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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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Sunday, 09 December 12
LOW DEMAND PUSHES CHARTER RATES TOWARDS DOWN - VISTAAR
COALspot.com - The freight market has softened and BDI, The Baltic Dry Index, a measure of shipping costs for dry bulk goods, plunged below 10 ...
Friday, 07 December 12
A NEW PHASE FOR AUSTRALIAN RESOURCES - A FITCH STREET INTERVIEW
This week Matt Jamieson spoke with Andrew Colquhoun in Fitch's Asian sovereign rating team, and Vicky Melbourne, Fitch's commodity analyst based i ...
Friday, 07 December 12
SHIPPING INDUSTRY LOOKING ON YET ANOTHER TOUGH YEAR AS WE APPROACH 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With shipping finance "on the ropes" as traditional lenders appear to be cutting their losses and tonnage oversupply still the most import ...
Thursday, 06 December 12
PANAMAX : THE POSITIVE VIBES IN THE ATLANTIC REMAINS - FEARNLEYS AS
Handy
The Atlantic market is still depressed with dearth of cargoes and more ships. The trips from Continent to Feast fixed around USD 12k. Trips f ...
Thursday, 06 December 12
STRONG CHINESE DEMAND FOR DRY BULK COMMODITIES EXPECTED FOR 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A new analysis from BIMCO released yesterday suggests that 2013 is expected to be a stronger year in terms of China's "hunger" for commod ...
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- India Bulls Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Leighton Contractors Pty Ltd - Australia
- ASAPP Information Group - India
- Merrill Lynch Commodities Europe
- Krishnapatnam Port Company Ltd. - India
- Gujarat Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Commonwealth Bank - Australia
- Miang Besar Coal Terminal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- Indian Energy Exchange, India
- Binh Thuan Hamico - Vietnam
- Central Electricity Authority - India
- Bayan Resources Tbk. - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- SMC Global Power, Philippines
- Antam Resourcindo - Indonesia
- Trasteel International SA, Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sree Jayajothi Cements Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Cement Manufacturers Association - India
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Kumho Petrochemical, South Korea
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- Chettinad Cement Corporation Ltd - India
- Wilmar Investment Holdings
- AsiaOL BioFuels Corp., Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Iligan Light & Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- The University of Queensland
- GN Power Mariveles Coal Plant, Philippines
- Edison Trading Spa - Italy
- Thiess Contractors Indonesia
- Chamber of Mines of South Africa
- Dalmia Cement Bharat India
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- European Bulk Services B.V. - Netherlands
- The Treasury - Australian Government
- Renaissance Capital - South Africa
- Carbofer General Trading SA - India
- PNOC Exploration Corporation - Philippines
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Coal Council - USA
- Straits Asia Resources Limited - Singapore
- Bangladesh Power Developement Board
- Energy Development Corp, Philippines
- GMR Energy Limited - India
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Link Ltd, New Zealand
- Ministry of Transport, Egypt
- Intertek Mineral Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Deloitte Consulting - India
- CNBM International Corporation - China
- Anglo American - United Kingdom
- Indika Energy - Indonesia
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Power Finance Corporation Ltd., India
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Mercuria Energy - Indonesia
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- New Zealand Coal & Carbon
- Indo Tambangraya Megah - Indonesia
- Minerals Council of Australia
- Maheswari Brothers Coal Limited - India
- Agrawal Coal Company - India
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- MS Steel International - UAE
- Meenaskhi Energy Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- Tata Chemicals Ltd - India
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
- The State Trading Corporation of India Ltd
- Semirara Mining Corp, Philippines
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- Vedanta Resources Plc - India
- Rashtriya Ispat Nigam Limited - India
- Ambuja Cements Ltd - India
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- Jindal Steel & Power Ltd - India
- LBH Netherlands Bv - Netherlands
- Sakthi Sugars Limited - India
- Marubeni Corporation - India
- PowerSource Philippines DevCo
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- Georgia Ports Authority, United States
- OPG Power Generation Pvt Ltd - India
- Attock Cement Pakistan Limited
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Salva Resources Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Orica Mining Services - Indonesia
- Ministry of Finance - Indonesia
- Metalloyd Limited - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Star Paper Mills Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Central Java Power - Indonesia
- Madhucon Powers Ltd - India
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Ministry of Mines - Canada
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Sindya Power Generating Company Private Ltd
- Coalindo Energy - Indonesia
- London Commodity Brokers - England
- Sarangani Energy Corporation, Philippines
- Goldman Sachs - Singapore
- Kideco Jaya Agung - Indonesia
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Bukit Makmur.PT - Indonesia
- Oldendorff Carriers - Singapore
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- Australian Coal Association
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Global Green Power PLC Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Barasentosa Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Siam City Cement - Thailand
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- Karaikal Port Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Riau Bara Harum - Indonesia
- Bhatia International Limited - India
- Bukit Baiduri Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Global Business Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Mercator Lines Limited - India
- Kapuas Tunggal Persada - Indonesia
- Singapore Mercantile Exchange
- PTC India Limited - India
- Planning Commission, India
- SN Aboitiz Power Inc, Philippines
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- Latin American Coal - Colombia
- IHS Mccloskey Coal Group - USA
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- TeaM Sual Corporation - Philippines
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Meralco Power Generation, Philippines
- Aboitiz Power Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- International Coal Ventures Pvt Ltd - India
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