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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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Monday, 12 January 15
SHIPPING - CHALLENGES AND RESOLUTIONS - EVA TZIMA
Last year has without a doubt been another challenging one both for both our industry and our country. As Greece is currently dominated by election ...
Sunday, 11 January 15
BDI DECLINED 8% ON WEEK; BCI LOST 31%
COALspot.com: The BDI continued its decline in the first week of this year or lost 8 pct week over week. The BDI was closed at 709 points whi ...
Friday, 09 January 15
U.S. EASTERN SPOT STEAM COAL PRICES FELL IN 2014; ROSE IN WEST - EIA
U.S. Eastern spot steam coal prices declined in 2014 compared to 2013 levels because of a decline in steam coal exports.
According to U.S. Ene ...
Friday, 09 January 15
WEEKLY U.S. COAL PRODUCTION UP AN ESTIMATED 2.2% Y-O-Y
COALspot.com – United States the world's one of the largest coal producers, produced approximately 17.6 million short tons (mmst) of coal ...
Thursday, 08 January 15
INDONESIA PRESSES ON WITH HIGHER COAL ROYALTY FEE TO BOOST STATE REVENUE - JG
The Indonesian government is pressing on with its plan to raise the royalty charged to coal miners in order to increase state revenue, but the move ...
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- Mjunction Services Limited - India
- Petron Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- GVK Power & Infra Limited - India
- Minerals Council of Australia
- Bahari Cakrawala Sebuku - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Rio Tinto Coal - Australia
- CNBM International Corporation - China
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Therma Luzon, Inc, Philippines
- Aditya Birla Group - India
- Central Java Power - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- Energy Link Ltd, New Zealand
- Intertek Mineral Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Goldman Sachs - Singapore
- Bhatia International Limited - India
- Marubeni Corporation - India
- Kartika Selabumi Mining - Indonesia
- Electricity Authority, New Zealand
- Thiess Contractors Indonesia
- Indian Energy Exchange, India
- Electricity Generating Authority of Thailand
- The State Trading Corporation of India Ltd
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Maheswari Brothers Coal Limited - India
- Riau Bara Harum - Indonesia
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Eastern Energy - Thailand
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Miang Besar Coal Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Coalindo Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Toyota Tsusho Corporation, Japan
- Ceylon Electricity Board - Sri Lanka
- Barasentosa Lestari - Indonesia
- Thai Mozambique Logistica
- Coal and Oil Company - UAE
- Larsen & Toubro Limited - India
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Georgia Ports Authority, United States
- Deloitte Consulting - India
- Planning Commission, India
- Dalmia Cement Bharat India
- Sindya Power Generating Company Private Ltd
- Bukit Baiduri Energy - Indonesia
- Central Electricity Authority - India
- Wilmar Investment Holdings
- Oldendorff Carriers - Singapore
- Chamber of Mines of South Africa
- Karbindo Abesyapradhi - Indoneisa
- Iligan Light & Power Inc, Philippines
- Xindia Steels Limited - India
- Power Finance Corporation Ltd., India
- Kaltim Prima Coal - Indonesia
- Bukit Makmur.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Simpson Spence & Young - Indonesia
- Mercuria Energy - Indonesia
- Australian Coal Association
- Metalloyd Limited - United Kingdom
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Gujarat Sidhee Cement - India
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- Parliament of New Zealand
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- Australian Commodity Traders Exchange
- Essar Steel Hazira Ltd - India
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Merrill Lynch Commodities Europe
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- PNOC Exploration Corporation - Philippines
- Borneo Indobara - Indonesia
- Indonesian Coal Mining Association
- PowerSource Philippines DevCo
- Videocon Industries ltd - India
- Indo Tambangraya Megah - Indonesia
- Uttam Galva Steels Limited - India
- Tamil Nadu electricity Board
- Medco Energi Mining Internasional
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- SMG Consultants - Indonesia
- Lanco Infratech Ltd - India
- Holcim Trading Pte Ltd - Singapore
- PTC India Limited - India
- Manunggal Multi Energi - Indonesia
- Siam City Cement PLC, Thailand
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Vedanta Resources Plc - India
- Rashtriya Ispat Nigam Limited - India
- Parry Sugars Refinery, India
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Kobexindo Tractors - Indoneisa
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Sojitz Corporation - Japan
- Energy Development Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Tata Chemicals Ltd - India
- Makarim & Taira - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sarangani Energy Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- VISA Power Limited - India
- Attock Cement Pakistan Limited
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- LBH Netherlands Bv - Netherlands
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Kepco SPC Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Cement Manufacturers Association - India
- Economic Council, Georgia
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Mercator Lines Limited - India
- South Luzon Thermal Energy Corporation
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Globalindo Alam Lestari - Indonesia
- Malabar Cements Ltd - India
- Latin American Coal - Colombia
- Kumho Petrochemical, South Korea
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Finance - Indonesia
- Global Coal Blending Company Limited - Australia
- Baramulti Group, Indonesia
- Sakthi Sugars Limited - India
- Romanian Commodities Exchange
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Meralco Power Generation, Philippines
- White Energy Company Limited
- Indika Energy - Indonesia
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Port Waratah Coal Services - Australia
- Directorate General of MIneral and Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- Singapore Mercantile Exchange
- Semirara Mining and Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
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