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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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Friday, 02 July 10
PROPOSED MINERAL RESOURCE RENT TAX - PRESS RELEASE (2)
Press Release: BHP Billiton, Rio Tinto and Xstrata said today that they are encouraged by the Federal Government’s announcement that it propos ...
Friday, 02 July 10
MINERALS RESOURCE TAXATION IN AUSTRALIA - PRESS RELEASE
Press Release : Rio Tinto acknowledges the Australian Government’s announcement that the Resource Super Profits Tax (RSPT) proposal will be re ...
Thursday, 01 July 10
TATA POWER TO RAISE US$300 MILLION THROUGH ITS COAL SPVS TO FUND ADDITIONAL ACQUISITIONS AND / OR REDUCE OUTSTANDING DEBT
Stock Markets Review reported that, Tata Power, India’s largest private power player has signed an agreement to raise US$300 million in Bhira ...
Thursday, 01 July 10
HELLENIC SHIPPING NEWS POLL: THE BDI WILL STAY ABOVE 3,000 POINTS IN THE SECOND HALF OF 2010
When Hellenic Shipping News Worldwide prepared June’s poll asking readers about where do they think that the Baltic Dry Index (BDI) will range ...
Thursday, 01 July 10
PANAMAX MARKETS CONTINUE TO DROP IN ALL BASINS - FEARNLEYS
Handy
Atlantic rates continue to slide with little activity. Supras open in USG get low 30´s to Med and mid 40´s to FEast. Hmax/Supra ...
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- Eastern Energy - Thailand
- Bhoruka Overseas - Indonesia
- India Bulls Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Barasentosa Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- GMR Energy Limited - India
- ICICI Bank Limited - India
- South Luzon Thermal Energy Corporation
- CNBM International Corporation - China
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Renaissance Capital - South Africa
- Port Waratah Coal Services - Australia
- Directorate Of Revenue Intelligence - India
- Billiton Holdings Pty Ltd - Australia
- Edison Trading Spa - Italy
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- Kepco SPC Power Corporation, Philippines
- Parliament of New Zealand
- Baramulti Group, Indonesia
- TeaM Sual Corporation - Philippines
- Interocean Group of Companies - India
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Manunggal Multi Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Standard Chartered Bank - UAE
- Kapuas Tunggal Persada - Indonesia
- Wilmar Investment Holdings
- Alfred C Toepfer International GmbH - Germany
- Economic Council, Georgia
- Makarim & Taira - Indonesia
- Planning Commission, India
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- Price Waterhouse Coopers - Russia
- Sinarmas Energy and Mining - Indonesia
- Metalloyd Limited - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- McConnell Dowell - Australia
- Gujarat Mineral Development Corp Ltd - India
- Straits Asia Resources Limited - Singapore
- The Treasury - Australian Government
- Ministry of Transport, Egypt
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- Riau Bara Harum - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Meralco Power Generation, Philippines
- Indonesian Coal Mining Association
- Bukit Asam (Persero) Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Kohat Cement Company Ltd. - Pakistan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kartika Selabumi Mining - Indonesia
- Gujarat Sidhee Cement - India
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Dalmia Cement Bharat India
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Lanco Infratech Ltd - India
- Independent Power Producers Association of India
- Videocon Industries ltd - India
- Meenaskhi Energy Private Limited - India
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Commonwealth Bank - Australia
- SMC Global Power, Philippines
- New Zealand Coal & Carbon
- Indian Oil Corporation Limited
- Australian Coal Association
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Ind-Barath Power Infra Limited - India
- Orica Australia Pty. Ltd.
- Posco Energy - South Korea
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Pendopo Energi Batubara - Indonesia
- Vizag Seaport Private Limited - India
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Formosa Plastics Group - Taiwan
- Globalindo Alam Lestari - Indonesia
- Deloitte Consulting - India
- Oldendorff Carriers - Singapore
- Uttam Galva Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Samtan Co., Ltd - South Korea
- SMG Consultants - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- Bayan Resources Tbk. - Indonesia
- MS Steel International - UAE
- Global Green Power PLC Corporation, Philippines
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Coal and Oil Company - UAE
- Romanian Commodities Exchange
- Holcim Trading Pte Ltd - Singapore
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- Savvy Resources Ltd - HongKong
- Antam Resourcindo - Indonesia
- Indo Tambangraya Megah - Indonesia
- Aditya Birla Group - India
- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Binh Thuan Hamico - Vietnam
- European Bulk Services B.V. - Netherlands
- Miang Besar Coal Terminal - Indonesia
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- Timah Investasi Mineral - Indoneisa
- Bhushan Steel Limited - India
- Thiess Contractors Indonesia
- Ministry of Mines - Canada
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- Maheswari Brothers Coal Limited - India
- Indika Energy - Indonesia
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Xindia Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Star Paper Mills Limited - India
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- Marubeni Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Central Electricity Authority - India
- Kobexindo Tractors - Indoneisa
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chettinad Cement Corporation Ltd - India
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- SN Aboitiz Power Inc, Philippines
- Simpson Spence & Young - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Energy Development Corp, Philippines
- Central Java Power - Indonesia
- Banpu Public Company Limited - Thailand
- VISA Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Wood Mackenzie - Singapore
- Borneo Indobara - Indonesia
- PowerSource Philippines DevCo
- Leighton Contractors Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Sakthi Sugars Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- OPG Power Generation Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- Siam City Cement - Thailand
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Altura Mining Limited, Indonesia
- Bulk Trading Sa - Switzerland
- Bangladesh Power Developement Board
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
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