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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, 06 July 10
KEPCO, POSCO BUY AUSTRALIAN COAL MINES - CHOSUN
Chosun reported that, Electricity monopoly KEPCO and steelmaker POSCO have both bought coal mines in Australia.
KEPCO signed a 400 million Austra ...
Tuesday, 06 July 10
SHENHUA GROUPS 2013 PROFIT MAY EXCEED $15 BILLION - BUSINESS WEEK
Business Week reported that, Shenhua Group Corp., China’s biggest coal producer, expects profit to exceed 100 billion yuan ($15 billion) by 20 ...
Saturday, 03 July 10
THE FREIGHT MARKET CONTINUES TO BE UNCERTAIN - CAPT. REDDY
COALspot.com: The market continues to soften and the most affect sector was Panamax which was down by almost 20 pct and closed at 2447 points. The C ...
Friday, 02 July 10
SARDA ENERGY TO ACQUIRE COAL MINES IN INDONESIA
India Info Line reported that, Sarda Energy & Minerals Ltd has announced that the authorities in Indonesia have granted the Environment Cle ...
Friday, 02 July 10
DRY BULK MARKET ON A FREEFALL, REACHING ITS LOWEST IN 9 MONTHS
The Baltic Dry Index is off to break more negative records this week, as the dry bulk shipping industry’s main benchmark has failed to find ro ...
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- Orica Mining Services - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dalmia Cement Bharat India
- Indo Tambangraya Megah - Indonesia
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Independent Power Producers Association of India
- London Commodity Brokers - England
- Maheswari Brothers Coal Limited - India
- Indogreen Group - Indonesia
- SN Aboitiz Power Inc, Philippines
- Videocon Industries ltd - India
- Siam City Cement - Thailand
- Global Green Power PLC Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- White Energy Company Limited
- Merrill Lynch Commodities Europe
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- New Zealand Coal & Carbon
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Intertek Mineral Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Marubeni Corporation - India
- Savvy Resources Ltd - HongKong
- Goldman Sachs - Singapore
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Lanco Infratech Ltd - India
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Orica Australia Pty. Ltd.
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Indian Oil Corporation Limited
- Chamber of Mines of South Africa
- Karbindo Abesyapradhi - Indoneisa
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Power Finance Corporation Ltd., India
- Karaikal Port Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Uttam Galva Steels Limited - India
- Indika Energy - Indonesia
- Siam City Cement PLC, Thailand
- ICICI Bank Limited - India
- SMG Consultants - Indonesia
- Sojitz Corporation - Japan
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Bhatia International Limited - India
- Latin American Coal - Colombia
- VISA Power Limited - India
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- Ministry of Transport, Egypt
- Asmin Koalindo Tuhup - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Energy Link Ltd, New Zealand
- Bulk Trading Sa - Switzerland
- Makarim & Taira - Indonesia
- Oldendorff Carriers - Singapore
- Global Coal Blending Company Limited - Australia
- Vedanta Resources Plc - India
- Gujarat Electricity Regulatory Commission - India
- Mjunction Services Limited - India
- Jindal Steel & Power Ltd - India
- Kideco Jaya Agung - Indonesia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- Georgia Ports Authority, United States
- GVK Power & Infra Limited - India
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- MS Steel International - UAE
- PetroVietnam Power Coal Import and Supply Company
- Malabar Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Bangladesh Power Developement Board
- PTC India Limited - India
- Standard Chartered Bank - UAE
- Bharathi Cement Corporation - India
- South Luzon Thermal Energy Corporation
- Global Business Power Corporation, Philippines
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- McConnell Dowell - Australia
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
- Maharashtra Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Medco Energi Mining Internasional
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Interocean Group of Companies - India
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Star Paper Mills Limited - India
- Kumho Petrochemical, South Korea
- Australian Coal Association
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Indonesian Coal Mining Association
- Simpson Spence & Young - Indonesia
- Economic Council, Georgia
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Planning Commission, India
- Electricity Generating Authority of Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Africa Commodities Group - South Africa
- Central Java Power - Indonesia
- Manunggal Multi Energi - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Coal and Oil Company - UAE
- Borneo Indobara - Indonesia
- Sindya Power Generating Company Private Ltd
- Kobexindo Tractors - Indoneisa
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- IEA Clean Coal Centre - UK
- Energy Development Corp, Philippines
- PowerSource Philippines DevCo
- Gujarat Sidhee Cement - India
- Cement Manufacturers Association - India
- Bukit Makmur.PT - Indonesia
- Tata Chemicals Ltd - India
- India Bulls Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Aditya Birla Group - India
- International Coal Ventures Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Thai Mozambique Logistica
- GAC Shipping (India) Pvt Ltd
- Neyveli Lignite Corporation Ltd, - India
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Metalloyd Limited - United Kingdom
- Therma Luzon, Inc, Philippines
- San Jose City I Power Corp, Philippines
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- Semirara Mining and Power Corporation, Philippines
- Petron Corporation, Philippines
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- Grasim Industreis Ltd - India
- The University of Queensland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Alfred C Toepfer International GmbH - Germany
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Finance - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Larsen & Toubro Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- SMC Global Power, Philippines
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- Kapuas Tunggal Persada - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Australian Commodity Traders Exchange
- Thiess Contractors Indonesia
- Meenaskhi Energy Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- LBH Netherlands Bv - Netherlands
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- ASAPP Information Group - India
- Romanian Commodities Exchange
- Wood Mackenzie - Singapore
- Commonwealth Bank - Australia
- Agrawal Coal Company - India
- Ambuja Cements Ltd - India
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