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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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Friday, 17 December 10
NALCO SHORTLISTS COAL FIRMS FOR INDONESIA PROJECT - BUSINESS-STANDARD
Business-Standard reported that, State-owned NALCO today said it has shortlisted two firms for supply of coal for its Rs 18,000-crore (US$ 3,953,003 ...
Thursday, 16 December 10
LANCO BAGS AUSTRALIAN COAL MINER GRIFFITH - DNA
As part of its strategy to secure coal supplies for meeting its needs in expanding power generation capacities, infrastructure major Lanco Infratech ...
Thursday, 16 December 10
COAL INDIA IN TALKS WITH INDONESIAN CO TO BUY ITS COAL MINES - APN NEWS
APN News reported that, World’s largest coal producer Coal India is in talks with Indonesia’s Sinar Mas Group for acquiring coal mines i ...
Wednesday, 15 December 10
GOVT SETS NEW MINIMUM LEVEL FOR DOMESTIC MARKET SALES - THE JAKARTA POST
The Jakarta Post reported that, Indonesian coal producers are required to sell at least 24.17 percent of their production to the domestic market nex ...
Wednesday, 15 December 10
CAPESIZE RATES ARE NOW AT THEIR LOWEST LEVEL SINCE AUGUST
It was a repeat performance for the market this week, with another increase in earnings for the small sizes but a sharp drop for the Capes. Overall ...
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- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- Eastern Energy - Thailand
- GMR Energy Limited - India
- Posco Energy - South Korea
- Bulk Trading Sa - Switzerland
- SMG Consultants - Indonesia
- Lanco Infratech Ltd - India
- IHS Mccloskey Coal Group - USA
- Riau Bara Harum - Indonesia
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Merrill Lynch Commodities Europe
- Thai Mozambique Logistica
- Minerals Council of Australia
- India Bulls Power Limited - India
- Kaltim Prima Coal - Indonesia
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- Indian Oil Corporation Limited
- Indogreen Group - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- MS Steel International - UAE
- Therma Luzon, Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Energy Link Ltd, New Zealand
- Planning Commission, India
- Indo Tambangraya Megah - Indonesia
- Siam City Cement - Thailand
- AsiaOL BioFuels Corp., Philippines
- Africa Commodities Group - South Africa
- Romanian Commodities Exchange
- Globalindo Alam Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- London Commodity Brokers - England
- Energy Development Corp, Philippines
- Wilmar Investment Holdings
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Maheswari Brothers Coal Limited - India
- Chettinad Cement Corporation Ltd - India
- Ministry of Finance - Indonesia
- White Energy Company Limited
- Bukit Makmur.PT - Indonesia
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Mjunction Services Limited - India
- Straits Asia Resources Limited - Singapore
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- Sree Jayajothi Cements Limited - India
- Latin American Coal - Colombia
- Central Java Power - Indonesia
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
- ICICI Bank Limited - India
- Interocean Group of Companies - India
- Coalindo Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Ambuja Cements Ltd - India
- Uttam Galva Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Mercator Lines Limited - India
- Orica Australia Pty. Ltd.
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- Agrawal Coal Company - India
- Star Paper Mills Limited - India
- Timah Investasi Mineral - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Meenaskhi Energy Private Limited - India
- Karaikal Port Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- CNBM International Corporation - China
- Bhatia International Limited - India
- Larsen & Toubro Limited - India
- Mercuria Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Metalloyd Limited - United Kingdom
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Manunggal Multi Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Binh Thuan Hamico - Vietnam
- Cement Manufacturers Association - India
- Anglo American - United Kingdom
- Attock Cement Pakistan Limited
- ASAPP Information Group - India
- Asmin Koalindo Tuhup - Indonesia
- Malabar Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Thiess Contractors Indonesia
- Coal and Oil Company - UAE
- PTC India Limited - India
- Wood Mackenzie - Singapore
- Formosa Plastics Group - Taiwan
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Mining Services - Indonesia
- Electricity Authority, New Zealand
- Power Finance Corporation Ltd., India
- Electricity Generating Authority of Thailand
- Gujarat Sidhee Cement - India
- Indian Energy Exchange, India
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Dalmia Cement Bharat India
- Holcim Trading Pte Ltd - Singapore
- SMC Global Power, Philippines
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- New Zealand Coal & Carbon
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Goldman Sachs - Singapore
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Intertek Mineral Services - Indonesia
- Bhoruka Overseas - Indonesia
- TeaM Sual Corporation - Philippines
- GVK Power & Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Grasim Industreis Ltd - India
- The State Trading Corporation of India Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indonesian Coal Mining Association
- Barasentosa Lestari - Indonesia
- Mintek Dendrill Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- SN Aboitiz Power Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- Oldendorff Carriers - Singapore
- Rio Tinto Coal - Australia
- Global Coal Blending Company Limited - Australia
- Karbindo Abesyapradhi - Indoneisa
- Indika Energy - Indonesia
- Renaissance Capital - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- Antam Resourcindo - Indonesia
- San Jose City I Power Corp, Philippines
- Kumho Petrochemical, South Korea
- Ind-Barath Power Infra Limited - India
- Jaiprakash Power Ventures ltd
- Marubeni Corporation - India
- Aditya Birla Group - India
- Kohat Cement Company Ltd. - Pakistan
- Kartika Selabumi Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Kobexindo Tractors - Indoneisa
- The University of Queensland
- Georgia Ports Authority, United States
- Madhucon Powers Ltd - India
- Salva Resources Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- CIMB Investment Bank - Malaysia
- Cigading International Bulk Terminal - Indonesia
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- LBH Netherlands Bv - Netherlands
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- South Luzon Thermal Energy Corporation
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