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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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Friday, 16 April 10
RBCT COAL DISPUTE RESOLVED - MININGMX
Miningmx reported that, the long-simmering spat over the coal allocation for producers who will use the expanded facilities at Richards Bay Coal Ter ...
Friday, 16 April 10
COAL INDIA SELECTS MERCHANT BANKERS TO ACQUIRE OVERSEAS ASSETS -THE HINDU
An investment of about $1.8 billion is expected to be made in these deals
The Hindu reported that, Bank of America-Merill Lynch, Royal Bank of Sc ...
Thursday, 15 April 10
MAJOR THERMAL COAL CONTRACT AT 40% HIGHER PRICE THAN LAST YEAR - BUSINESS STANDARD
Business-Standard reported that, India is expected to import nearly 60 million tonnes of thermal coal this year.
After coking coal and iron ...
Thursday, 15 April 10
RICHARDS BAY ROUNDS BACK TO INDIA SUPRAS WERE FIXED AT MID 20'S
Handy
The BSI remains in a positive momentum and the Atlantic remains unchanged from last week. Fronthaul grain is active which is keeping ballast ...
Thursday, 15 April 10
DRY BULK MARKET SLOWLY GAINING GROUND
The troubled and underperforming capesize sector of the dry bulk market has been experiencing an improved sentiment since Tuesday, a trend verified ...
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- Holcim Trading Pte Ltd - Singapore
- Indian Energy Exchange, India
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- The State Trading Corporation of India Ltd
- Barasentosa Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Thai Mozambique Logistica
- Antam Resourcindo - Indonesia
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Chamber of Mines of South Africa
- Indo Tambangraya Megah - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Mintek Dendrill Indonesia
- London Commodity Brokers - England
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- Orica Mining Services - Indonesia
- Bhatia International Limited - India
- Coal and Oil Company - UAE
- Neyveli Lignite Corporation Ltd, - India
- Salva Resources Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- Mercator Lines Limited - India
- Attock Cement Pakistan Limited
- Gujarat Mineral Development Corp Ltd - India
- Grasim Industreis Ltd - India
- Jaiprakash Power Ventures ltd
- Medco Energi Mining Internasional
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- Savvy Resources Ltd - HongKong
- Coalindo Energy - Indonesia
- Commonwealth Bank - Australia
- Renaissance Capital - South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Ministry of Mines - Canada
- The Treasury - Australian Government
- India Bulls Power Limited - India
- Mercuria Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Krishnapatnam Port Company Ltd. - India
- Essar Steel Hazira Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Australian Coal Association
- Sical Logistics Limited - India
- San Jose City I Power Corp, Philippines
- Ministry of Finance - Indonesia
- Gujarat Sidhee Cement - India
- Jindal Steel & Power Ltd - India
- Karaikal Port Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Sindya Power Generating Company Private Ltd
- Electricity Authority, New Zealand
- Xindia Steels Limited - India
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- GMR Energy Limited - India
- Ambuja Cements Ltd - India
- Africa Commodities Group - South Africa
- Malabar Cements Ltd - India
- Kaltim Prima Coal - Indonesia
- Latin American Coal - Colombia
- Singapore Mercantile Exchange
- Parliament of New Zealand
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- New Zealand Coal & Carbon
- Vizag Seaport Private Limited - India
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- White Energy Company Limited
- Sakthi Sugars Limited - India
- Bukit Baiduri Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- OPG Power Generation Pvt Ltd - India
- Standard Chartered Bank - UAE
- IEA Clean Coal Centre - UK
- AsiaOL BioFuels Corp., Philippines
- Sree Jayajothi Cements Limited - India
- Bharathi Cement Corporation - India
- Kobexindo Tractors - Indoneisa
- Siam City Cement - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- Carbofer General Trading SA - India
- Semirara Mining Corp, Philippines
- Georgia Ports Authority, United States
- Vedanta Resources Plc - India
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Kepco SPC Power Corporation, Philippines
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Central Java Power - Indonesia
- Kumho Petrochemical, South Korea
- Petron Corporation, Philippines
- Deloitte Consulting - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parry Sugars Refinery, India
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- McConnell Dowell - Australia
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- TNB Fuel Sdn Bhd - Malaysia
- Indogreen Group - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- European Bulk Services B.V. - Netherlands
- Power Finance Corporation Ltd., India
- Uttam Galva Steels Limited - India
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Globalindo Alam Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Posco Energy - South Korea
- MS Steel International - UAE
- Manunggal Multi Energi - Indonesia
- PTC India Limited - India
- Economic Council, Georgia
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Riau Bara Harum - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Maheswari Brothers Coal Limited - India
- International Coal Ventures Pvt Ltd - India
- Indian Oil Corporation Limited
- Electricity Generating Authority of Thailand
- Heidelberg Cement - Germany
- GN Power Mariveles Coal Plant, Philippines
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- PNOC Exploration Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Timah Investasi Mineral - Indoneisa
- SMC Global Power, Philippines
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- Coastal Gujarat Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Energy Development Corp, Philippines
- Samtan Co., Ltd - South Korea
- Central Electricity Authority - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- Therma Luzon, Inc, Philippines
- Eastern Coal Council - USA
- Rio Tinto Coal - Australia
- Banpu Public Company Limited - Thailand
- PowerSource Philippines DevCo
- Dalmia Cement Bharat India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- Eastern Energy - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Interocean Group of Companies - India
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Siam City Cement PLC, Thailand
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Altura Mining Limited, Indonesia
- Minerals Council of Australia
- Leighton Contractors Pty Ltd - Australia
- Tata Chemicals Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Edison Trading Spa - Italy
- Larsen & Toubro Limited - India
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