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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, 21 July 10
CHARTER RATES FOR BIG SHIPS GO INTO FREEFALL
It is reported that concerns over the slowdown in the mainland construction sector posturing over ore price negotiations and a general summer slowdo ...
Wednesday, 21 July 10
FEWER SHIPS SOLD FOR SCRAP IN JUNE, ADDING PRESSURE TO FREIGHT RATES
The easing of vessel tonnage supply should be among the main concerns among ship owners, especially those active in dry bulk shipping. The reason is ...
Wednesday, 21 July 10
BUKIT ASAM SEALS RP900 BIO COAL DEAL
Souce: Insider Stories
Insider Stories reported that, State-Owned coal producer PT Tambang Batubara Bukit Asam Tbk (PTBA) have agreed t ...
Wednesday, 21 July 10
TUAH TURANGGA BUYS ABP US$ 15.9 MIO
Source: Insider Stories
Insider Stories reported that, Komatsu heavy equipment PT United Tractors Tbk (UNTR) through its wh ...
Tuesday, 20 July 10
CHINA'S RELIANCE ON COAL TO DROP 7% BY 2015 - XINHUA NET
Xinhua Net reported that, China's coal consumption is likely to drop to 63 percent of total energy consumption by 2015, down from 70 percent last y ...
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- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- Australian Coal Association
- Parliament of New Zealand
- Sojitz Corporation - Japan
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Posco Energy - South Korea
- Salva Resources Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- PNOC Exploration Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Antam Resourcindo - Indonesia
- Central Electricity Authority - India
- Star Paper Mills Limited - India
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Energy Link Ltd, New Zealand
- Power Finance Corporation Ltd., India
- Eastern Coal Council - USA
- IEA Clean Coal Centre - UK
- Karaikal Port Pvt Ltd - India
- GMR Energy Limited - India
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Agrawal Coal Company - India
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Vedanta Resources Plc - India
- VISA Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Minerals Council of Australia
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vizag Seaport Private Limited - India
- Intertek Mineral Services - Indonesia
- Carbofer General Trading SA - India
- Port Waratah Coal Services - Australia
- Sree Jayajothi Cements Limited - India
- Timah Investasi Mineral - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Orica Australia Pty. Ltd.
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Kumho Petrochemical, South Korea
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- Eastern Energy - Thailand
- Economic Council, Georgia
- Xindia Steels Limited - India
- The Treasury - Australian Government
- Semirara Mining Corp, Philippines
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Larsen & Toubro Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Singapore Mercantile Exchange
- Mjunction Services Limited - India
- Uttam Galva Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Kalimantan Lumbung Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Borneo Indobara - Indonesia
- Global Green Power PLC Corporation, Philippines
- Mercuria Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Jindal Steel & Power Ltd - India
- Aboitiz Power Corporation - Philippines
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Kapuas Tunggal Persada - Indonesia
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Independent Power Producers Association of India
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- Barasentosa Lestari - Indonesia
- Electricity Authority, New Zealand
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Gujarat Mineral Development Corp Ltd - India
- Deloitte Consulting - India
- Bahari Cakrawala Sebuku - Indonesia
- Sakthi Sugars Limited - India
- Planning Commission, India
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
- Bukit Makmur.PT - Indonesia
- Ministry of Finance - Indonesia
- The University of Queensland
- Malabar Cements Ltd - India
- Coastal Gujarat Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Romanian Commodities Exchange
- Sical Logistics Limited - India
- Mercator Lines Limited - India
- Sinarmas Energy and Mining - Indonesia
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Thai Mozambique Logistica
- Indian Oil Corporation Limited
- Indian Energy Exchange, India
- MS Steel International - UAE
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Global Business Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Leighton Contractors Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Mintek Dendrill Indonesia
- Metalloyd Limited - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Samtan Co., Ltd - South Korea
- Bayan Resources Tbk. - Indonesia
- Lanco Infratech Ltd - India
- Anglo American - United Kingdom
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Ministry of Mines - Canada
- SMC Global Power, Philippines
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Kaltim Prima Coal - Indonesia
- Petron Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Chamber of Mines of South Africa
- Commonwealth Bank - Australia
- Miang Besar Coal Terminal - Indonesia
- Heidelberg Cement - Germany
- GVK Power & Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- The State Trading Corporation of India Ltd
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- Central Java Power - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Standard Chartered Bank - UAE
- Bangladesh Power Developement Board
- Sarangani Energy Corporation, Philippines
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PTC India Limited - India
- Coal and Oil Company - UAE
- Iligan Light & Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Simpson Spence & Young - Indonesia
- European Bulk Services B.V. - Netherlands
- ASAPP Information Group - India
- Oldendorff Carriers - Singapore
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- Indonesian Coal Mining Association
- AsiaOL BioFuels Corp., Philippines
- Semirara Mining and Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Toyota Tsusho Corporation, Japan
- Bhatia International Limited - India
- LBH Netherlands Bv - Netherlands
- Indika Energy - Indonesia
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- ICICI Bank Limited - India
- Gujarat Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- PetroVietnam Power Coal Import and Supply Company
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