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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, 15 May 14
USA COAL CONFERENCE
Press Release: IHS Inc. (NYSE: IHS), the leading global source of information and analysis, will host the Coal USA Conference, June 18-20, 2014, ...
Wednesday, 14 May 14
COAL PRICES IN CHINA HAVE DROPPED TO THEIR LOWEST LEVELS SINCE END-2008
COALspot.com: Coal prices in China have dropped to their lowest levels since end-2008, Fitch says in its latest rating report on one of the coal ...
Wednesday, 14 May 14
ALMOST THROUGH THE HALF OF THE YEAR, THE DRY BULK INDEX SHOW SIGNS OF WEAKNESS; CREATING TO BOTH EXISTING SHIP OWNERS AND POTENTIAL INVESTORS A LOT OF INSECURITY - PANOS MAKRINOS
Almost through the half of the year, the overall shipping market and more specifically the Dry Bulk Index show signs of weakness, creating to bo ...
Tuesday, 13 May 14
NPC COAL EXPORT VOLUMES PLUNGE TO 2.48 MMT WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 12 May 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Quee ...
Tuesday, 13 May 14
YET ANOTHER POSIDONIA EXHIBITION IS ON ITS WAY - INTERMODAL
With less than a month to go before another Posidonia exhibition starts and all the parties and celebrations get under way we thought that it wo ...
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- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
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- Barasentosa Lestari - Indonesia
- SMC Global Power, Philippines
- Lanco Infratech Ltd - India
- New Zealand Coal & Carbon
- Rio Tinto Coal - Australia
- Global Business Power Corporation, Philippines
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Africa Commodities Group - South Africa
- The Treasury - Australian Government
- Singapore Mercantile Exchange
- Kobexindo Tractors - Indoneisa
- Deloitte Consulting - India
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
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- Independent Power Producers Association of India
- Minerals Council of Australia
- Eastern Coal Council - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jorong Barutama Greston.PT - Indonesia
- Marubeni Corporation - India
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Savvy Resources Ltd - HongKong
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- SMG Consultants - Indonesia
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- Sarangani Energy Corporation, Philippines
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- Coastal Gujarat Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Billiton Holdings Pty Ltd - Australia
- Sojitz Corporation - Japan
- Australian Commodity Traders Exchange
- Maheswari Brothers Coal Limited - India
- Madhucon Powers Ltd - India
- Aditya Birla Group - India
- Indo Tambangraya Megah - Indonesia
- Economic Council, Georgia
- Siam City Cement PLC, Thailand
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- India Bulls Power Limited - India
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Ceylon Electricity Board - Sri Lanka
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- Holcim Trading Pte Ltd - Singapore
- Central Electricity Authority - India
- Meenaskhi Energy Private Limited - India
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Ministry of Finance - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Semirara Mining Corp, Philippines
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- Eastern Energy - Thailand
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Pendopo Energi Batubara - Indonesia
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Riau Bara Harum - Indonesia
- Bharathi Cement Corporation - India
- Binh Thuan Hamico - Vietnam
- Ministry of Mines - Canada
- Petron Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Directorate Of Revenue Intelligence - India
- Kumho Petrochemical, South Korea
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Anglo American - United Kingdom
- Oldendorff Carriers - Singapore
- Krishnapatnam Port Company Ltd. - India
- Salva Resources Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- Samtan Co., Ltd - South Korea
- Commonwealth Bank - Australia
- Toyota Tsusho Corporation, Japan
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- CNBM International Corporation - China
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- Indonesian Coal Mining Association
- VISA Power Limited - India
- Australian Coal Association
- Vizag Seaport Private Limited - India
- GVK Power & Infra Limited - India
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Price Waterhouse Coopers - Russia
- Wilmar Investment Holdings
- Bahari Cakrawala Sebuku - Indonesia
- Ind-Barath Power Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- ICICI Bank Limited - India
- Renaissance Capital - South Africa
- Vedanta Resources Plc - India
- Latin American Coal - Colombia
- Energy Development Corp, Philippines
- Mercator Lines Limited - India
- Bulk Trading Sa - Switzerland
- MS Steel International - UAE
- Power Finance Corporation Ltd., India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Neyveli Lignite Corporation Ltd, - India
- Siam City Cement - Thailand
- Borneo Indobara - Indonesia
- Uttam Galva Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Bhoruka Overseas - Indonesia
- Grasim Industreis Ltd - India
- White Energy Company Limited
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Cement Manufacturers Association - India
- Asmin Koalindo Tuhup - Indonesia
- McConnell Dowell - Australia
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- South Luzon Thermal Energy Corporation
- Globalindo Alam Lestari - Indonesia
- PNOC Exploration Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Indika Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Malabar Cements Ltd - India
- Parry Sugars Refinery, India
- Karaikal Port Pvt Ltd - India
- Mintek Dendrill Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Simpson Spence & Young - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Orica Mining Services - Indonesia
- London Commodity Brokers - England
- Leighton Contractors Pty Ltd - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Makarim & Taira - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Kaltim Prima Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- Thai Mozambique Logistica
- PowerSource Philippines DevCo
- IHS Mccloskey Coal Group - USA
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- GMR Energy Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Bayan Resources Tbk. - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- Maharashtra Electricity Regulatory Commission - India
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