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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, 13 January 14
INDONESIAN ORE BAN TO HAVE LIMITED IMPACT ON CHINESE ALUMINIUM PRODUCERS, FITCH RATINGS SAYS
COALspot.com: Fitch Ratings says today that Indonesia's ban on exports of unprocessed mineral ore will have limited impact on Chinese aluminium pro ...
Sunday, 12 January 14
THE FREIGHT MARKET CONTINUE TO REMAIN WEAK NEXT WEEK - SOLYM CARRIERS
Wish You A very Happy New Year
COALspot.com: The market has dropped quite a lot as expected due to holidays and probably also the effect of ban o ...
Friday, 10 January 14
DECISION ON ORE EXPORT BAN WILL BE MADE TOMORROW: INDUSTRY MINISTER, JG SAYS
Industry Minister M.S. Hidayat dismissed reports on Thursday that the government had made a decision on the matter. “We will only make a decis ...
Friday, 10 January 14
US COAL PRODUCTION UP 5.8% ON WEEK IN WEEK ENDED SATURDAY 4 JANUARY
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.8 million short tons (mmst) of coal in ...
Thursday, 09 January 14
THE INDONESIAN GOVERNMENT EASES ORE EXPORT BAN
COALspot.com: The Indonesian government has finally agreed to ease the ore-export ban just a few days before the Sunday deadline amid protests from ...
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- San Jose City I Power Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Electricity Authority, New Zealand
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Aboitiz Power Corporation - Philippines
- Gujarat Sidhee Cement - India
- Siam City Cement - Thailand
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- Alfred C Toepfer International GmbH - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Videocon Industries ltd - India
- Eastern Coal Council - USA
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Mjunction Services Limited - India
- Altura Mining Limited, Indonesia
- Sojitz Corporation - Japan
- Georgia Ports Authority, United States
- The State Trading Corporation of India Ltd
- Africa Commodities Group - South Africa
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- Coalindo Energy - Indonesia
- SMG Consultants - Indonesia
- Standard Chartered Bank - UAE
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- ASAPP Information Group - India
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Madhucon Powers Ltd - India
- Indian Energy Exchange, India
- Mintek Dendrill Indonesia
- Sinarmas Energy and Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Jindal Steel & Power Ltd - India
- Sarangani Energy Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Iligan Light & Power Inc, Philippines
- Orica Australia Pty. Ltd.
- IHS Mccloskey Coal Group - USA
- Therma Luzon, Inc, Philippines
- Vedanta Resources Plc - India
- PTC India Limited - India
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Commodity Traders Exchange
- Wood Mackenzie - Singapore
- The Treasury - Australian Government
- Makarim & Taira - Indonesia
- Straits Asia Resources Limited - Singapore
- Australian Coal Association
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- Gujarat Mineral Development Corp Ltd - India
- Coastal Gujarat Power Limited - India
- SMC Global Power, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Indo Tambangraya Megah - Indonesia
- Star Paper Mills Limited - India
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Singapore Mercantile Exchange
- Malabar Cements Ltd - India
- Parliament of New Zealand
- Miang Besar Coal Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Bangladesh Power Developement Board
- Salva Resources Pvt Ltd - India
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Electricity Generating Authority of Thailand
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Riau Bara Harum - Indonesia
- Meenaskhi Energy Private Limited - India
- Economic Council, Georgia
- Larsen & Toubro Limited - India
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Chamber of Mines of South Africa
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Power Finance Corporation Ltd., India
- CIMB Investment Bank - Malaysia
- Gujarat Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Oldendorff Carriers - Singapore
- Simpson Spence & Young - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Sindya Power Generating Company Private Ltd
- Siam City Cement PLC, Thailand
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Ambuja Cements Ltd - India
- Barasentosa Lestari - Indonesia
- Marubeni Corporation - India
- Manunggal Multi Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Planning Commission, India
- Rashtriya Ispat Nigam Limited - India
- IEA Clean Coal Centre - UK
- Bukit Makmur.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Indika Energy - Indonesia
- Rio Tinto Coal - Australia
- Maharashtra Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ICICI Bank Limited - India
- Eastern Energy - Thailand
- Semirara Mining and Power Corporation, Philippines
- MS Steel International - UAE
- Uttam Galva Steels Limited - India
- Energy Link Ltd, New Zealand
- PNOC Exploration Corporation - Philippines
- Bhatia International Limited - India
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Deloitte Consulting - India
- Bharathi Cement Corporation - India
- Xindia Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- VISA Power Limited - India
- Merrill Lynch Commodities Europe
- Kepco SPC Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- Parry Sugars Refinery, India
- Kumho Petrochemical, South Korea
- Intertek Mineral Services - Indonesia
- Jaiprakash Power Ventures ltd
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- PowerSource Philippines DevCo
- Minerals Council of Australia
- Borneo Indobara - Indonesia
- Aditya Birla Group - India
- Thai Mozambique Logistica
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- Bank of Tokyo Mitsubishi UFJ Ltd
- Essar Steel Hazira Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- SN Aboitiz Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- Heidelberg Cement - Germany
- Lanco Infratech Ltd - India
- Toyota Tsusho Corporation, Japan
- International Coal Ventures Pvt Ltd - India
- London Commodity Brokers - England
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- Dalmia Cement Bharat India
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Global Business Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Globalindo Alam Lestari - Indonesia
- Central Electricity Authority - India
- CNBM International Corporation - China
- PetroVietnam Power Coal Import and Supply Company
- South Luzon Thermal Energy Corporation
- Meralco Power Generation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Karbindo Abesyapradhi - Indoneisa
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