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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, 13 January 11
DRY BULK RATES HIT NEW MULTI-MONTH LOWS ON AUSTRALIAS FLOODS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Floods in Australia’s Queensland has seriously disrupted coal shipments and together with a flood of vessels has pushed freight rates for dry ...
Wednesday, 12 January 11
BULKER DELIVERIES WEIGHING IN ON FREIGHT RATES KEEPING SENTIMENT ON A NEGATIVE MODE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A flurry of new buildings still hitting the water has caught up for good with the freight market, with capesizes unable to weather the storm. With r ...
Tuesday, 11 January 11
SUPRAMAX TRIP VIA INDONESIA TO INDIA US$ 8,000 PER DAY
Despite continued growth in the bulk trades, the delivery of new vessels is beginning to take its toll. The BDI continued its decline, finishing las ...
Tuesday, 11 January 11
DRY BULK MARKET REACHES NEW LOWS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market’s benchmark index, the Baltic Dry Index (BDI) lost further ground in the beginning of the week, following the trend of the ...
Monday, 10 January 11
MINING INVESTMENT TARGET TOO LOW - TEMPO INTERACTIVE
TEMPO Interactive reported that, the Indonesian Mining Association’s executive director, Priyo Pribadi, believes the government’s invest ...
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- Energy Development Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- OPG Power Generation Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- ASAPP Information Group - India
- Jorong Barutama Greston.PT - Indonesia
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Leighton Contractors Pty Ltd - Australia
- Dalmia Cement Bharat India
- Salva Resources Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Neyveli Lignite Corporation Ltd, - India
- Attock Cement Pakistan Limited
- Vizag Seaport Private Limited - India
- Kideco Jaya Agung - Indonesia
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Sarangani Energy Corporation, Philippines
- Singapore Mercantile Exchange
- Ministry of Finance - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Cement Manufacturers Association - India
- SN Aboitiz Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Global Green Power PLC Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Antam Resourcindo - Indonesia
- Sojitz Corporation - Japan
- MS Steel International - UAE
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Altura Mining Limited, Indonesia
- Merrill Lynch Commodities Europe
- London Commodity Brokers - England
- Australian Coal Association
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Heidelberg Cement - Germany
- Kobexindo Tractors - Indoneisa
- Meenaskhi Energy Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- LBH Netherlands Bv - Netherlands
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Agrawal Coal Company - India
- Cigading International Bulk Terminal - Indonesia
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- Grasim Industreis Ltd - India
- Thai Mozambique Logistica
- Eastern Energy - Thailand
- Rio Tinto Coal - Australia
- PTC India Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indonesian Coal Mining Association
- Uttam Galva Steels Limited - India
- Baramulti Group, Indonesia
- Banpu Public Company Limited - Thailand
- Krishnapatnam Port Company Ltd. - India
- Kartika Selabumi Mining - Indonesia
- Bhatia International Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- Planning Commission, India
- Commonwealth Bank - Australia
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Kaltim Prima Coal - Indonesia
- Posco Energy - South Korea
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Therma Luzon, Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Medco Energi Mining Internasional
- Global Coal Blending Company Limited - Australia
- Formosa Plastics Group - Taiwan
- Aditya Birla Group - India
- Port Waratah Coal Services - Australia
- IHS Mccloskey Coal Group - USA
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- Karaikal Port Pvt Ltd - India
- New Zealand Coal & Carbon
- SMC Global Power, Philippines
- Star Paper Mills Limited - India
- Samtan Co., Ltd - South Korea
- Savvy Resources Ltd - HongKong
- Minerals Council of Australia
- Bhushan Steel Limited - India
- Chamber of Mines of South Africa
- Africa Commodities Group - South Africa
- Jindal Steel & Power Ltd - India
- Renaissance Capital - South Africa
- Edison Trading Spa - Italy
- Indika Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Tamil Nadu electricity Board
- Karbindo Abesyapradhi - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Coastal Gujarat Power Limited - India
- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- GVK Power & Infra Limited - India
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Barasentosa Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Sical Logistics Limited - India
- Electricity Authority, New Zealand
- Sinarmas Energy and Mining - Indonesia
- The Treasury - Australian Government
- Independent Power Producers Association of India
- Borneo Indobara - Indonesia
- Carbofer General Trading SA - India
- Semirara Mining and Power Corporation, Philippines
- SMG Consultants - Indonesia
- Central Electricity Authority - India
- Wilmar Investment Holdings
- Romanian Commodities Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Simpson Spence & Young - Indonesia
- India Bulls Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Globalindo Alam Lestari - Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- Sakthi Sugars Limited - India
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Coalindo Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- The University of Queensland
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Jaiprakash Power Ventures ltd
- Ministry of Transport, Egypt
- AsiaOL BioFuels Corp., Philippines
- Bharathi Cement Corporation - India
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- PetroVietnam Power Coal Import and Supply Company
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Larsen & Toubro Limited - India
- Gujarat Electricity Regulatory Commission - India
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- The State Trading Corporation of India Ltd
- Tata Chemicals Ltd - India
- Gujarat Sidhee Cement - India
- Asmin Koalindo Tuhup - Indonesia
- Thiess Contractors Indonesia
- Vedanta Resources Plc - India
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Orica Australia Pty. Ltd.
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Sindya Power Generating Company Private Ltd
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- Latin American Coal - Colombia
- Semirara Mining Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- CIMB Investment Bank - Malaysia
- Ambuja Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Malabar Cements Ltd - India
- Anglo American - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Iligan Light & Power Inc, Philippines
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