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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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Saturday, 19 June 10
STRONG DEMAND, RISING PRODUCTION SETTING SCENE FOR COAL BONANZA - THE JAKARTA GLOBE
The Jakarta globe rerported that, As the nation’s coal miners enjoy burgeoning demand from energy-hungry economies such as China and India, th ...
Saturday, 19 June 10
DRY BULK MARKET DOWN ON CHINESE SLOWDOWN FEARS
Dry bulk freight rates have been on a freefall for more than two weeks now, something which has caused the industry’s benchmark, the Baltic Dr ...
Saturday, 19 June 10
COAL INDIA KEEN ON BLOCK DEVELOPMENT IN INDONESIA - THE HINDU BUSINESS LINE
Expanding horizon
Agreement by the Indonesian Government is likely to help CIL gain foothold in India's largest sourcing point of thermal coal.
...
Friday, 18 June 10
THE PANAMAX MARKET CONTINUED ITS SOFTENING TREND - FEARNBULK
Handy
Flat Atlantic markets with most markets in ´slow mode´ due to holidays in China.
Supramax vessels open in the USG are achievi ...
Thursday, 17 June 10
INDONESIAN COAL PRICE REFERENCE FOR JUNE IS US$ 97.22/TON UP 5.59 PERCENT
COALspot.com: The directorate general of mineral, coal and geothermal of Indonesia has been publishing a monthly coal price reference (HBA) to be us ...
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- Siam City Cement - Thailand
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Aboitiz Power Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Tamil Nadu electricity Board
- Port Waratah Coal Services - Australia
- Ministry of Finance - Indonesia
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- Parliament of New Zealand
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Lanco Infratech Ltd - India
- Bhatia International Limited - India
- Essar Steel Hazira Ltd - India
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PNOC Exploration Corporation - Philippines
- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
- Maheswari Brothers Coal Limited - India
- Sarangani Energy Corporation, Philippines
- PTC India Limited - India
- PetroVietnam Power Coal Import and Supply Company
- India Bulls Power Limited - India
- Therma Luzon, Inc, Philippines
- Parry Sugars Refinery, India
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Mintek Dendrill Indonesia
- Gujarat Sidhee Cement - India
- Bhoruka Overseas - Indonesia
- IEA Clean Coal Centre - UK
- Aditya Birla Group - India
- Trasteel International SA, Italy
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Indo Tambangraya Megah - Indonesia
- The State Trading Corporation of India Ltd
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Singapore Mercantile Exchange
- Thai Mozambique Logistica
- Baramulti Group, Indonesia
- Kumho Petrochemical, South Korea
- Riau Bara Harum - Indonesia
- South Luzon Thermal Energy Corporation
- Chamber of Mines of South Africa
- Semirara Mining and Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Deloitte Consulting - India
- Latin American Coal - Colombia
- Vizag Seaport Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Global Green Power PLC Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Ambuja Cements Ltd - India
- GMR Energy Limited - India
- Formosa Plastics Group - Taiwan
- Coastal Gujarat Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Larsen & Toubro Limited - India
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- Tata Chemicals Ltd - India
- Mercuria Energy - Indonesia
- Medco Energi Mining Internasional
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Carbofer General Trading SA - India
- Mjunction Services Limited - India
- IHS Mccloskey Coal Group - USA
- LBH Netherlands Bv - Netherlands
- Straits Asia Resources Limited - Singapore
- Indogreen Group - Indonesia
- Orica Australia Pty. Ltd.
- Xindia Steels Limited - India
- Dalmia Cement Bharat India
- Bayan Resources Tbk. - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sakthi Sugars Limited - India
- The Treasury - Australian Government
- Jindal Steel & Power Ltd - India
- Coal and Oil Company - UAE
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Altura Mining Limited, Indonesia
- Manunggal Multi Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Indonesian Coal Mining Association
- Kideco Jaya Agung - Indonesia
- SMG Consultants - Indonesia
- Star Paper Mills Limited - India
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- Edison Trading Spa - Italy
- Antam Resourcindo - Indonesia
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Bukit Asam (Persero) Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Power Finance Corporation Ltd., India
- Oldendorff Carriers - Singapore
- Energy Link Ltd, New Zealand
- Posco Energy - South Korea
- Banpu Public Company Limited - Thailand
- Meralco Power Generation, Philippines
- Economic Council, Georgia
- Wilmar Investment Holdings
- Wood Mackenzie - Singapore
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Neyveli Lignite Corporation Ltd, - India
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Uttam Galva Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Ind-Barath Power Infra Limited - India
- Ministry of Transport, Egypt
- Heidelberg Cement - Germany
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Africa Commodities Group - South Africa
- Intertek Mineral Services - Indonesia
- Chettinad Cement Corporation Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- Coalindo Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- Bangladesh Power Developement Board
- Savvy Resources Ltd - HongKong
- Directorate General of MIneral and Coal - Indonesia
- VISA Power Limited - India
- Bharathi Cement Corporation - India
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Australian Coal Association
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- Directorate Of Revenue Intelligence - India
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Authority, New Zealand
- CIMB Investment Bank - Malaysia
- Videocon Industries ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- SMC Global Power, Philippines
- ASAPP Information Group - India
- Georgia Ports Authority, United States
- ICICI Bank Limited - India
- Eastern Energy - Thailand
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Planning Commission, India
- Sical Logistics Limited - India
- Makarim & Taira - Indonesia
- Indika Energy - Indonesia
- Price Waterhouse Coopers - Russia
- AsiaOL BioFuels Corp., Philippines
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Malabar Cements Ltd - India
- New Zealand Coal & Carbon
- Agrawal Coal Company - India
- International Coal Ventures Pvt Ltd - India
- CNBM International Corporation - China
- Pendopo Energi Batubara - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Madhucon Powers Ltd - India
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- Attock Cement Pakistan Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- The University of Queensland
- Global Business Power Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- White Energy Company Limited
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