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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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Tuesday, 13 July 10
FURTHER LOSSES FOR BALTIC DRY INDEX ON HIGH VESSEL SUPPLY
The dry bulk market can’t catch a breath, as it has now entered the 7th straight week of losses. The industry’s benchmark, the Baltic Dr ...
Sunday, 11 July 10
OVERALL NO OR NEGLIGIBLE IMPACT IN ARUTMIN MINE - BUMI
COALspot.com: Bumi denies the media reports on an impact of unusually rains on coal production in BUMI mines.
"Arutmin is being impacted by ...
Saturday, 10 July 10
FREIGHT MARKET SITUATION MAY CONTINUE FOR NEXT COUPLE OF WEEKS - VISTAAR
COALspot.com: The market continued to soften further with the cape and panamax index down by about 20 pct and closed at 2,102 and 1,944 points respe ...
Saturday, 10 July 10
STC OF INDIA TO ASSOCIATE WITH FUEL SUPPLIERS
COALspot.com: State Trading corporation of India, which is under Ministry of Commerce, has invited Expression of Interest from coal suppliers ...
Saturday, 10 July 10
SCOMI TO SELL STAKE IN INDONESIA OPS - THE STAR
The star online reported that, Scomi Marine Bhd will sell a stake in its marine logistics business in Indonesia to a large Indonesian company to dea ...
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- Interocean Group of Companies - India
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- Anglo American - United Kingdom
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Wilmar Investment Holdings
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Lanco Infratech Ltd - India
- Maheswari Brothers Coal Limited - India
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- PNOC Exploration Corporation - Philippines
- Kumho Petrochemical, South Korea
- Mercator Lines Limited - India
- Xindia Steels Limited - India
- Globalindo Alam Lestari - Indonesia
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Thai Mozambique Logistica
- SN Aboitiz Power Inc, Philippines
- Siam City Cement - Thailand
- Mjunction Services Limited - India
- Bukit Baiduri Energy - Indonesia
- Borneo Indobara - Indonesia
- The University of Queensland
- Indian Oil Corporation Limited
- Petron Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Minerals Council of Australia
- Antam Resourcindo - Indonesia
- PTC India Limited - India
- European Bulk Services B.V. - Netherlands
- Indika Energy - Indonesia
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- Wood Mackenzie - Singapore
- Meralco Power Generation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Medco Energi Mining Internasional
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Central Java Power - Indonesia
- Ministry of Finance - Indonesia
- Energy Development Corp, Philippines
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Gujarat Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- Billiton Holdings Pty Ltd - Australia
- Leighton Contractors Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Kartika Selabumi Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ceylon Electricity Board - Sri Lanka
- Aboitiz Power Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- Videocon Industries ltd - India
- Holcim Trading Pte Ltd - Singapore
- Indogreen Group - Indonesia
- Mintek Dendrill Indonesia
- Indo Tambangraya Megah - Indonesia
- South Luzon Thermal Energy Corporation
- Latin American Coal - Colombia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- Sical Logistics Limited - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Semirara Mining Corp, Philippines
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Makarim & Taira - Indonesia
- SMC Global Power, Philippines
- Simpson Spence & Young - Indonesia
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Barasentosa Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- White Energy Company Limited
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Singapore Mercantile Exchange
- Sakthi Sugars Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Meenaskhi Energy Private Limited - India
- Global Green Power PLC Corporation, Philippines
- Gujarat Sidhee Cement - India
- Thiess Contractors Indonesia
- Altura Mining Limited, Indonesia
- Vedanta Resources Plc - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Renaissance Capital - South Africa
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- Straits Asia Resources Limited - Singapore
- Banpu Public Company Limited - Thailand
- Commonwealth Bank - Australia
- Bharathi Cement Corporation - India
- GMR Energy Limited - India
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Edison Trading Spa - Italy
- Neyveli Lignite Corporation Ltd, - India
- Bukit Makmur.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- ICICI Bank Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Cement Manufacturers Association - India
- Therma Luzon, Inc, Philippines
- GVK Power & Infra Limited - India
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Karaikal Port Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Australian Coal Association
- AsiaOL BioFuels Corp., Philippines
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- PowerSource Philippines DevCo
- Metalloyd Limited - United Kingdom
- Global Business Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Dalmia Cement Bharat India
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- Indian Energy Exchange, India
- Timah Investasi Mineral - Indoneisa
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Siam City Cement PLC, Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Bhatia International Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Mining Services - Indonesia
- Iligan Light & Power Inc, Philippines
- Chamber of Mines of South Africa
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Cigading International Bulk Terminal - Indonesia
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- India Bulls Power Limited - India
- Mercuria Energy - Indonesia
- Merrill Lynch Commodities Europe
- Coalindo Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- San Jose City I Power Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Trasteel International SA, Italy
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- LBH Netherlands Bv - Netherlands
- Romanian Commodities Exchange
- Semirara Mining and Power Corporation, Philippines
- Bangladesh Power Developement Board
- IEA Clean Coal Centre - UK
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Attock Cement Pakistan Limited
- Posco Energy - South Korea
- Heidelberg Cement - Germany
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Eastern Energy - Thailand
- Sojitz Corporation - Japan
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Indonesian Coal Mining Association
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- CIMB Investment Bank - Malaysia
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