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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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Wednesday, 19 May 10
DRY BULK FREIGHT RATES' RALLY MAY BE SET TO END
The Baltic Dry Index (BDI) has rallied these past couple of weeks, almost touching the 4,000 point mark. But this positive development for dry bulk ...
Wednesday, 19 May 10
NEWCASTLE WEEKLY EXPORTS RISE; SHIP QUEUE LENGTHENS
Coal shipments from Australia's Newcastle port, the world's biggest export harbor for the fuel used in power stations, rose 2.9 percent last week ...
Tuesday, 18 May 10
THE BDI HIT A FIVE-MONTH HIGH AT THE CLOSE OF LAST WEEK
According to BRS, One of the oldest ship broker, at 3,929 points, the BDI hit a five-month high at the close of last week. The Capesize four time ch ...
Tuesday, 18 May 10
COAL TRADER CHINA QINFA TO BUY TWO BULK CARRIERS FOR 69 MLN USD
China Qinfa Group, a leading non-State-owned coal trader on China's mainland, said Sunday it had signed shipbuilding contracts to pay 69 million U. ...
Monday, 17 May 10
INDONESIA SHIPPED 15.51 PERCENT LESS COAL IN APRIL THAN A MONTH EARLIER
COALspot.com: Indonesia, the world largest coal exporter, shipped 23,331,542 MT of coal in April 2010, compare to 27.61 million tons in ...
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- Tata Chemicals Ltd - India
- Coalindo Energy - Indonesia
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Orica Australia Pty. Ltd.
- VISA Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Global Business Power Corporation, Philippines
- Australian Coal Association
- Videocon Industries ltd - India
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- Wood Mackenzie - Singapore
- Ministry of Transport, Egypt
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Cigading International Bulk Terminal - Indonesia
- Trasteel International SA, Italy
- Essar Steel Hazira Ltd - India
- Siam City Cement PLC, Thailand
- Formosa Plastics Group - Taiwan
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Thai Mozambique Logistica
- Kohat Cement Company Ltd. - Pakistan
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Kartika Selabumi Mining - Indonesia
- Carbofer General Trading SA - India
- Medco Energi Mining Internasional
- Commonwealth Bank - Australia
- Kumho Petrochemical, South Korea
- Coal and Oil Company - UAE
- Kalimantan Lumbung Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- White Energy Company Limited
- Makarim & Taira - Indonesia
- Iligan Light & Power Inc, Philippines
- Interocean Group of Companies - India
- Central Electricity Authority - India
- Heidelberg Cement - Germany
- Sindya Power Generating Company Private Ltd
- Indonesian Coal Mining Association
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Coastal Gujarat Power Limited - India
- Sakthi Sugars Limited - India
- Marubeni Corporation - India
- Aboitiz Power Corporation - Philippines
- SMC Global Power, Philippines
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Altura Mining Limited, Indonesia
- Indogreen Group - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- Australian Commodity Traders Exchange
- Ind-Barath Power Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Tamil Nadu electricity Board
- South Luzon Thermal Energy Corporation
- Malabar Cements Ltd - India
- Sical Logistics Limited - India
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- India Bulls Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Power Finance Corporation Ltd., India
- Ambuja Cements Ltd - India
- SMG Consultants - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Toyota Tsusho Corporation, Japan
- Bayan Resources Tbk. - Indonesia
- Madhucon Powers Ltd - India
- Standard Chartered Bank - UAE
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- International Coal Ventures Pvt Ltd - India
- Central Java Power - Indonesia
- ASAPP Information Group - India
- Latin American Coal - Colombia
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Salva Resources Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- Ministry of Mines - Canada
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- The University of Queensland
- Pendopo Energi Batubara - Indonesia
- Therma Luzon, Inc, Philippines
- Chamber of Mines of South Africa
- Parry Sugars Refinery, India
- Siam City Cement - Thailand
- Metalloyd Limited - United Kingdom
- McConnell Dowell - Australia
- Petron Corporation, Philippines
- London Commodity Brokers - England
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Anglo American - United Kingdom
- The State Trading Corporation of India Ltd
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- Rio Tinto Coal - Australia
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Economic Council, Georgia
- LBH Netherlands Bv - Netherlands
- Merrill Lynch Commodities Europe
- SN Aboitiz Power Inc, Philippines
- Cement Manufacturers Association - India
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Gujarat Sidhee Cement - India
- Attock Cement Pakistan Limited
- Africa Commodities Group - South Africa
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- PNOC Exploration Corporation - Philippines
- Borneo Indobara - Indonesia
- Uttam Galva Steels Limited - India
- Bharathi Cement Corporation - India
- Indian Oil Corporation Limited
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- PetroVietnam Power Coal Import and Supply Company
- Global Coal Blending Company Limited - Australia
- Minerals Council of Australia
- Directorate General of MIneral and Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Indo Tambangraya Megah - Indonesia
- GVK Power & Infra Limited - India
- Antam Resourcindo - Indonesia
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Xindia Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bangladesh Power Developement Board
- Mintek Dendrill Indonesia
- Sarangani Energy Corporation, Philippines
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Eastern Coal Council - USA
- Riau Bara Harum - Indonesia
- Karaikal Port Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Sree Jayajothi Cements Limited - India
- Mercator Lines Limited - India
- Orica Mining Services - Indonesia
- PTC India Limited - India
- Electricity Generating Authority of Thailand
- Aditya Birla Group - India
- Agrawal Coal Company - India
- OPG Power Generation Pvt Ltd - India
- Indian Energy Exchange, India
- GN Power Mariveles Coal Plant, Philippines
- CNBM International Corporation - China
- Singapore Mercantile Exchange
- Semirara Mining Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Kideco Jaya Agung - Indonesia
- San Jose City I Power Corp, Philippines
- Vizag Seaport Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Planning Commission, India
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