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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, 02 January 12
THE PROMISE OF INDIA: A BRIEF INTERRUPTION? - CLARKSONS / HELLENIC SHIPPING
Future growth in Indian seaborne coal imports has sometimes been considered as one of the largest potential upsides in the currently oversupplied dr ...
Sunday, 01 January 12
IS INDIA FOLLOWING INDONESIA TO STANDARDIZE COAL PRICES TO GET MAXIMUM BENEFITS?
COALspot.com - Coal India limited, an Indian state owned and world largest coal producer has introduced gross calorific value (GCV) based pricing me ...
Saturday, 31 December 11
GLOBALCOAL NEWC INDEX SURGED 2.32 PERCENT
COALspot.com - globalCOAL index in Newcastle Port, benchmark for Asian market, ended substantially higher, surged 2.32 percent to US$115.47 per ...
Saturday, 31 December 11
BORNEO LUMBUNG TO BUY BUMI STAKE, SWAP CEO - THE JAKARTA GLOBE
The Jakarta Globe, one of the leading english news paper in Indonesia reported yesterday, shareholders of Indonesian coking coal miner Borneo Lumbun ...
Friday, 30 December 11
CENTRAL GOVERNMENT SHOULD ISSUE PERMITS - THE JAKARTA POST
The Jakarta Post reported that, business associations from both the palm oil and mining sectors have suggested that the central government should re ...
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- Vedanta Resources Plc - India
- Kaltim Prima Coal - Indonesia
- Simpson Spence & Young - Indonesia
- Savvy Resources Ltd - HongKong
- Independent Power Producers Association of India
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
- AsiaOL BioFuels Corp., Philippines
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Rio Tinto Coal - Australia
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Coalindo Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Australian Commodity Traders Exchange
- Edison Trading Spa - Italy
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Central Java Power - Indonesia
- Merrill Lynch Commodities Europe
- Iligan Light & Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Finance - Indonesia
- Standard Chartered Bank - UAE
- Kideco Jaya Agung - Indonesia
- Eastern Coal Council - USA
- Aditya Birla Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- Jindal Steel & Power Ltd - India
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- Chamber of Mines of South Africa
- The University of Queensland
- IHS Mccloskey Coal Group - USA
- Kepco SPC Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- Bukit Baiduri Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Global Coal Blending Company Limited - Australia
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Kohat Cement Company Ltd. - Pakistan
- Sojitz Corporation - Japan
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- International Coal Ventures Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- The State Trading Corporation of India Ltd
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Xindia Steels Limited - India
- Sakthi Sugars Limited - India
- Aboitiz Power Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Altura Mining Limited, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- Wilmar Investment Holdings
- Miang Besar Coal Terminal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Thai Mozambique Logistica
- Planning Commission, India
- Bahari Cakrawala Sebuku - Indonesia
- Cement Manufacturers Association - India
- Price Waterhouse Coopers - Russia
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Therma Luzon, Inc, Philippines
- Indonesian Coal Mining Association
- Siam City Cement PLC, Thailand
- Goldman Sachs - Singapore
- Posco Energy - South Korea
- Thiess Contractors Indonesia
- Tata Chemicals Ltd - India
- Rashtriya Ispat Nigam Limited - India
- GAC Shipping (India) Pvt Ltd
- Indian Energy Exchange, India
- Ministry of Mines - Canada
- PNOC Exploration Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Coastal Gujarat Power Limited - India
- Meralco Power Generation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Economic Council, Georgia
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Pendopo Energi Batubara - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Manunggal Multi Energi - Indonesia
- Trasteel International SA, Italy
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- Central Electricity Authority - India
- VISA Power Limited - India
- Indian Oil Corporation Limited
- The Treasury - Australian Government
- Petron Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- SN Aboitiz Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Ambuja Cements Ltd - India
- Power Finance Corporation Ltd., India
- Maheswari Brothers Coal Limited - India
- San Jose City I Power Corp, Philippines
- Carbofer General Trading SA - India
- Alfred C Toepfer International GmbH - Germany
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Africa Commodities Group - South Africa
- Sical Logistics Limited - India
- TeaM Sual Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Sidhee Cement - India
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bhoruka Overseas - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Electricity Generating Authority of Thailand
- Gujarat Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Antam Resourcindo - Indonesia
- Karaikal Port Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Mjunction Services Limited - India
- Sindya Power Generating Company Private Ltd
- Salva Resources Pvt Ltd - India
- Coal and Oil Company - UAE
- Port Waratah Coal Services - Australia
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- PTC India Limited - India
- Indogreen Group - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Siam City Cement - Thailand
- Banpu Public Company Limited - Thailand
- Karbindo Abesyapradhi - Indoneisa
- London Commodity Brokers - England
- PowerSource Philippines DevCo
- ICICI Bank Limited - India
- Malabar Cements Ltd - India
- Samtan Co., Ltd - South Korea
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- Jorong Barutama Greston.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Star Paper Mills Limited - India
- Riau Bara Harum - Indonesia
- Oldendorff Carriers - Singapore
- Tamil Nadu electricity Board
- Madhucon Powers Ltd - India
- Minerals Council of Australia
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Eastern Energy - Thailand
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- Agrawal Coal Company - India
- MS Steel International - UAE
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SMC Global Power, Philippines
- ASAPP Information Group - India
- Kapuas Tunggal Persada - Indonesia
- Mintek Dendrill Indonesia
- Directorate Of Revenue Intelligence - India
- Orica Australia Pty. Ltd.
- CNBM International Corporation - China
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Indo Tambangraya Megah - Indonesia
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Interocean Group of Companies - India
- Bangladesh Power Developement Board
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