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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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Monday, 13 December 10
ICE FUTURES EUROPE TO LAUNCH IHS MCCLOSKEY INDONESIAN SUB-BITUMINOUS FOB MARKER COAL CONTRACTS - MONDOVISIONE
Mondovisione reported that, IntercontinentalExchange (NYSE: ICE), a leading operator of global regulated futures exchanges, clearing houses and over ...
Monday, 13 December 10
NALCO TO START WORK ON RS 18K CR ($ 4,010,695,091) INDONESIAN PROJECT BY JUNE - MSN
MSN reported that, State-owned NALCO today said it has selected UAE-based RAK Minerals as JV partner for its Rs 18,000 crore (US$ 4,010,695,091 ...
Monday, 13 December 10
DEUTSCHE BANK RAISES COAL FORECASTS ON MARKET SHORTAGE - BLOOMBERG
Deutsche Bank AG raised price forecasts for thermal coal by as much as 17 percent on expectations that a shortage of the fuel will widen over the ne ...
Monday, 13 December 10
K SERA SERA TO SPEND RS325CR TO BUY COAL,OIL & GAS FIRMS STAKE - LIVE MINT
The company might have to dole out around Rs 225 crore (US$ 50,122,522) for picking up the majority stake in the coal mine in Indonesia and around R ...
Thursday, 09 December 10
OVERSUPPLY OF SHIPS BOUND TO KEEP DRY BULK FREIGHT RATES SUBDUED DURING 2011 SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
An oversupply of vessels is expected to keep freight rates from flying as high as in recent years said a relative shipping report from BIMCO’s ...
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- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- Bhatia International Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Merrill Lynch Commodities Europe
- Siam City Cement PLC, Thailand
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
- Bulk Trading Sa - Switzerland
- Neyveli Lignite Corporation Ltd, - India
- Edison Trading Spa - Italy
- Videocon Industries ltd - India
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Sical Logistics Limited - India
- The University of Queensland
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- Rio Tinto Coal - Australia
- Meralco Power Generation, Philippines
- Indian Oil Corporation Limited
- Minerals Council of Australia
- Energy Link Ltd, New Zealand
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- Bahari Cakrawala Sebuku - Indonesia
- Banpu Public Company Limited - Thailand
- GVK Power & Infra Limited - India
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- Wilmar Investment Holdings
- Australian Coal Association
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- Tata Chemicals Ltd - India
- Salva Resources Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Commonwealth Bank - Australia
- Global Coal Blending Company Limited - Australia
- Indogreen Group - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Pendopo Energi Batubara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Coalindo Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Renaissance Capital - South Africa
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cigading International Bulk Terminal - Indonesia
- European Bulk Services B.V. - Netherlands
- Cement Manufacturers Association - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Semirara Mining and Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Ministry of Mines - Canada
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- Bukit Makmur.PT - Indonesia
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- Kideco Jaya Agung - Indonesia
- Intertek Mineral Services - Indonesia
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Mintek Dendrill Indonesia
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- Larsen & Toubro Limited - India
- Semirara Mining Corp, Philippines
- Formosa Plastics Group - Taiwan
- Orica Mining Services - Indonesia
- Malabar Cements Ltd - India
- Planning Commission, India
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Chettinad Cement Corporation Ltd - India
- Aditya Birla Group - India
- White Energy Company Limited
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Metalloyd Limited - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- San Jose City I Power Corp, Philippines
- Grasim Industreis Ltd - India
- Trasteel International SA, Italy
- Parliament of New Zealand
- Coastal Gujarat Power Limited - India
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Ind-Barath Power Infra Limited - India
- Singapore Mercantile Exchange
- Central Java Power - Indonesia
- Kepco SPC Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- VISA Power Limited - India
- Directorate Of Revenue Intelligence - India
- Straits Asia Resources Limited - Singapore
- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Orica Australia Pty. Ltd.
- International Coal Ventures Pvt Ltd - India
- Sakthi Sugars Limited - India
- Baramulti Group, Indonesia
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- McConnell Dowell - Australia
- Chamber of Mines of South Africa
- Gujarat Electricity Regulatory Commission - India
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Karaikal Port Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Economic Council, Georgia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- Heidelberg Cement - Germany
- Altura Mining Limited, Indonesia
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- Iligan Light & Power Inc, Philippines
- Ministry of Transport, Egypt
- New Zealand Coal & Carbon
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- GMR Energy Limited - India
- Carbofer General Trading SA - India
- PowerSource Philippines DevCo
- Simpson Spence & Young - Indonesia
- Maheswari Brothers Coal Limited - India
- Antam Resourcindo - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Indika Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Therma Luzon, Inc, Philippines
- Madhucon Powers Ltd - India
- Georgia Ports Authority, United States
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Medco Energi Mining Internasional
- Thiess Contractors Indonesia
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Savvy Resources Ltd - HongKong
- Mjunction Services Limited - India
- Miang Besar Coal Terminal - Indonesia
- PTC India Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- MS Steel International - UAE
- Global Business Power Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- IEA Clean Coal Centre - UK
- Wood Mackenzie - Singapore
- Alfred C Toepfer International GmbH - Germany
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- Agrawal Coal Company - India
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Eastern Energy - Thailand
- Sinarmas Energy and Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- Tamil Nadu electricity Board
- Australian Commodity Traders Exchange
- Posco Energy - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Energy Development Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- The Treasury - Australian Government
- Gujarat Sidhee Cement - India
- OPG Power Generation Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Indo Tambangraya Megah - Indonesia
- Ministry of Finance - Indonesia
- Bayan Resources Tbk. - Indonesia
- Interocean Group of Companies - India
- Riau Bara Harum - Indonesia
- ICICI Bank Limited - India
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- CIMB Investment Bank - Malaysia
- Oldendorff Carriers - Singapore
- Sarangani Energy Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- Independent Power Producers Association of India
- Eastern Coal Council - USA
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