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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, 08 May 14
'TRIAL BY MEDIA, TRIAL BY LAW' - A REPORT FROM TRACK 1 OF BIMCO'S ANNUAL CONFERENCE DUBAI 2014
KNOWLEDGE TO ELEVATE
Aiming to bring a very different type of event into their annual conference, BIMCO presented ‘Double Jeopardy &n ...
Thursday, 08 May 14
INDONESIAN COAL PRICE REFERENCE IN MAY CRASHES THROUGH $74
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has revised down again the coal bench mark price by US$ 1.21 / MT to ...
Wednesday, 07 May 14
THE DRY BULK MARKET HAS NOTED ANOTHER WEEKLY POSITIVE GAIN
Chartering (Wet: Softer- / Dry: Stable+)
The Dry Bulk market has noted another weekly positive gain, driven by the Capesize segment, but we ne ...
Wednesday, 07 May 14
SGX ENHANCES ITS COMMODITIES PRODUCT OFFERING
COALspot.com: SGX is building up its bulk commodity product offerings with 9 more derivative contracts over the next 2 months, subject to regula ...
Tuesday, 06 May 14
NEWCASTLE COAL EXPORT SLIPS 7.92% WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 5 May 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland ...
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- CIMB Investment Bank - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- VISA Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Indonesian Coal Mining Association
- Parry Sugars Refinery, India
- Larsen & Toubro Limited - India
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- IEA Clean Coal Centre - UK
- Semirara Mining and Power Corporation, Philippines
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Coastal Gujarat Power Limited - India
- ICICI Bank Limited - India
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Bangladesh Power Developement Board
- The Treasury - Australian Government
- Australian Commodity Traders Exchange
- Formosa Plastics Group - Taiwan
- McConnell Dowell - Australia
- Eastern Energy - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Energy Development Corp, Philippines
- The University of Queensland
- Kohat Cement Company Ltd. - Pakistan
- Heidelberg Cement - Germany
- Anglo American - United Kingdom
- Gujarat Sidhee Cement - India
- Maharashtra Electricity Regulatory Commission - India
- Sakthi Sugars Limited - India
- Central Electricity Authority - India
- SMG Consultants - Indonesia
- Samtan Co., Ltd - South Korea
- Indogreen Group - Indonesia
- Bukit Makmur.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Coalindo Energy - Indonesia
- Parliament of New Zealand
- Siam City Cement - Thailand
- Karaikal Port Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- IHS Mccloskey Coal Group - USA
- Barasentosa Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Electricity Authority, New Zealand
- Mercuria Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Petron Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Tamil Nadu electricity Board
- Wood Mackenzie - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Iligan Light & Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- Mjunction Services Limited - India
- SMC Global Power, Philippines
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Manunggal Multi Energi - Indonesia
- Oldendorff Carriers - Singapore
- Global Business Power Corporation, Philippines
- Sojitz Corporation - Japan
- Baramulti Group, Indonesia
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Maheswari Brothers Coal Limited - India
- Trasteel International SA, Italy
- Kobexindo Tractors - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Krishnapatnam Port Company Ltd. - India
- Aboitiz Power Corporation - Philippines
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- Star Paper Mills Limited - India
- Minerals Council of Australia
- Power Finance Corporation Ltd., India
- AsiaOL BioFuels Corp., Philippines
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Grasim Industreis Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Merrill Lynch Commodities Europe
- Renaissance Capital - South Africa
- Alfred C Toepfer International GmbH - Germany
- Planning Commission, India
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Ambuja Cements Ltd - India
- London Commodity Brokers - England
- Central Java Power - Indonesia
- Ministry of Mines - Canada
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- Australian Coal Association
- Mercator Lines Limited - India
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Borneo Indobara - Indonesia
- Vizag Seaport Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Mintek Dendrill Indonesia
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Edison Trading Spa - Italy
- White Energy Company Limited
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Malabar Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Chamber of Mines of South Africa
- Georgia Ports Authority, United States
- Africa Commodities Group - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Orica Mining Services - Indonesia
- Indika Energy - Indonesia
- Meralco Power Generation, Philippines
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Indian Energy Exchange, India
- Cement Manufacturers Association - India
- SN Aboitiz Power Inc, Philippines
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Jaiprakash Power Ventures ltd
- Bhatia International Limited - India
- Interocean Group of Companies - India
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Kideco Jaya Agung - Indonesia
- Kumho Petrochemical, South Korea
- Carbofer General Trading SA - India
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Semirara Mining Corp, Philippines
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- Antam Resourcindo - Indonesia
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- Coal and Oil Company - UAE
- Banpu Public Company Limited - Thailand
- Thai Mozambique Logistica
- Sree Jayajothi Cements Limited - India
- Kapuas Tunggal Persada - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- Essar Steel Hazira Ltd - India
- Miang Besar Coal Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Global Coal Blending Company Limited - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- New Zealand Coal & Carbon
- Price Waterhouse Coopers - Russia
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Transport, Egypt
- Sical Logistics Limited - India
- San Jose City I Power Corp, Philippines
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