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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, 16 July 14
INDIA BUDGET HAS LIMITED SHORT TERM IMPACT ON POWER SECTOR - FITCH RATINGS
Fitch Ratings says that the measures announced relating to India's electricity sector in the budget for FY2015 are directionally correct but in ...
Wednesday, 16 July 14
WEEKLY SHIPPING MARKET INSIGHT - INTERMODAL
Wake me up when September ends - Theodore Ntalakos
Since last September most thought that the worst was behind us. It looks like the market de ...
Tuesday, 15 July 14
INDONESIA'S TOTAL COAL PRODUCTION REACHED ANOTHER HIGH DURING THE FIRST SIX MONTHS; GOVERNMENT EXPECTED TO RAISE ROYALTIES
COALspot.com: Indonesia's total coal production reached 213 million tons during January through June, up by 7.6 percent y-o-y. Coal output in I ...
Monday, 14 July 14
THE END OF THE ERA OF HEAVY FUEL OIL IN MARITIME SHIPPING - ICCT
KNOWLEDGE TO ELEVATE
Since the 1960s, heavy fuel oil (HFO) has been the king of marine fuels. Viscous, dirty, yet inexpensive and widely avail ...
Monday, 14 July 14
SGX SUB-BIT FOB INDONESIA COAL SWAP FOR Q4' 14 DELIVERY CLOSED AT $ 54.80
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on day, week and on month according to AsiaClear OTC coal swap's reports re ...
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- Neyveli Lignite Corporation Ltd, - India
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- Miang Besar Coal Terminal - Indonesia
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- Altura Mining Limited, Indonesia
- Mercuria Energy - Indonesia
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- GMR Energy Limited - India
- Sindya Power Generating Company Private Ltd
- Star Paper Mills Limited - India
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Wood Mackenzie - Singapore
- Maharashtra Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- SMC Global Power, Philippines
- Energy Link Ltd, New Zealand
- Independent Power Producers Association of India
- Ministry of Mines - Canada
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Xindia Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Bhushan Steel Limited - India
- Coastal Gujarat Power Limited - India
- Binh Thuan Hamico - Vietnam
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Marubeni Corporation - India
- VISA Power Limited - India
- Indonesian Coal Mining Association
- Petron Corporation, Philippines
- Georgia Ports Authority, United States
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Posco Energy - South Korea
- Mjunction Services Limited - India
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Lanco Infratech Ltd - India
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Oldendorff Carriers - Singapore
- Riau Bara Harum - Indonesia
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Straits Asia Resources Limited - Singapore
- Aditya Birla Group - India
- Krishnapatnam Port Company Ltd. - India
- Kohat Cement Company Ltd. - Pakistan
- Central Java Power - Indonesia
- Meenaskhi Energy Private Limited - India
- Orica Mining Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kobexindo Tractors - Indoneisa
- Iligan Light & Power Inc, Philippines
- London Commodity Brokers - England
- Indian Oil Corporation Limited
- Formosa Plastics Group - Taiwan
- Trasteel International SA, Italy
- Vedanta Resources Plc - India
- Bhatia International Limited - India
- Dalmia Cement Bharat India
- Sojitz Corporation - Japan
- Larsen & Toubro Limited - India
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Tata Chemicals Ltd - India
- Malabar Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Antam Resourcindo - Indonesia
- Indogreen Group - Indonesia
- Planning Commission, India
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
- Holcim Trading Pte Ltd - Singapore
- Sical Logistics Limited - India
- Leighton Contractors Pty Ltd - Australia
- Carbofer General Trading SA - India
- Jindal Steel & Power Ltd - India
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- Makarim & Taira - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Videocon Industries ltd - India
- SN Aboitiz Power Inc, Philippines
- Indian Energy Exchange, India
- Thai Mozambique Logistica
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Economic Council, Georgia
- Australian Commodity Traders Exchange
- Ind-Barath Power Infra Limited - India
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Banpu Public Company Limited - Thailand
- Electricity Authority, New Zealand
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- Kumho Petrochemical, South Korea
- Indika Energy - Indonesia
- Edison Trading Spa - Italy
- Jaiprakash Power Ventures ltd
- Medco Energi Mining Internasional
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Port Waratah Coal Services - Australia
- Indo Tambangraya Megah - Indonesia
- Pendopo Energi Batubara - Indonesia
- PowerSource Philippines DevCo
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Deloitte Consulting - India
- Meralco Power Generation, Philippines
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Borneo Indobara - Indonesia
- Chamber of Mines of South Africa
- Savvy Resources Ltd - HongKong
- Offshore Bulk Terminal Pte Ltd, Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining Corp, Philippines
- Manunggal Multi Energi - Indonesia
- IEA Clean Coal Centre - UK
- Cement Manufacturers Association - India
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Romanian Commodities Exchange
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Bayan Resources Tbk. - Indonesia
- McConnell Dowell - Australia
- Commonwealth Bank - Australia
- Baramulti Group, Indonesia
- Mintek Dendrill Indonesia
- Coalindo Energy - Indonesia
- CNBM International Corporation - China
- Renaissance Capital - South Africa
- GAC Shipping (India) Pvt Ltd
- PTC India Limited - India
- Gujarat Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- LBH Netherlands Bv - Netherlands
- Bulk Trading Sa - Switzerland
- Australian Coal Association
- Tamil Nadu electricity Board
- Cigading International Bulk Terminal - Indonesia
- SMG Consultants - Indonesia
- Anglo American - United Kingdom
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- TNB Fuel Sdn Bhd - Malaysia
- Aboitiz Power Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Energy Development Corp, Philippines
- San Jose City I Power Corp, Philippines
- Eastern Coal Council - USA
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