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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, 26 January 11
DRY BULK MARKET TAKES YET ANOTHER NOSEDIVE, CAPESIZES LOOK RATHER UNATTRACTIVE AT THE MOMENT - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The downturn of the dry bulk market sees no boundariers, disproving even those who thought that at least for the capesize market, the worst had pass ...
Tuesday, 25 January 11
DRY BULK RATES CONTINUED TO TUMBLE LAST WEEK - BRS
With weather-related problems affecting the short-term outlook, and new building deliveries the longer-term picture, dry bulk rates continued to tum ...
Tuesday, 25 January 11
R-POWER TO INVEST $5BN IN INDONESIA - THE TIMES OF INDIA
The Times of India reported that, In what is being seen as one of the largest foreign investments in Indonesia, Reliance Power will infuse $5 billio ...
Monday, 24 January 11
GOVT PROMISES COAL FOR PLN DESPITE PRICE SPIKES - THE JAKARTA POST
The Jakarta Post reported that, the government says state electricity company PT PLN will receive enough coal to fire its power plants, despite pric ...
Monday, 24 January 11
DRY BULK MARKETS DOWNTURN SEES NO RELIEF - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept falling for yet another week, with the industry’s benchmark, the Baltic Dry Index (BDI) losing an additional 4.79 ...
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- Globalindo Alam Lestari - Indonesia
- CNBM International Corporation - China
- Minerals Council of Australia
- Edison Trading Spa - Italy
- Oldendorff Carriers - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kapuas Tunggal Persada - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Sindya Power Generating Company Private Ltd
- Coastal Gujarat Power Limited - India
- Barasentosa Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- White Energy Company Limited
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Indo Tambangraya Megah - Indonesia
- Indian Energy Exchange, India
- OPG Power Generation Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Independent Power Producers Association of India
- Planning Commission, India
- Parliament of New Zealand
- Latin American Coal - Colombia
- Siam City Cement PLC, Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Renaissance Capital - South Africa
- Merrill Lynch Commodities Europe
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- The Treasury - Australian Government
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- Heidelberg Cement - Germany
- Eastern Coal Council - USA
- London Commodity Brokers - England
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Standard Chartered Bank - UAE
- VISA Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Riau Bara Harum - Indonesia
- Makarim & Taira - Indonesia
- Kideco Jaya Agung - Indonesia
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Interocean Group of Companies - India
- Baramulti Group, Indonesia
- Global Business Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Formosa Plastics Group - Taiwan
- SMC Global Power, Philippines
- Krishnapatnam Port Company Ltd. - India
- ASAPP Information Group - India
- Eastern Energy - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Star Paper Mills Limited - India
- Kumho Petrochemical, South Korea
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- Goldman Sachs - Singapore
- Mjunction Services Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Sical Logistics Limited - India
- GVK Power & Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- PowerSource Philippines DevCo
- Economic Council, Georgia
- Metalloyd Limited - United Kingdom
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Ind-Barath Power Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Thiess Contractors Indonesia
- Miang Besar Coal Terminal - Indonesia
- PTC India Limited - India
- Kartika Selabumi Mining - Indonesia
- Indian Oil Corporation Limited
- Petrochimia International Co. Ltd.- Taiwan
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Trasteel International SA, Italy
- Holcim Trading Pte Ltd - Singapore
- Sakthi Sugars Limited - India
- Orica Australia Pty. Ltd.
- Bulk Trading Sa - Switzerland
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Bhoruka Overseas - Indonesia
- TeaM Sual Corporation - Philippines
- Larsen & Toubro Limited - India
- Ceylon Electricity Board - Sri Lanka
- India Bulls Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Central Electricity Authority - India
- Therma Luzon, Inc, Philippines
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Authority, New Zealand
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vedanta Resources Plc - India
- Posco Energy - South Korea
- Videocon Industries ltd - India
- Australian Coal Association
- Medco Energi Mining Internasional
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The State Trading Corporation of India Ltd
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- McConnell Dowell - Australia
- Bangladesh Power Developement Board
- Petron Corporation, Philippines
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Australian Commodity Traders Exchange
- Orica Mining Services - Indonesia
- Tamil Nadu electricity Board
- Madhucon Powers Ltd - India
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- LBH Netherlands Bv - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Intertek Mineral Services - Indonesia
- Altura Mining Limited, Indonesia
- Indika Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Bhushan Steel Limited - India
- Chamber of Mines of South Africa
- ICICI Bank Limited - India
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Wood Mackenzie - Singapore
- Maheswari Brothers Coal Limited - India
- Anglo American - United Kingdom
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- Toyota Tsusho Corporation, Japan
- Energy Development Corp, Philippines
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- SMG Consultants - Indonesia
- Kepco SPC Power Corporation, Philippines
- Romanian Commodities Exchange
- Carbofer General Trading SA - India
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- European Bulk Services B.V. - Netherlands
- IHS Mccloskey Coal Group - USA
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- Malabar Cements Ltd - India
- Aditya Birla Group - India
- Jorong Barutama Greston.PT - Indonesia
- Pendopo Energi Batubara - Indonesia
- San Jose City I Power Corp, Philippines
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- CIMB Investment Bank - Malaysia
- Coalindo Energy - Indonesia
- Bhatia International Limited - India
- Africa Commodities Group - South Africa
- Essar Steel Hazira Ltd - India
- Samtan Co., Ltd - South Korea
- Electricity Generating Authority of Thailand
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
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