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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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Tuesday, 04 May 10
DRY BULK MARKET SOFTENING AGAIN ON LACK OF DIRECTION
The dry bulk market has put on the brakes once again, after the last session of the Baltic Dry Index ended at 3,354 points, down 5 from the previous ...
Monday, 03 May 10
AUSTRALIA PLANS 40 PERCENT TAX ON MINING PROFITS - THE JAKARTA POST
The Jakarta Post reported that, Australia would heavily tax the booming profits of its mining companies under a tax system overhaul proposed Sunday ...
Saturday, 01 May 10
THE PERIOD ACTIVITY WAS QUITE FIRM DURING THE WEEK - CAPT. REDDY
COALspot.com: The BDI was up by 11.32 pct which was mainly due to the firmness in capsize index which was up by 21.55 pct .
The other sectors Pan ...
Saturday, 01 May 10
EXPANDED SA COAL TERMINAL TO START OPERATIONS ON MAY 1 - MINING WEEKLY
Mining Weekly reported that, In line with expectations, the Richards Bay Coal Terminal (RBCT) had completed the R1,2-billion Phase V expansion ...
Thursday, 29 April 10
SOUTH AFRICAN ROUNDS BACK TO INDIA SUPRAS CAN ACHIEVE AROUND MID 20S
Handy
Atlantic markets remain firm. Supramaxes open in USG are now achieving low/mid&n ...
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- Kobexindo Tractors - Indoneisa
- Toyota Tsusho Corporation, Japan
- Wilmar Investment Holdings
- Sical Logistics Limited - India
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Cement Manufacturers Association - India
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- VISA Power Limited - India
- Sindya Power Generating Company Private Ltd
- Madhucon Powers Ltd - India
- Global Business Power Corporation, Philippines
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Economic Council, Georgia
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Star Paper Mills Limited - India
- Maheswari Brothers Coal Limited - India
- Sakthi Sugars Limited - India
- GMR Energy Limited - India
- Parliament of New Zealand
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Africa Commodities Group - South Africa
- Malabar Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Romanian Commodities Exchange
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Tamil Nadu electricity Board
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- SMG Consultants - Indonesia
- Semirara Mining Corp, Philippines
- Central Java Power - Indonesia
- Therma Luzon, Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vizag Seaport Private Limited - India
- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Thiess Contractors Indonesia
- Chamber of Mines of South Africa
- Coalindo Energy - Indonesia
- Meralco Power Generation, Philippines
- Makarim & Taira - Indonesia
- Dalmia Cement Bharat India
- Bangladesh Power Developement Board
- Altura Mining Limited, Indonesia
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Coastal Gujarat Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Interocean Group of Companies - India
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Energy Link Ltd, New Zealand
- Formosa Plastics Group - Taiwan
- Independent Power Producers Association of India
- Barasentosa Lestari - Indonesia
- Thai Mozambique Logistica
- Ceylon Electricity Board - Sri Lanka
- Trasteel International SA, Italy
- Eastern Energy - Thailand
- Global Green Power PLC Corporation, Philippines
- Sojitz Corporation - Japan
- Videocon Industries ltd - India
- Krishnapatnam Port Company Ltd. - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Georgia Ports Authority, United States
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- Tata Chemicals Ltd - India
- Kumho Petrochemical, South Korea
- Lanco Infratech Ltd - India
- New Zealand Coal & Carbon
- London Commodity Brokers - England
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- SMC Global Power, Philippines
- Grasim Industreis Ltd - India
- Mercuria Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- Marubeni Corporation - India
- Deloitte Consulting - India
- IEA Clean Coal Centre - UK
- Merrill Lynch Commodities Europe
- Ambuja Cements Ltd - India
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Rio Tinto Coal - Australia
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Medco Energi Mining Internasional
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- CNBM International Corporation - China
- Agrawal Coal Company - India
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- Electricity Generating Authority of Thailand
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Ministry of Finance - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- PTC India Limited - India
- Bhushan Steel Limited - India
- Salva Resources Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Metalloyd Limited - United Kingdom
- Attock Cement Pakistan Limited
- Kapuas Tunggal Persada - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sree Jayajothi Cements Limited - India
- ICICI Bank Limited - India
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Indo Tambangraya Megah - Indonesia
- Meenaskhi Energy Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Energy Development Corp, Philippines
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Leighton Contractors Pty Ltd - Australia
- MS Steel International - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Manunggal Multi Energi - Indonesia
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- India Bulls Power Limited - India
- Central Electricity Authority - India
- Parry Sugars Refinery, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- PowerSource Philippines DevCo
- AsiaOL BioFuels Corp., Philippines
- Posco Energy - South Korea
- SN Aboitiz Power Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- The Treasury - Australian Government
- Banpu Public Company Limited - Thailand
- Chettinad Cement Corporation Ltd - India
- Simpson Spence & Young - Indonesia
- White Energy Company Limited
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Eastern Coal Council - USA
- Karbindo Abesyapradhi - Indoneisa
- Larsen & Toubro Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bharathi Cement Corporation - India
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Indian Energy Exchange, India
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- The University of Queensland
- Savvy Resources Ltd - HongKong
- Australian Coal Association
- Indika Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Sarangani Energy Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bhoruka Overseas - Indonesia
- Australian Commodity Traders Exchange
- Vedanta Resources Plc - India
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