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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, 09 July 15
CPP MARKET : POSITIVE IN THE SHORT TERM - GEORGE VASTARDIS
Despite the traditionally quieter summer period, the clean tanker market has so far experienced healthy activity especially East of Suez. Increased ...
Thursday, 09 July 15
LACK OF FRESH BUSINESS IN THE PACIFIC LEFT CAPESIZE RATES MOVING SIDEWAYS - INTERMODAL
COALspot.com: Intermodal ship broker says in its weekly report that, a different picture from what we saw the previous week was painted during the ...
Wednesday, 08 July 15
RIO TINTO'S MODERNISED KITIMAT SMELTER BEGINS PRODUCTION; KITIMAT BECOMING ONE OF THE LOWEST COST SMELTERS IN THE WORLD
COALspot.com: Rio Tinto is preparing its first shipments of metal from its world-class Kitimat aluminium smelter in Canada following an extensive m ...
Wednesday, 08 July 15
Q3'15 INDONESIA COAL SWAP DECLINED 3.14% MONTH OVER MONTH
COALspot.com: Indonesian coal swap for delivery Q3 2015 declined month on month and week over week, this past week.
The Q3 swap was declined $ ...
Tuesday, 07 July 15
FOB RICHARDS BAY COAL SWAPS DECLINED WEEK OVER WEEK
COALspot.com: API4 FOB Richards Bay Coal swap for delivery Q3' 2015 declined month over month and week over week.
The Q3 swap was down US$ ...
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- Global Green Power PLC Corporation, Philippines
- Australian Coal Association
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- South Luzon Thermal Energy Corporation
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- Truba Alam Manunggal Engineering.Tbk - Indonesia
- TeaM Sual Corporation - Philippines
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- GAC Shipping (India) Pvt Ltd
- Petron Corporation, Philippines
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- Bank of Tokyo Mitsubishi UFJ Ltd
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- Rashtriya Ispat Nigam Limited - India
- Ceylon Electricity Board - Sri Lanka
- Rio Tinto Coal - Australia
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- Medco Energi Mining Internasional
- LBH Netherlands Bv - Netherlands
- Xindia Steels Limited - India
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- TNB Fuel Sdn Bhd - Malaysia
- Metalloyd Limited - United Kingdom
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- Energy Link Ltd, New Zealand
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- Interocean Group of Companies - India
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- Global Business Power Corporation, Philippines
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- Sical Logistics Limited - India
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- Dalmia Cement Bharat India
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- Directorate General of MIneral and Coal - Indonesia
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- Oldendorff Carriers - Singapore
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- Antam Resourcindo - Indonesia
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- IEA Clean Coal Centre - UK
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- ICICI Bank Limited - India
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- Tata Chemicals Ltd - India
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- Global Coal Blending Company Limited - Australia
- Latin American Coal - Colombia
- Power Finance Corporation Ltd., India
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- Australian Commodity Traders Exchange
- Electricity Generating Authority of Thailand
- Trasteel International SA, Italy
- Bayan Resources Tbk. - Indonesia
- Coastal Gujarat Power Limited - India
- Coal and Oil Company - UAE
- Banpu Public Company Limited - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Renaissance Capital - South Africa
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Carbofer General Trading SA - India
- SMC Global Power, Philippines
- Miang Besar Coal Terminal - Indonesia
- Goldman Sachs - Singapore
- Borneo Indobara - Indonesia
- European Bulk Services B.V. - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Sidhee Cement - India
- Grasim Industreis Ltd - India
- Savvy Resources Ltd - HongKong
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- Simpson Spence & Young - Indonesia
- Formosa Plastics Group - Taiwan
- Sindya Power Generating Company Private Ltd
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Binh Thuan Hamico - Vietnam
- Intertek Mineral Services - Indonesia
- Aditya Birla Group - India
- White Energy Company Limited
- Videocon Industries ltd - India
- McConnell Dowell - Australia
- Kartika Selabumi Mining - Indonesia
- Essar Steel Hazira Ltd - India
- Larsen & Toubro Limited - India
- Lanco Infratech Ltd - India
- Independent Power Producers Association of India
- MS Steel International - UAE
- Edison Trading Spa - Italy
- International Coal Ventures Pvt Ltd - India
- Mintek Dendrill Indonesia
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Meenaskhi Energy Private Limited - India
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Wilmar Investment Holdings
- Semirara Mining Corp, Philippines
- The University of Queensland
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Semirara Mining and Power Corporation, Philippines
- Chamber of Mines of South Africa
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- Minerals Council of Australia
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- Kaltim Prima Coal - Indonesia
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- Indo Tambangraya Megah - Indonesia
- Indian Energy Exchange, India
- Therma Luzon, Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- OPG Power Generation Pvt Ltd - India
- SMG Consultants - Indonesia
- PTC India Limited - India
- Bhoruka Overseas - Indonesia
- Samtan Co., Ltd - South Korea
- Alfred C Toepfer International GmbH - Germany
- Ministry of Mines - Canada
- Makarim & Taira - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Siam City Cement PLC, Thailand
- Eastern Energy - Thailand
- Siam City Cement - Thailand
- Karaikal Port Pvt Ltd - India
- Eastern Coal Council - USA
- Bukit Asam (Persero) Tbk - Indonesia
- Indonesian Coal Mining Association
- IHS Mccloskey Coal Group - USA
- Sakthi Sugars Limited - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Chettinad Cement Corporation Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Planning Commission, India
- Deloitte Consulting - India
- Bharathi Cement Corporation - India
- Holcim Trading Pte Ltd - Singapore
- Price Waterhouse Coopers - Russia
- Tamil Nadu electricity Board
- Thai Mozambique Logistica
- CNBM International Corporation - China
- GVK Power & Infra Limited - India
- Parry Sugars Refinery, India
- Bulk Trading Sa - Switzerland
- VISA Power Limited - India
- Merrill Lynch Commodities Europe
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Asmin Koalindo Tuhup - Indonesia
- GMR Energy Limited - India
- Singapore Mercantile Exchange
- Gujarat Mineral Development Corp Ltd - India
- London Commodity Brokers - England
- Directorate Of Revenue Intelligence - India
- Toyota Tsusho Corporation, Japan
- Commonwealth Bank - Australia
- Kapuas Tunggal Persada - Indonesia
- Bangladesh Power Developement Board
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- Economic Council, Georgia
- Electricity Authority, New Zealand
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- Timah Investasi Mineral - Indoneisa
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