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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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Monday, 07 June 10
SOUTH AFRICA COAL STAYS NEAR 18-MONTH HIGH ON EUROPEAN DEMAND - BLOOMBERG
Bloomberg Reported that, Prices for coal shipped from South Africa’s Richards Bay, the continent’s biggest export facility for the fuel, ...
Sunday, 06 June 10
THE DOWNWARD TREND FOR S6 AND S7 ROUTE IS LIKELY TO CONTINUE NEXT WEEK - VISTAAR
COALspot.com: "This seemed market heading for corrections with all sectors down", said, Capt. Reddy, MD of Vistaar Shipping Singapore, an ...
Sunday, 06 June 10
STEAM COAL MAY BECOME NEXT BOOMING COMMODITY IN AUSTRALIA - DB
Deutsche Bank predicts that thermal coal could become Australia's next booming commodity. The German investment bank's global thermal coal team ex ...
Friday, 04 June 10
INDO/INDIA AROUND THE MID 20'S LEVEL AND MID TO HIGH 20'S INDIA/CHINA
Handy
After a quiet end to last week, the Atlantic handysize market continued&nb ...
Thursday, 03 June 10
INDO GOVERNMENT TRIES TO CALM BUSINESSES FEARS OVER FOREST - CLEARING MORATORIUM
The Jakarta Globe reported that, as producers of coal and palm oil continued to howl, the government on Tuesday offered reassurances that the develo ...
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- Petrochimia International Co. Ltd.- Taiwan
- OPG Power Generation Pvt Ltd - India
- MS Steel International - UAE
- Salva Resources Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Simpson Spence & Young - Indonesia
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- Wilmar Investment Holdings
- PTC India Limited - India
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- Miang Besar Coal Terminal - Indonesia
- Aditya Birla Group - India
- Lanco Infratech Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- Kideco Jaya Agung - Indonesia
- Therma Luzon, Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Maheswari Brothers Coal Limited - India
- Goldman Sachs - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Agrawal Coal Company - India
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- Sinarmas Energy and Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Pendopo Energi Batubara - Indonesia
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- Bhushan Steel Limited - India
- Jaiprakash Power Ventures ltd
- Tamil Nadu electricity Board
- Barasentosa Lestari - Indonesia
- Formosa Plastics Group - Taiwan
- Medco Energi Mining Internasional
- Thiess Contractors Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Independent Power Producers Association of India
- Meralco Power Generation, Philippines
- Anglo American - United Kingdom
- SMG Consultants - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bangladesh Power Developement Board
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
- Indo Tambangraya Megah - Indonesia
- Merrill Lynch Commodities Europe
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- IEA Clean Coal Centre - UK
- Energy Link Ltd, New Zealand
- Altura Mining Limited, Indonesia
- Orica Australia Pty. Ltd.
- PowerSource Philippines DevCo
- Ceylon Electricity Board - Sri Lanka
- Central Electricity Authority - India
- Karaikal Port Pvt Ltd - India
- Indogreen Group - Indonesia
- Planning Commission, India
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Minerals Council of Australia
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- Electricity Generating Authority of Thailand
- Bayan Resources Tbk. - Indonesia
- Coal and Oil Company - UAE
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- Baramulti Group, Indonesia
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Timah Investasi Mineral - Indoneisa
- Australian Coal Association
- Energy Development Corp, Philippines
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- Eastern Coal Council - USA
- Ind-Barath Power Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Savvy Resources Ltd - HongKong
- Georgia Ports Authority, United States
- Vizag Seaport Private Limited - India
- The State Trading Corporation of India Ltd
- Cigading International Bulk Terminal - Indonesia
- Renaissance Capital - South Africa
- Vedanta Resources Plc - India
- Kaltim Prima Coal - Indonesia
- Power Finance Corporation Ltd., India
- Bukit Baiduri Energy - Indonesia
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Madhucon Powers Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Finance - Indonesia
- Star Paper Mills Limited - India
- Alfred C Toepfer International GmbH - Germany
- Bhoruka Overseas - Indonesia
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- Ambuja Cements Ltd - India
- Mintek Dendrill Indonesia
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Trasteel International SA, Italy
- Interocean Group of Companies - India
- Karbindo Abesyapradhi - Indoneisa
- Carbofer General Trading SA - India
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- International Coal Ventures Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Siam City Cement - Thailand
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- AsiaOL BioFuels Corp., Philippines
- European Bulk Services B.V. - Netherlands
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- Leighton Contractors Pty Ltd - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Mines - Canada
- Economic Council, Georgia
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- Africa Commodities Group - South Africa
- Metalloyd Limited - United Kingdom
- Manunggal Multi Energi - Indonesia
- Indian Energy Exchange, India
- India Bulls Power Limited - India
- Videocon Industries ltd - India
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- Posco Energy - South Korea
- Deloitte Consulting - India
- The University of Queensland
- San Jose City I Power Corp, Philippines
- Riau Bara Harum - Indonesia
- Samtan Co., Ltd - South Korea
- Kobexindo Tractors - Indoneisa
- Semirara Mining Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- CIMB Investment Bank - Malaysia
- Price Waterhouse Coopers - Russia
- Kumho Petrochemical, South Korea
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- Australian Commodity Traders Exchange
- Gujarat Sidhee Cement - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tata Chemicals Ltd - India
- Indian Oil Corporation Limited
- Eastern Energy - Thailand
- Semirara Mining and Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Coalindo Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Grasim Industreis Ltd - India
- ASAPP Information Group - India
- Sojitz Corporation - Japan
- Heidelberg Cement - Germany
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Ministry of Transport, Egypt
- Gujarat Mineral Development Corp Ltd - India
- Intertek Mineral Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- VISA Power Limited - India
- Port Waratah Coal Services - Australia
- SMC Global Power, Philippines
- Oldendorff Carriers - Singapore
- PNOC Exploration Corporation - Philippines
- Uttam Galva Steels Limited - India
- Xindia Steels Limited - India
- McConnell Dowell - Australia
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- Parliament of New Zealand
- Malabar Cements Ltd - India
- Sical Logistics Limited - India
- Sindya Power Generating Company Private Ltd
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