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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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Sunday, 28 November 10
FREIGHT MARKET SEEMS TO BE NERVOUS - VISTAAR
COALspot.com - The freight market continued to remain uncertain even though only cape index was down by 8.31 pct.
Overall the market seems to be ...
Friday, 26 November 10
INDIA WILL IMPORT 100 MLN TONS OF COAL BY 2012 - LAKSHMINARAYANA
COALspot.com – “India’s coal shortfall will reach 100 million mt by 2011-12”, said Lakshminarayana, Vice Preside ...
Friday, 26 November 10
CHINAS COAL INVENTORY STAYS HIGH FOR 22 MONTHS AT 220 MLN T, ASSOCIATION
Xinhua News Agency reported that, China’s coal inventory has stayed high and unchanged for 22 months to be around 220 million tonnes, reflecti ...
Friday, 26 November 10
DR WOLFGANG CIESLIK TO HEAD GERMAN COAL IMPORTERS ASSOCIATION
COALspot.com – (Press Release): The Management Board of the German Coal Importers Association (Verein der Kohlenimporteure e.V.) has elected D ...
Thursday, 25 November 10
ANALYSIS: COAL SECTOR: VALUE EMERGENCE - THE JAKARTA POST
Coal demand will remain firm due to a build-up of coal-fired power plants in India, China and Indonesia. As a result, we have upgraded our coal pric ...
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- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- Minerals Council of Australia
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Australian Commodity Traders Exchange
- Africa Commodities Group - South Africa
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Xindia Steels Limited - India
- International Coal Ventures Pvt Ltd - India
- Economic Council, Georgia
- Wilmar Investment Holdings
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- GAC Shipping (India) Pvt Ltd
- Intertek Mineral Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Bukit Baiduri Energy - Indonesia
- Bharathi Cement Corporation - India
- Wood Mackenzie - Singapore
- Sinarmas Energy and Mining - Indonesia
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- Siam City Cement - Thailand
- AsiaOL BioFuels Corp., Philippines
- Marubeni Corporation - India
- Energy Link Ltd, New Zealand
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- Anglo American - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- SN Aboitiz Power Inc, Philippines
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- IEA Clean Coal Centre - UK
- Simpson Spence & Young - Indonesia
- Petron Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Pendopo Energi Batubara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Maheswari Brothers Coal Limited - India
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
- OPG Power Generation Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Coal and Oil Company - UAE
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- Tamil Nadu electricity Board
- PNOC Exploration Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Edison Trading Spa - Italy
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ministry of Mines - Canada
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Electricity Generating Authority of Thailand
- Energy Development Corp, Philippines
- Merrill Lynch Commodities Europe
- Kalimantan Lumbung Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining Corp, Philippines
- Jindal Steel & Power Ltd - India
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Global Green Power PLC Corporation, Philippines
- Australian Coal Association
- Singapore Mercantile Exchange
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- Georgia Ports Authority, United States
- The Treasury - Australian Government
- Standard Chartered Bank - UAE
- Borneo Indobara - Indonesia
- Therma Luzon, Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Timah Investasi Mineral - Indoneisa
- CNBM International Corporation - China
- MS Steel International - UAE
- Baramulti Group, Indonesia
- Indogreen Group - Indonesia
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Sakthi Sugars Limited - India
- Toyota Tsusho Corporation, Japan
- Attock Cement Pakistan Limited
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Indian Oil Corporation Limited
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Oldendorff Carriers - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Makarim & Taira - Indonesia
- Siam City Cement PLC, Thailand
- Metalloyd Limited - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Global Business Power Corporation, Philippines
- GMR Energy Limited - India
- Trasteel International SA, Italy
- Star Paper Mills Limited - India
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- India Bulls Power Limited - India
- Meenaskhi Energy Private Limited - India
- Leighton Contractors Pty Ltd - Australia
- Eastern Coal Council - USA
- Grasim Industreis Ltd - India
- Renaissance Capital - South Africa
- Sical Logistics Limited - India
- Rio Tinto Coal - Australia
- Salva Resources Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Savvy Resources Ltd - HongKong
- Bhoruka Overseas - Indonesia
- The University of Queensland
- Tata Chemicals Ltd - India
- Commonwealth Bank - Australia
- PetroVietnam Power Coal Import and Supply Company
- San Jose City I Power Corp, Philippines
- ASAPP Information Group - India
- Interocean Group of Companies - India
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Orica Australia Pty. Ltd.
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Parry Sugars Refinery, India
- Miang Besar Coal Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Carbofer General Trading SA - India
- Sree Jayajothi Cements Limited - India
- Mercator Lines Limited - India
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Karaikal Port Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- CIMB Investment Bank - Malaysia
- LBH Netherlands Bv - Netherlands
- Straits Asia Resources Limited - Singapore
- Ministry of Transport, Egypt
- Agrawal Coal Company - India
- Global Coal Blending Company Limited - Australia
- Rashtriya Ispat Nigam Limited - India
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- Bukit Makmur.PT - Indonesia
- Goldman Sachs - Singapore
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Essar Steel Hazira Ltd - India
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- White Energy Company Limited
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Posco Energy - South Korea
- London Commodity Brokers - England
- Coalindo Energy - Indonesia
- Independent Power Producers Association of India
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- Binh Thuan Hamico - Vietnam
- GVK Power & Infra Limited - India
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