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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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Thursday, 26 June 14
COAL DIVESTMENT CAMPAIGNS COME WITH RISKY UNINTENDED CONSEQUENCES - WCA
Last week I presented to the Expert Group on investments in coal and petroleum companies, the body set up to advise the Norwegian Government on whe ...
Wednesday, 25 June 14
INDONESIAN COAL EXPORTS ON RISE; EARNINGS FALL ON LOWER SELLING PRICES
COALspot.com: Indonesia, one of the world's largest coal producer and the global largest multi grade coal exporter shipped around $1.84* ...
Wednesday, 25 June 14
THE PANAMAX MARKET REACHED FRESH LOWS FOR THE YEAR, SAYS INTERMODAL
COALspot.com: The Dry Bulk market closed off the week noting a slight decrease, but this image of stability is merely representative of freight rat ...
Wednesday, 25 June 14
SHIPPING: MARKET INSIGHT - YANNIS OLZIERSKY
During his recent visit in London, China's Premier, Li Keqiang, announced that China's economy, the world's second largest after the US ...
Tuesday, 24 June 14
INDONESIAN COAL MINER TARGETS RP 313 BILLION IPO
COALspot.com: Indonesian coal miner PT Mitrabara Adiperdana is aiming to raise up to Rp 313 billion to Rp 368 billion (approximately $26.133 millio ...
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- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Ministry of Finance - Indonesia
- Madhucon Powers Ltd - India
- Banpu Public Company Limited - Thailand
- Meralco Power Generation, Philippines
- Mintek Dendrill Indonesia
- Straits Asia Resources Limited - Singapore
- San Jose City I Power Corp, Philippines
- Trasteel International SA, Italy
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- Rio Tinto Coal - Australia
- GAC Shipping (India) Pvt Ltd
- Mercuria Energy - Indonesia
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Bhatia International Limited - India
- Kalimantan Lumbung Energi - Indonesia
- MS Steel International - UAE
- Oldendorff Carriers - Singapore
- Alfred C Toepfer International GmbH - Germany
- Billiton Holdings Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Bulk Trading Sa - Switzerland
- Petron Corporation, Philippines
- Central Java Power - Indonesia
- Sarangani Energy Corporation, Philippines
- India Bulls Power Limited - India
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Carbofer General Trading SA - India
- Sindya Power Generating Company Private Ltd
- TeaM Sual Corporation - Philippines
- Parry Sugars Refinery, India
- Gujarat Mineral Development Corp Ltd - India
- Indika Energy - Indonesia
- Africa Commodities Group - South Africa
- Bhushan Steel Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Power Finance Corporation Ltd., India
- Eastern Energy - Thailand
- Interocean Group of Companies - India
- London Commodity Brokers - England
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- CNBM International Corporation - China
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Energy Link Ltd, New Zealand
- Maharashtra Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- Bukit Makmur.PT - Indonesia
- Planning Commission, India
- Indo Tambangraya Megah - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- AsiaOL BioFuels Corp., Philippines
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- PTC India Limited - India
- Sree Jayajothi Cements Limited - India
- Heidelberg Cement - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Wood Mackenzie - Singapore
- Timah Investasi Mineral - Indoneisa
- Global Business Power Corporation, Philippines
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- Kumho Petrochemical, South Korea
- Leighton Contractors Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- Rashtriya Ispat Nigam Limited - India
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Samtan Co., Ltd - South Korea
- Directorate General of MIneral and Coal - Indonesia
- Lanco Infratech Ltd - India
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- Ambuja Cements Ltd - India
- Cement Manufacturers Association - India
- Semirara Mining and Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Siam City Cement - Thailand
- Global Coal Blending Company Limited - Australia
- Tamil Nadu electricity Board
- Videocon Industries ltd - India
- Essar Steel Hazira Ltd - India
- Grasim Industreis Ltd - India
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- Tata Chemicals Ltd - India
- PNOC Exploration Corporation - Philippines
- McConnell Dowell - Australia
- Borneo Indobara - Indonesia
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Binh Thuan Hamico - Vietnam
- Sojitz Corporation - Japan
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- Xindia Steels Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Coal Association
- Antam Resourcindo - Indonesia
- PowerSource Philippines DevCo
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- GMR Energy Limited - India
- Australian Commodity Traders Exchange
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Latin American Coal - Colombia
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Wilmar Investment Holdings
- Siam City Cement PLC, Thailand
- Eastern Coal Council - USA
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Standard Chartered Bank - UAE
- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- Attock Cement Pakistan Limited
- SMC Global Power, Philippines
- Merrill Lynch Commodities Europe
- Salva Resources Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- The University of Queensland
- Central Electricity Authority - India
- Riau Bara Harum - Indonesia
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Bukit Baiduri Energy - Indonesia
- Intertek Mineral Services - Indonesia
- European Bulk Services B.V. - Netherlands
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Minerals Council of Australia
- South Luzon Thermal Energy Corporation
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Romanian Commodities Exchange
- Kideco Jaya Agung - Indonesia
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- Coal and Oil Company - UAE
- Jindal Steel & Power Ltd - India
- Savvy Resources Ltd - HongKong
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- Georgia Ports Authority, United States
- Petrochimia International Co. Ltd.- Taiwan
- White Energy Company Limited
- Ministry of Mines - Canada
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