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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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Friday, 08 February 13
NORTH P&I CLUB WARNS OF LIQUEFACTION RISK FOR BAUXITE CARGOES
The ‘A’ rated 170 million GT North P&I club has warned shipowners carrying bauxite aluminium ore cargoes that they have the potentia ...
Thursday, 07 February 13
CHINA NDRC APPROVED 10 BILLION YUAN POWER GENERATION PROJECTS
NDRC of China currently announced that some of power grid and power station in Jiangxu, Sichuan and Anhui Province would be newly constructed or ext ...
Thursday, 07 February 13
CAPESIZE : MORE ACTIVE WEEK IN THE PACIFIC - FEARNLEYS AS
Handy
The Atlantic market remained stable with no significant movement in rates. Rates from USG to FEast were around USD 18k and Black Sea to Feast ...
Thursday, 07 February 13
WEAK STEEL MARKET MEANS IRON ORE RALLY LIKELY TO END SOON - FITCH
The sharp rebound in iron ore prices over the last couple of months will hurt margins at non-integrated steel producers in the first quarter of 2013 ...
Tuesday, 05 February 13
THE SHIPPING SECTOR IS " NAVIGATING IN STORMY WATERS" - PWC
The vulnerabilities of the global economy have been exposed and have more than played their part in making 2011 one of the worst years of shipping i ...
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- Thai Mozambique Logistica
- PetroVietnam Power Coal Import and Supply Company
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- IEA Clean Coal Centre - UK
- Bukit Baiduri Energy - Indonesia
- Dalmia Cement Bharat India
- Georgia Ports Authority, United States
- Eastern Energy - Thailand
- Indian Energy Exchange, India
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
- Xindia Steels Limited - India
- Meralco Power Generation, Philippines
- GAC Shipping (India) Pvt Ltd
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- Aboitiz Power Corporation - Philippines
- Australian Coal Association
- Siam City Cement - Thailand
- Mjunction Services Limited - India
- Medco Energi Mining Internasional
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- Kohat Cement Company Ltd. - Pakistan
- Uttam Galva Steels Limited - India
- Jindal Steel & Power Ltd - India
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- International Coal Ventures Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Economic Council, Georgia
- Electricity Authority, New Zealand
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- Mercuria Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Binh Thuan Hamico - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Edison Trading Spa - Italy
- Bhatia International Limited - India
- Aditya Birla Group - India
- Vedanta Resources Plc - India
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Planning Commission, India
- Merrill Lynch Commodities Europe
- Indian Oil Corporation Limited
- Petron Corporation, Philippines
- Power Finance Corporation Ltd., India
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- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Carbofer General Trading SA - India
- Kartika Selabumi Mining - Indonesia
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- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sinarmas Energy and Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kapuas Tunggal Persada - Indonesia
- GVK Power & Infra Limited - India
- Rashtriya Ispat Nigam Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Simpson Spence & Young - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Renaissance Capital - South Africa
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Bhushan Steel Limited - India
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Toyota Tsusho Corporation, Japan
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Samtan Co., Ltd - South Korea
- Deloitte Consulting - India
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- Central Java Power - Indonesia
- Iligan Light & Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- PowerSource Philippines DevCo
- Bharathi Cement Corporation - India
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Sojitz Corporation - Japan
- Africa Commodities Group - South Africa
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- IHS Mccloskey Coal Group - USA
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Indika Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Riau Bara Harum - Indonesia
- Price Waterhouse Coopers - Russia
- Lanco Infratech Ltd - India
- Electricity Generating Authority of Thailand
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Orica Australia Pty. Ltd.
- Globalindo Alam Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Malabar Cements Ltd - India
- Therma Luzon, Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Baramulti Group, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Thiess Contractors Indonesia
- ASAPP Information Group - India
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Minerals Council of Australia
- Chamber of Mines of South Africa
- Barasentosa Lestari - Indonesia
- Ministry of Finance - Indonesia
- Singapore Mercantile Exchange
- Metalloyd Limited - United Kingdom
- San Jose City I Power Corp, Philippines
- Eastern Coal Council - USA
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- Banpu Public Company Limited - Thailand
- Marubeni Corporation - India
- Central Electricity Authority - India
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- Energy Link Ltd, New Zealand
- Antam Resourcindo - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- CNBM International Corporation - China
- Maharashtra Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- New Zealand Coal & Carbon
- Semirara Mining and Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Wilmar Investment Holdings
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- VISA Power Limited - India
- Interocean Group of Companies - India
- Bhoruka Overseas - Indonesia
- Savvy Resources Ltd - HongKong
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- MS Steel International - UAE
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- The University of Queensland
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- SMG Consultants - Indonesia
- Global Green Power PLC Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Vizag Seaport Private Limited - India
- Port Waratah Coal Services - Australia
- Directorate Of Revenue Intelligence - India
- Heidelberg Cement - Germany
- Cigading International Bulk Terminal - Indonesia
- Cement Manufacturers Association - India
- Madhucon Powers Ltd - India
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- White Energy Company Limited
- Sical Logistics Limited - India
- Holcim Trading Pte Ltd - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Karbindo Abesyapradhi - Indoneisa
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