Mackenzie - Singapore
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- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
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- Central Electricity Authority - India
- Ministry of Transport, Egypt
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- Bangladesh Power Developement Board
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- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Straits Asia Resources Limited - Singapore
- OPG Power Generation Pvt Ltd - India
- Deloitte Consulting - India
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- Interocean Group of Companies - India
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- Sarangani Energy Corporation, Philippines
- Indian Energy Exchange, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
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- Kalimantan Lumbung Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Commonwealth Bank - Australia
- Therma Luzon, Inc, Philippines
- Renaissance Capital - South Africa
- Thiess Contractors Indonesia
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Makarim & Taira - Indonesia
- Coastal Gujarat Power Limited - India
- Star Paper Mills Limited - India
- Indonesian Coal Mining Association
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- Videocon Industries ltd - India
- Leighton Contractors Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- IEA Clean Coal Centre - UK
- Bayan Resources Tbk. - Indonesia
- Xindia Steels Limited - India
- Manunggal Multi Energi - Indonesia
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- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
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- Tamil Nadu electricity Board
- Australian Coal Association
- Economic Council, Georgia
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- Energy Link Ltd, New Zealand
- Globalindo Alam Lestari - Indonesia
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- Mercator Lines Limited - India
- Global Coal Blending Company Limited - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Banpu Public Company Limited - Thailand
- Parliament of New Zealand
- Port Waratah Coal Services - Australia
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- SMG Consultants - Indonesia
- McConnell Dowell - Australia
- Latin American Coal - Colombia
- Rio Tinto Coal - Australia
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Sojitz Corporation - Japan
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Aboitiz Power Corporation - Philippines
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- Toyota Tsusho Corporation, Japan
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- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Bharathi Cement Corporation - India
- Planning Commission, India
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- Sakthi Sugars Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- The Treasury - Australian Government
- Asia Pacific Energy Resources Ventures Inc, Philippines
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- Tata Chemicals Ltd - India
- ICICI Bank Limited - India
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- London Commodity Brokers - England
- Bhoruka Overseas - Indonesia
- Simpson Spence & Young - Indonesia
- Directorate Of Revenue Intelligence - India
- Lanco Infratech Ltd - India
- Mintek Dendrill Indonesia
- South Luzon Thermal Energy Corporation
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Barasentosa Lestari - Indonesia
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- The University of Queensland
- Petrochimia International Co. Ltd.- Taiwan
- Chamber of Mines of South Africa
- SMC Global Power, Philippines
- White Energy Company Limited
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Bhushan Steel Limited - India
- Medco Energi Mining Internasional
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- The State Trading Corporation of India Ltd
- ASAPP Information Group - India
- India Bulls Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Riau Bara Harum - Indonesia
- Orica Australia Pty. Ltd.
- GVK Power & Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Maheswari Brothers Coal Limited - India
- Wilmar Investment Holdings
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- Coal and Oil Company - UAE
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- Merrill Lynch Commodities Europe
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