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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, 07 November 13
THE ENERGY INDUSTRY'S RISING WATER CHALLENGE - WOOD MACKENZIE
Water poses a variety of business risks for the energy industry, and could play an influential role in shaping the future energy supply mix, accordi ...
Thursday, 07 November 13
HANDY : INDO/CHINA ROUNDS ARE SEEING BIDS AT AROUND $16K
Handy
In the Atlantic we have seen more activity this week with several fixtures being concluded at firm rates. USG/Feast been reported at 30k and ...
Wednesday, 06 November 13
THE BIGGER SIZE SEGMENTS LOST GROUND WHILE SUPRAS AND HANDIES HELD ON TO THEIR GAINS - INTERMODAL
Chartering (Wet: Stable+ / Dry: Stable- )
A mirror image of the week prior for the Dry Bulk market, as once more the bigger size segments los ...
Wednesday, 06 November 13
WILL NEW ORDERS DRIVE THE MARKET DOWN AGAIN ONCE DELIVERIES COMMENCE
"While there are many concerns on whether the new orders will drive the market down again once deliveries commence, the second half of 2013 has ...
Tuesday, 05 November 13
AUSTRALIA'S NEWCASTLE PORT SEES DROP IN COAL EXPORTS W-W
COALspot.com: In the week ended November 4, Power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totaled 2.77 m ...
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- Orica Australia Pty. Ltd.
- Manunggal Multi Energi - Indonesia
- Jindal Steel & Power Ltd - India
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- GAC Shipping (India) Pvt Ltd
- Thiess Contractors Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Riau Bara Harum - Indonesia
- Economic Council, Georgia
- Ministry of Transport, Egypt
- Indogreen Group - Indonesia
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- CNBM International Corporation - China
- Energy Development Corp, Philippines
- Planning Commission, India
- Kapuas Tunggal Persada - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Minerals Council of Australia
- Ministry of Mines - Canada
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- GMR Energy Limited - India
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sree Jayajothi Cements Limited - India
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- Posco Energy - South Korea
- Therma Luzon, Inc, Philippines
- Mercuria Energy - Indonesia
- Kumho Petrochemical, South Korea
- Commonwealth Bank - Australia
- McConnell Dowell - Australia
- Cigading International Bulk Terminal - Indonesia
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Videocon Industries ltd - India
- Bharathi Cement Corporation - India
- Formosa Plastics Group - Taiwan
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Australian Coal Association
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meenaskhi Energy Private Limited - India
- Directorate Of Revenue Intelligence - India
- Orica Mining Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Savvy Resources Ltd - HongKong
- Altura Mining Limited, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- Ministry of Finance - Indonesia
- Baramulti Group, Indonesia
- Siam City Cement PLC, Thailand
- Antam Resourcindo - Indonesia
- Coalindo Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Barasentosa Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- New Zealand Coal & Carbon
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Interocean Group of Companies - India
- Ambuja Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Grasim Industreis Ltd - India
- Simpson Spence & Young - Indonesia
- Pendopo Energi Batubara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Bangladesh Power Developement Board
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- PowerSource Philippines DevCo
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Chamber of Mines of South Africa
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- Tamil Nadu electricity Board
- ASAPP Information Group - India
- Krishnapatnam Port Company Ltd. - India
- Vijayanagar Sugar Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- Sakthi Sugars Limited - India
- Banpu Public Company Limited - Thailand
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Meralco Power Generation, Philippines
- Ind-Barath Power Infra Limited - India
- Dalmia Cement Bharat India
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Bhatia International Limited - India
- Petron Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- Romanian Commodities Exchange
- Kohat Cement Company Ltd. - Pakistan
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
- Independent Power Producers Association of India
- GN Power Mariveles Coal Plant, Philippines
- Parry Sugars Refinery, India
- Miang Besar Coal Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Bhushan Steel Limited - India
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jaiprakash Power Ventures ltd
- Mjunction Services Limited - India
- Eastern Coal Council - USA
- Georgia Ports Authority, United States
- Central Electricity Authority - India
- Gujarat Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Generating Authority of Thailand
- India Bulls Power Limited - India
- Gujarat Sidhee Cement - India
- Indian Oil Corporation Limited
- Wood Mackenzie - Singapore
- Price Waterhouse Coopers - Russia
- Binh Thuan Hamico - Vietnam
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- The University of Queensland
- Siam City Cement - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- White Energy Company Limited
- VISA Power Limited - India
- Eastern Energy - Thailand
- PTC India Limited - India
- Borneo Indobara - Indonesia
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Bukit Baiduri Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- Latin American Coal - Colombia
- Oldendorff Carriers - Singapore
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- San Jose City I Power Corp, Philippines
- Carbofer General Trading SA - India
- Kartika Selabumi Mining - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Essar Steel Hazira Ltd - India
- Tata Chemicals Ltd - India
- Deloitte Consulting - India
- SMG Consultants - Indonesia
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