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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, 06 August 14
CAPES: BUSINESS INTEREST REMAINS SOFT; CURRENTLY NO SIGNS OF IMPROVEMENT - INTERMODAL
COALspot.com: Despite the considerable pressure witnessed in the freight market for most of the size segments, the Dry Bulk Index was able to note ...
Wednesday, 06 August 14
SHIPPING MARKET INSIGHT - EVA TZIMA
Recent reports that Indonesia’s ban on exports of metal ore concentrates was lifted for the first time in six months for two of its biggest m ...
Wednesday, 06 August 14
SGX SUCCESSFULLY LAUNCHED NEW SGX COAL PRODUCTS
COALspot.com: Singapore Exchange (‘SGX’) has announced that, the exchange has successfully launched its new Coking and Thermal Coal pro ...
Monday, 04 August 14
ANNUAL SECOND HALF SURGE IN BRAZILIAN IRON ORE EXPORTS ABOUT TO BEGIN - JEFFREY LANDSBERG
COALspot.com: Great strength in the capesize market has all along been set to occur during the second half of this year, as that is when Brazilian ...
Monday, 04 August 14
SUB-BIT FOB INDONESIA COAL SWAP INCHES UP DESPITE LOW DEMAND
COALspot.com: Indonesian coal swaps for average Q4’ 2014 increased US$ 0.15 day on day and US$ 0.13 per mt week on week. But, the swap was lo ...
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- Mercuria Energy - Indonesia
- Edison Trading Spa - Italy
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Sree Jayajothi Cements Limited - India
- Makarim & Taira - Indonesia
- MS Steel International - UAE
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- Meenaskhi Energy Private Limited - India
- Eastern Coal Council - USA
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- SMC Global Power, Philippines
- Gujarat Sidhee Cement - India
- Bukit Makmur.PT - Indonesia
- Central Java Power - Indonesia
- Grasim Industreis Ltd - India
- White Energy Company Limited
- Simpson Spence & Young - Indonesia
- Carbofer General Trading SA - India
- Oldendorff Carriers - Singapore
- Mercator Lines Limited - India
- Kalimantan Lumbung Energi - Indonesia
- PTC India Limited - India
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Star Paper Mills Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Sojitz Corporation - Japan
- Baramulti Group, Indonesia
- Power Finance Corporation Ltd., India
- Essar Steel Hazira Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Indian Oil Corporation Limited
- Cigading International Bulk Terminal - Indonesia
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- TeaM Sual Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Formosa Plastics Group - Taiwan
- Georgia Ports Authority, United States
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- Siam City Cement - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Green Power PLC Corporation, Philippines
- Bhushan Steel Limited - India
- Minerals Council of Australia
- Jaiprakash Power Ventures ltd
- Heidelberg Cement - Germany
- Anglo American - United Kingdom
- Madhucon Powers Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Coalindo Energy - Indonesia
- Rio Tinto Coal - Australia
- Karbindo Abesyapradhi - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Sarangani Energy Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- McConnell Dowell - Australia
- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PowerSource Philippines DevCo
- Semirara Mining Corp, Philippines
- The University of Queensland
- CNBM International Corporation - China
- Global Business Power Corporation, Philippines
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- Orica Mining Services - Indonesia
- Parry Sugars Refinery, India
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Posco Energy - South Korea
- Riau Bara Harum - Indonesia
- Attock Cement Pakistan Limited
- Petrochimia International Co. Ltd.- Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- Banpu Public Company Limited - Thailand
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Siam City Cement PLC, Thailand
- Bulk Trading Sa - Switzerland
- Kumho Petrochemical, South Korea
- Directorate Of Revenue Intelligence - India
- Tata Chemicals Ltd - India
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- International Coal Ventures Pvt Ltd - India
- Medco Energi Mining Internasional
- Ministry of Transport, Egypt
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- San Jose City I Power Corp, Philippines
- Price Waterhouse Coopers - Russia
- Uttam Galva Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- PNOC Exploration Corporation - Philippines
- Lanco Infratech Ltd - India
- Agrawal Coal Company - India
- Vijayanagar Sugar Pvt Ltd - India
- Australian Coal Association
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Africa Commodities Group - South Africa
- Malabar Cements Ltd - India
- Vizag Seaport Private Limited - India
- Trasteel International SA, Italy
- Indo Tambangraya Megah - Indonesia
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Videocon Industries ltd - India
- ASAPP Information Group - India
- Kepco SPC Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Savvy Resources Ltd - HongKong
- Holcim Trading Pte Ltd - Singapore
- Chettinad Cement Corporation Ltd - India
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- India Bulls Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMG Consultants - Indonesia
- Kobexindo Tractors - Indoneisa
- VISA Power Limited - India
- Petron Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Larsen & Toubro Limited - India
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Indika Energy - Indonesia
- Tamil Nadu electricity Board
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- The State Trading Corporation of India Ltd
- Borneo Indobara - Indonesia
- Meralco Power Generation, Philippines
- Electricity Generating Authority of Thailand
- Eastern Energy - Thailand
- Timah Investasi Mineral - Indoneisa
- Economic Council, Georgia
- Jorong Barutama Greston.PT - Indonesia
- Marubeni Corporation - India
- Interocean Group of Companies - India
- Billiton Holdings Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- IHS Mccloskey Coal Group - USA
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- Vedanta Resources Plc - India
- Xindia Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Gujarat Mineral Development Corp Ltd - India
- Aditya Birla Group - India
- GMR Energy Limited - India
- ICICI Bank Limited - India
- Ministry of Finance - Indonesia
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- Bhoruka Overseas - Indonesia
- Energy Link Ltd, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- Wilmar Investment Holdings
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- Ministry of Mines - Canada
- Standard Chartered Bank - UAE
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