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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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Monday, 31 March 14
CFR SOUTH CHINA COAL SWAP FOR Q2 14 DELIVERY LOST 1.17% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.17 percent month on month and closed at US$ 75.38 per m ...
Sunday, 30 March 14
FREIGHTS FROM INDONESIA TO INDIA IS EXPECTED TO BE SOFT NEXT WEEK - REDDY
COALspot.com: The freight market dropped drastically and all sectors were affected severely.
The BDI was down by 14.13 pct and closed at 1, ...
Friday, 28 March 14
US PRODUCED APPROXIMATELY 18.9 MMST IN A WEEK - EIA
COALspot.com – United States the world's second largest coal producer, produced approximately 18.9 million short tons (mmst) of coal i ...
Friday, 28 March 14
CHINA'S ENVIRONMENTAL MEASURES WILL NOT CURB GROWTH IN DOMESTIC STEEL PRODUCTION AND SEABORNE IRON ORE - WOOD MACKENZIE SAYS
Steel plants in China have been targeted as a major source of the toxic smog enveloping Beijing and Shanghai. Emergency measures have been impos ...
Thursday, 27 March 14
PANAMAX : SEEMS TO HEAD FURTHER DOWN; CAPESIZE : ANOTHER CHOPPY AND UNPREDICTABLE WEEK - FEARNLEYS AS
Handy
A weaker sentiment for the smaller size as well, with reduced activity in the Atlantic where Owners have to face significantly lower ret ...
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- Deloitte Consulting - India
- Therma Luzon, Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Ministry of Finance - Indonesia
- Grasim Industreis Ltd - India
- Renaissance Capital - South Africa
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SN Aboitiz Power Inc, Philippines
- Standard Chartered Bank - UAE
- Baramulti Group, Indonesia
- India Bulls Power Limited - India
- Wilmar Investment Holdings
- Bangladesh Power Developement Board
- Sree Jayajothi Cements Limited - India
- Sindya Power Generating Company Private Ltd
- Australian Commodity Traders Exchange
- Global Green Power PLC Corporation, Philippines
- Port Waratah Coal Services - Australia
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- PNOC Exploration Corporation - Philippines
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Cement Manufacturers Association - India
- Kobexindo Tractors - Indoneisa
- Sarangani Energy Corporation, Philippines
- Gujarat Sidhee Cement - India
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Global Coal Blending Company Limited - Australia
- PTC India Limited - India
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Planning Commission, India
- Singapore Mercantile Exchange
- VISA Power Limited - India
- Ministry of Mines - Canada
- Meralco Power Generation, Philippines
- Orica Australia Pty. Ltd.
- Manunggal Multi Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Indonesian Coal Mining Association
- Gujarat Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Vedanta Resources Plc - India
- CNBM International Corporation - China
- CIMB Investment Bank - Malaysia
- GMR Energy Limited - India
- Kumho Petrochemical, South Korea
- Thiess Contractors Indonesia
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bayan Resources Tbk. - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Bahari Cakrawala Sebuku - Indonesia
- SMC Global Power, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Marubeni Corporation - India
- London Commodity Brokers - England
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Indika Energy - Indonesia
- Heidelberg Cement - Germany
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- The State Trading Corporation of India Ltd
- Malabar Cements Ltd - India
- IEA Clean Coal Centre - UK
- Madhucon Powers Ltd - India
- Makarim & Taira - Indonesia
- Jaiprakash Power Ventures ltd
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Jindal Steel & Power Ltd - India
- Iligan Light & Power Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Lanco Infratech Ltd - India
- Videocon Industries ltd - India
- European Bulk Services B.V. - Netherlands
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Orica Mining Services - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Antam Resourcindo - Indonesia
- Commonwealth Bank - Australia
- Kaltim Prima Coal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- Energy Link Ltd, New Zealand
- White Energy Company Limited
- Economic Council, Georgia
- Romanian Commodities Exchange
- GN Power Mariveles Coal Plant, Philippines
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Sakthi Sugars Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- Global Business Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Tamil Nadu electricity Board
- SMG Consultants - Indonesia
- Chamber of Mines of South Africa
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Bhatia International Limited - India
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Bharathi Cement Corporation - India
- ICICI Bank Limited - India
- Uttam Galva Steels Limited - India
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Riau Bara Harum - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Xindia Steels Limited - India
- Interocean Group of Companies - India
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Carbofer General Trading SA - India
- McConnell Dowell - Australia
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Simpson Spence & Young - Indonesia
- New Zealand Coal & Carbon
- Altura Mining Limited, Indonesia
- Indian Energy Exchange, India
- The University of Queensland
- Mercuria Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- GVK Power & Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Minerals Council of Australia
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- Georgia Ports Authority, United States
- Aditya Birla Group - India
- The Treasury - Australian Government
- Globalindo Alam Lestari - Indonesia
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Directorate Of Revenue Intelligence - India
- Medco Energi Mining Internasional
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Oldendorff Carriers - Singapore
- San Jose City I Power Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Miang Besar Coal Terminal - Indonesia
- Ministry of Transport, Egypt
- Wood Mackenzie - Singapore
- Coal and Oil Company - UAE
- AsiaOL BioFuels Corp., Philippines
- ASAPP Information Group - India
- Alfred C Toepfer International GmbH - Germany
- Petron Corporation, Philippines
- Star Paper Mills Limited - India
- Trasteel International SA, Italy
- Posco Energy - South Korea
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Larsen & Toubro Limited - India
- Agrawal Coal Company - India
- Coalindo Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- IHS Mccloskey Coal Group - USA
- Neyveli Lignite Corporation Ltd, - India
- Attock Cement Pakistan Limited
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
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