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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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Sunday, 07 September 14
FREIGHT MARKET CONTINUED TO BE FIRM IN SPITE OF CAPE'S THIS WEEK'S WEAK PERFORMANCE
COALspot.com: BDI up by 0.7 pct week on week and closed at 1155 points this week. The Baltic Dry Index is a composite of three sub-indexes that mea ...
Sunday, 07 September 14
SHIPMANAGERS SUPERVISION CONTRACT FOR NEWBUILDS - BIMCO
Shipmanagers are frequently called upon by their owner clients to supervise newbuilding projects on their behalf. The scope of the manager’s ...
Saturday, 06 September 14
SLOW COAL EXPORT REGISTRATION RAISES CONCERNS - THE JAKARTA POST
Several coal mining companies have yet to receive the go-ahead from the Energy and Mineral Resources Ministry to obtain exporting licenses, leading ...
Saturday, 06 September 14
DRY BULK MARKET'S PROSPECTS ARE IMPROVING, DESPITE WEAK SECOND QUARTER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has been rebounding during the past month, with the Baltic Dry Index (BDI) ended the week on a high note, reaching 1,155 points ...
Saturday, 06 September 14
INDONESIA WANTS TO REGULATE COAL DEALS - THE TELEGRAPH INDIA
Indonesia has raised concerns about suspected coal deals struck between overseas buyers and its unregistered domestic miners, the telegraph India r ...
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Marubeni Corporation - India
- Salva Resources Pvt Ltd - India
- Indogreen Group - Indonesia
- Bhushan Steel Limited - India
- Antam Resourcindo - Indonesia
- Aditya Birla Group - India
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Central Electricity Authority - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Alfred C Toepfer International GmbH - Germany
- Wilmar Investment Holdings
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Eastern Energy - Thailand
- Electricity Generating Authority of Thailand
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Meralco Power Generation, Philippines
- Mercator Lines Limited - India
- Oldendorff Carriers - Singapore
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Merrill Lynch Commodities Europe
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- Malabar Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Siam City Cement - Thailand
- CNBM International Corporation - China
- Dalmia Cement Bharat India
- ASAPP Information Group - India
- Deloitte Consulting - India
- Petrochimia International Co. Ltd.- Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- GMR Energy Limited - India
- Bulk Trading Sa - Switzerland
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Agrawal Coal Company - India
- Sarangani Energy Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Coalindo Energy - Indonesia
- Rio Tinto Coal - Australia
- Edison Trading Spa - Italy
- Singapore Mercantile Exchange
- Planning Commission, India
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- Medco Energi Mining Internasional
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Tamil Nadu electricity Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Eastern Coal Council - USA
- Latin American Coal - Colombia
- MS Steel International - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Parry Sugars Refinery, India
- Xindia Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- VISA Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- Vedanta Resources Plc - India
- Riau Bara Harum - Indonesia
- SMC Global Power, Philippines
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- Larsen & Toubro Limited - India
- Therma Luzon, Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- London Commodity Brokers - England
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- IEA Clean Coal Centre - UK
- Sree Jayajothi Cements Limited - India
- New Zealand Coal & Carbon
- Price Waterhouse Coopers - Russia
- Semirara Mining and Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Formosa Plastics Group - Taiwan
- Savvy Resources Ltd - HongKong
- Orica Australia Pty. Ltd.
- Binh Thuan Hamico - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Videocon Industries ltd - India
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Global Coal Blending Company Limited - Australia
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Kepco SPC Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Bharathi Cement Corporation - India
- PowerSource Philippines DevCo
- Standard Chartered Bank - UAE
- Global Business Power Corporation, Philippines
- Renaissance Capital - South Africa
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- Sical Logistics Limited - India
- Mintek Dendrill Indonesia
- Orica Mining Services - Indonesia
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- Posco Energy - South Korea
- Ambuja Cements Ltd - India
- Heidelberg Cement - Germany
- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- Energy Link Ltd, New Zealand
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Carbofer General Trading SA - India
- Globalindo Alam Lestari - Indonesia
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Samtan Co., Ltd - South Korea
- Toyota Tsusho Corporation, Japan
- Borneo Indobara - Indonesia
- Thiess Contractors Indonesia
- McConnell Dowell - Australia
- Grasim Industreis Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- GVK Power & Infra Limited - India
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Sojitz Corporation - Japan
- PTC India Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- The State Trading Corporation of India Ltd
- Manunggal Multi Energi - Indonesia
- Mjunction Services Limited - India
- SN Aboitiz Power Inc, Philippines
- Indika Energy - Indonesia
- Siam City Cement PLC, Thailand
- Asmin Koalindo Tuhup - Indonesia
- India Bulls Power Limited - India
- Lanco Infratech Ltd - India
- Banpu Public Company Limited - Thailand
- Madhucon Powers Ltd - India
- CIMB Investment Bank - Malaysia
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Sinarmas Energy and Mining - Indonesia
- Chamber of Mines of South Africa
- Directorate Of Revenue Intelligence - India
- Metalloyd Limited - United Kingdom
- Kartika Selabumi Mining - Indonesia
- Iligan Light & Power Inc, Philippines
- European Bulk Services B.V. - Netherlands
- Meenaskhi Energy Private Limited - India
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Coastal Gujarat Power Limited - India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
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