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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, 08 May 15
COAL PRODUCTION IN U.S. UP 3.2% THIS PAST WEEK - EIA
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 17.4 million short ...
Wednesday, 06 May 15
COMBINATION OF HOLIDAYS AND A SHAKY MARKET PUT ADDITIONAL PRESSURE ON RATES
COALspot.com: The combination of holidays and a shaky market is always a recipe for additional pressure on rates and last week was no exception. Wi ...
Wednesday, 06 May 15
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
The first four months of 2015 are now behind us and they make up for a decent amount of time to look back and assess how the year is evolving so fa ...
Tuesday, 05 May 15
MIFA BERSAUDARA UNIT OF ABM INVESTAMA STARTS OPERATING $200M COAL MINE IN ACEH
Reswara Minergi Hartama, a coal mining unit of coal miner ABM Investama known as known as Reswara, inaugurated a $200 million integrated coal minin ...
Tuesday, 05 May 15
FREIGHT DERIVATIVE VOLUMES REACHED TOTALED 14,154 CONTRACTS IN APRIL - SGX
COALspot.com: “Our unique suite of freight and bulk commodity products provides market participants with a wide range of trading strategies a ...
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- OPG Power Generation Pvt Ltd - India
- Tata Chemicals Ltd - India
- Planning Commission, India
- Central Electricity Authority - India
- Videocon Industries ltd - India
- Edison Trading Spa - Italy
- Indian Energy Exchange, India
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Africa Commodities Group - South Africa
- Metalloyd Limited - United Kingdom
- Singapore Mercantile Exchange
- Ministry of Mines - Canada
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Energy Development Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Mjunction Services Limited - India
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- Cigading International Bulk Terminal - Indonesia
- The University of Queensland
- Bharathi Cement Corporation - India
- Directorate General of MIneral and Coal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- Siam City Cement - Thailand
- Marubeni Corporation - India
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- New Zealand Coal & Carbon
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- Electricity Authority, New Zealand
- Uttam Galva Steels Limited - India
- Bulk Trading Sa - Switzerland
- Jindal Steel & Power Ltd - India
- Jaiprakash Power Ventures ltd
- Trasteel International SA, Italy
- Orica Australia Pty. Ltd.
- Indo Tambangraya Megah - Indonesia
- Tamil Nadu electricity Board
- Eastern Energy - Thailand
- Bangladesh Power Developement Board
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Gujarat Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- Cement Manufacturers Association - India
- Thai Mozambique Logistica
- TeaM Sual Corporation - Philippines
- Central Java Power - Indonesia
- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- Asmin Koalindo Tuhup - Indonesia
- Sojitz Corporation - Japan
- Rashtriya Ispat Nigam Limited - India
- Sindya Power Generating Company Private Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Bayan Resources Tbk. - Indonesia
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- Indian Oil Corporation Limited
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- Dalmia Cement Bharat India
- Merrill Lynch Commodities Europe
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Port Waratah Coal Services - Australia
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- Malabar Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Power Finance Corporation Ltd., India
- European Bulk Services B.V. - Netherlands
- The Treasury - Australian Government
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Chettinad Cement Corporation Ltd - India
- Samtan Co., Ltd - South Korea
- Coal and Oil Company - UAE
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- CNBM International Corporation - China
- Mercuria Energy - Indonesia
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Petron Corporation, Philippines
- Grasim Industreis Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- India Bulls Power Limited - India
- Interocean Group of Companies - India
- Ministry of Transport, Egypt
- Bhatia International Limited - India
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Australian Coal Association
- Wilmar Investment Holdings
- Price Waterhouse Coopers - Russia
- Standard Chartered Bank - UAE
- Thiess Contractors Indonesia
- Pendopo Energi Batubara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- Bhushan Steel Limited - India
- Intertek Mineral Services - Indonesia
- Xindia Steels Limited - India
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kumho Petrochemical, South Korea
- Ambuja Cements Ltd - India
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Orica Mining Services - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Latin American Coal - Colombia
- Barasentosa Lestari - Indonesia
- Romanian Commodities Exchange
- Antam Resourcindo - Indonesia
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- International Coal Ventures Pvt Ltd - India
- Deloitte Consulting - India
- PTC India Limited - India
- Aditya Birla Group - India
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- Eastern Coal Council - USA
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Sarangani Energy Corporation, Philippines
- Larsen & Toubro Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- SN Aboitiz Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- Altura Mining Limited, Indonesia
- Kaltim Prima Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Indika Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Baramulti Group, Indonesia
- VISA Power Limited - India
- Directorate Of Revenue Intelligence - India
- Parliament of New Zealand
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Semirara Mining Corp, Philippines
- Parry Sugars Refinery, India
- Chamber of Mines of South Africa
- Formosa Plastics Group - Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Makarim & Taira - Indonesia
- Star Paper Mills Limited - India
- Mintek Dendrill Indonesia
- Holcim Trading Pte Ltd - Singapore
- Iligan Light & Power Inc, Philippines
- Oldendorff Carriers - Singapore
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- Global Coal Blending Company Limited - Australia
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- London Commodity Brokers - England
- Agrawal Coal Company - India
- Coastal Gujarat Power Limited - India
- Goldman Sachs - Singapore
- Posco Energy - South Korea
- Economic Council, Georgia
- Carbofer General Trading SA - India
- GMR Energy Limited - India
- ICICI Bank Limited - India
- Ministry of Finance - Indonesia
- Coalindo Energy - Indonesia
- Therma Luzon, Inc, Philippines
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