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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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Wednesday, 22 October 14
CAPESIZE MARKET REMAINED UNDER PRESSURE
COALspot.com: The Dry Bulk market closed on the red for yet another week although following Friday sentiment has started to improve on the back of ...
Tuesday, 21 October 14
INDIA'S DIESEL DEREGULATION POSITIVE FOR OIL COMPANIES - FITCH
The Indian government's 18 October decision to deregulate diesel prices will have a positive effect on the national oil marketing companies tha ...
Tuesday, 21 October 14
LOW DEMAND PUTTING COAL SWAPS UNDER PRESSURE
COALspot.com: Indonesian coal swaps for delivery Q4' 2014 lost on day, week and month.
The swap has lost US$ 1.57 (-3.04%) month on month ...
Monday, 20 October 14
CHINA'S ENVIRONMENTAL POLICIES DO NOT SPELL THE END FOR COAL - WOOD MACKENZIE
China's environmental policies do not spell the end for coal Analysis across energy commodities show coal still accounting for 64% of power mix ...
Monday, 20 October 14
CFR SOUTH CHINA COAL SWAPS FAILED TO PERFORM POSITIVE
COALspot.com: API 8 CFR South China Coal swap for Q4’ 2014 delivery decreased US$ 3.04 (-4.57%) month over month and US$ 1.75 (-2.68%) week o ...
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- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- Globalindo Alam Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- Maheswari Brothers Coal Limited - India
- Central Electricity Authority - India
- Ind-Barath Power Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Chamber of Mines of South Africa
- PetroVietnam Power Coal Import and Supply Company
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- TNB Fuel Sdn Bhd - Malaysia
- Wood Mackenzie - Singapore
- Bhoruka Overseas - Indonesia
- Simpson Spence & Young - Indonesia
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Karbindo Abesyapradhi - Indoneisa
- Deloitte Consulting - India
- CNBM International Corporation - China
- Bhushan Steel Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vedanta Resources Plc - India
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- India Bulls Power Limited - India
- Global Business Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ICICI Bank Limited - India
- Iligan Light & Power Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- Bharathi Cement Corporation - India
- Energy Development Corp, Philippines
- Rio Tinto Coal - Australia
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- Banpu Public Company Limited - Thailand
- Vizag Seaport Private Limited - India
- Thai Mozambique Logistica
- Kapuas Tunggal Persada - Indonesia
- MS Steel International - UAE
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sinarmas Energy and Mining - Indonesia
- Anglo American - United Kingdom
- Attock Cement Pakistan Limited
- Energy Link Ltd, New Zealand
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- Kumho Petrochemical, South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Semirara Mining and Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- The University of Queensland
- Parry Sugars Refinery, India
- Minerals Council of Australia
- Medco Energi Mining Internasional
- Latin American Coal - Colombia
- Goldman Sachs - Singapore
- Binh Thuan Hamico - Vietnam
- Port Waratah Coal Services - Australia
- Bangladesh Power Developement Board
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Economic Council, Georgia
- Karaikal Port Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- Offshore Bulk Terminal Pte Ltd, Singapore
- Videocon Industries ltd - India
- Barasentosa Lestari - Indonesia
- Indogreen Group - Indonesia
- PowerSource Philippines DevCo
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- Tata Chemicals Ltd - India
- Petron Corporation, Philippines
- Sical Logistics Limited - India
- Coal and Oil Company - UAE
- Therma Luzon, Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Cement Manufacturers Association - India
- PTC India Limited - India
- Aboitiz Power Corporation - Philippines
- Sojitz Corporation - Japan
- New Zealand Coal & Carbon
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- South Luzon Thermal Energy Corporation
- GMR Energy Limited - India
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- Romanian Commodities Exchange
- Madhucon Powers Ltd - India
- Trasteel International SA, Italy
- Directorate General of MIneral and Coal - Indonesia
- Mjunction Services Limited - India
- Aditya Birla Group - India
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- IHS Mccloskey Coal Group - USA
- Borneo Indobara - Indonesia
- Kobexindo Tractors - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Manunggal Multi Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- The State Trading Corporation of India Ltd
- Thiess Contractors Indonesia
- Meralco Power Generation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Dalmia Cement Bharat India
- Georgia Ports Authority, United States
- Orica Australia Pty. Ltd.
- Larsen & Toubro Limited - India
- Uttam Galva Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- San Jose City I Power Corp, Philippines
- Independent Power Producers Association of India
- Cigading International Bulk Terminal - Indonesia
- Grasim Industreis Ltd - India
- Bhatia International Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- Miang Besar Coal Terminal - Indonesia
- SMC Global Power, Philippines
- Intertek Mineral Services - Indonesia
- Makarim & Taira - Indonesia
- ASAPP Information Group - India
- Renaissance Capital - South Africa
- Ministry of Mines - Canada
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Rashtriya Ispat Nigam Limited - India
- Wilmar Investment Holdings
- Malabar Cements Ltd - India
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- Standard Chartered Bank - UAE
- Singapore Mercantile Exchange
- Sree Jayajothi Cements Limited - India
- Sarangani Energy Corporation, Philippines
- Power Finance Corporation Ltd., India
- Global Coal Blending Company Limited - Australia
- Eastern Coal Council - USA
- Orica Mining Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- Kideco Jaya Agung - Indonesia
- Electricity Generating Authority of Thailand
- Essar Steel Hazira Ltd - India
- CIMB Investment Bank - Malaysia
- Price Waterhouse Coopers - Russia
- VISA Power Limited - India
- Savvy Resources Ltd - HongKong
- Central Java Power - Indonesia
- The Treasury - Australian Government
- SMG Consultants - Indonesia
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- PNOC Exploration Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
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