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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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Thursday, 10 June 10
R-POWER, INDONESIA'S SUGICO INK PACT TO ACQUIRE COAL MINES - ECONOMIC TIMES
Economic Times of India reported that, Anil Ambani-owned Reliance Power has signed a share-sale agreement with Indonesia’s Sugico Group to acq ...
Thursday, 10 June 10
PARAMOUNT MINING CORPORATION REPORTS KEY INDONESIAN JV AGREEMENT
Indonesia focussed Paramount Mining Corporation has reported that its Indonesian subsidiary, PT Paramindo, has concluded a Joint Venture Agreem ...
Wednesday, 09 June 10
INDIA, CHINA TO PROP UP THERMAL COAL DEMAND - COMMODITY ONLINE
Commodity Online : Weakness in thermal coal demand in OECD will continue to be offset by growth in demand in India and China. Therefore, the s ...
Tuesday, 08 June 10
TATA POWER LOOKING TO PICK UP STAKE IN OVERSEAS COAL MINES - ECONOMIC TIMES
Economic Times reported that, Tata Power is looking for a strategic stake purchase in coal mines of Indonesia or South Africa to fuel its upcoming 1 ...
Tuesday, 08 June 10
RUSSIA REPORTED A TENFOLD GROWTH IN COAL EXPORTS TO CHINA IN 1Q 2010 - BRS
A retreat for all the dry bulk segments this week, but especially for the Panamax and Supramax markets. The Panamax 4TC remains over US$30,000/day h ...
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- Kepco SPC Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Georgia Ports Authority, United States
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- Indian Energy Exchange, India
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Attock Cement Pakistan Limited
- White Energy Company Limited
- Wilmar Investment Holdings
- Aboitiz Power Corporation - Philippines
- Bharathi Cement Corporation - India
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Rio Tinto Coal - Australia
- Alfred C Toepfer International GmbH - Germany
- Goldman Sachs - Singapore
- Larsen & Toubro Limited - India
- Petron Corporation, Philippines
- London Commodity Brokers - England
- Bhoruka Overseas - Indonesia
- Deloitte Consulting - India
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Trasteel International SA, Italy
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- International Coal Ventures Pvt Ltd - India
- SMC Global Power, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Eastern Energy - Thailand
- Kideco Jaya Agung - Indonesia
- Binh Thuan Hamico - Vietnam
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Simpson Spence & Young - Indonesia
- Pendopo Energi Batubara - Indonesia
- PNOC Exploration Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Posco Energy - South Korea
- Edison Trading Spa - Italy
- PowerSource Philippines DevCo
- Parliament of New Zealand
- Parry Sugars Refinery, India
- Energy Link Ltd, New Zealand
- Heidelberg Cement - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Indian Oil Corporation Limited
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Global Green Power PLC Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- Karaikal Port Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Banpu Public Company Limited - Thailand
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- PetroVietnam Power Coal Import and Supply Company
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- India Bulls Power Limited - India
- GVK Power & Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- Latin American Coal - Colombia
- Petrochimia International Co. Ltd.- Taiwan
- Chettinad Cement Corporation Ltd - India
- Xindia Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Port Waratah Coal Services - Australia
- Bhatia International Limited - India
- VISA Power Limited - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Altura Mining Limited, Indonesia
- Commonwealth Bank - Australia
- Kaltim Prima Coal - Indonesia
- McConnell Dowell - Australia
- Agrawal Coal Company - India
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Planning Commission, India
- San Jose City I Power Corp, Philippines
- Vizag Seaport Private Limited - India
- Uttam Galva Steels Limited - India
- Meralco Power Generation, Philippines
- Interocean Group of Companies - India
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Economic Council, Georgia
- South Luzon Thermal Energy Corporation
- Ministry of Finance - Indonesia
- Cement Manufacturers Association - India
- Singapore Mercantile Exchange
- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- Indo Tambangraya Megah - Indonesia
- Merrill Lynch Commodities Europe
- GMR Energy Limited - India
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- Price Waterhouse Coopers - Russia
- LBH Netherlands Bv - Netherlands
- Sakthi Sugars Limited - India
- Savvy Resources Ltd - HongKong
- Wood Mackenzie - Singapore
- Sinarmas Energy and Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Independent Power Producers Association of India
- Indonesian Coal Mining Association
- Sree Jayajothi Cements Limited - India
- Electricity Authority, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- Mjunction Services Limited - India
- Mercator Lines Limited - India
- Ind-Barath Power Infra Limited - India
- Directorate General of MIneral and Coal - Indonesia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- Marubeni Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Coalindo Energy - Indonesia
- Sical Logistics Limited - India
- Jaiprakash Power Ventures ltd
- Therma Luzon, Inc, Philippines
- Aditya Birla Group - India
- Manunggal Multi Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- The Treasury - Australian Government
- Australian Commodity Traders Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining and Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Thiess Contractors Indonesia
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Eastern Coal Council - USA
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Australian Coal Association
- TeaM Sual Corporation - Philippines
- ASAPP Information Group - India
- Sarangani Energy Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Electricity Generating Authority of Thailand
- Dalmia Cement Bharat India
- Minerals Council of Australia
- Grasim Industreis Ltd - India
- Indika Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Barasentosa Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Oldendorff Carriers - Singapore
- Indogreen Group - Indonesia
- Tamil Nadu electricity Board
- Kohat Cement Company Ltd. - Pakistan
- Kapuas Tunggal Persada - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bahari Cakrawala Sebuku - Indonesia
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
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