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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, 08 December 11
INDIA MAY SEE 41% ANNUAL GROWTH OF ITS COAL DEMAND DURING THE NEXT 5 YEARS - ICAP SHIPPING
India’s Ministry of Coal expects that India’s coal demand may face an annual 41% rise during the next 5 years, while its coal deficit is ...
Thursday, 08 December 11
HAREDA KRIDA GETS CONTRACT FROM BAYAN - INSIDER STORIES
Insider Stories reported that, coal miner PT Bayan Resources Tbk (BYAN), through its subsidiary dubbed PT Gunungbayan Pratamacoal (GPB), has signed ...
Thursday, 08 December 11
CAPESIZES LIFT DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize vessels yesterday helped lift the dry bulk market which had been falling since the start of the week on lower cargo demand. As a result the ...
Wednesday, 07 December 11
ABM INVESTAMA EYES RP6.3 TRIO REVENUE - INSIDER STORIES
Insider Stories reported that, an energy integrated company PT ABM Investama Tbk is eyeing a 1.5 folds increase in revenue this year from Rp4. ...
Tuesday, 06 December 11
DRY BULK MARKET ENDS RALLY, STARTS WEEK WITH FALL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
After a series of increases which saw the dry bulk market’s benchmark, the Baltic Dry Index (BDI) increasing close to 1,900 points and rates o ...
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- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- Anglo American - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Indian Oil Corporation Limited
- Directorate General of MIneral and Coal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Toyota Tsusho Corporation, Japan
- Asmin Koalindo Tuhup - Indonesia
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Mines - Canada
- Standard Chartered Bank - UAE
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Leighton Contractors Pty Ltd - Australia
- Iligan Light & Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Tata Chemicals Ltd - India
- Therma Luzon, Inc, Philippines
- Posco Energy - South Korea
- Alfred C Toepfer International GmbH - Germany
- Maheswari Brothers Coal Limited - India
- Eastern Coal Council - USA
- Riau Bara Harum - Indonesia
- The State Trading Corporation of India Ltd
- Grasim Industreis Ltd - India
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Sarangani Energy Corporation, Philippines
- Kumho Petrochemical, South Korea
- Chamber of Mines of South Africa
- Sical Logistics Limited - India
- Savvy Resources Ltd - HongKong
- Ambuja Cements Ltd - India
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Star Paper Mills Limited - India
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Global Coal Blending Company Limited - Australia
- GMR Energy Limited - India
- Thiess Contractors Indonesia
- Makarim & Taira - Indonesia
- SMC Global Power, Philippines
- Larsen & Toubro Limited - India
- Ministry of Finance - Indonesia
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Gujarat Electricity Regulatory Commission - India
- Simpson Spence & Young - Indonesia
- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- Vizag Seaport Private Limited - India
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Bukit Makmur.PT - Indonesia
- Price Waterhouse Coopers - Russia
- Ceylon Electricity Board - Sri Lanka
- Sakthi Sugars Limited - India
- Energy Development Corp, Philippines
- Central Java Power - Indonesia
- Tamil Nadu electricity Board
- Manunggal Multi Energi - Indonesia
- White Energy Company Limited
- Economic Council, Georgia
- South Luzon Thermal Energy Corporation
- Renaissance Capital - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chettinad Cement Corporation Ltd - India
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- Edison Trading Spa - Italy
- Singapore Mercantile Exchange
- Vijayanagar Sugar Pvt Ltd - India
- PTC India Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Indika Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- Mercuria Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- ASAPP Information Group - India
- Essar Steel Hazira Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Bhatia International Limited - India
- Australian Commodity Traders Exchange
- Electricity Authority, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- ICICI Bank Limited - India
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- European Bulk Services B.V. - Netherlands
- Central Electricity Authority - India
- Indonesian Coal Mining Association
- Oldendorff Carriers - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Power Finance Corporation Ltd., India
- Semirara Mining Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Rio Tinto Coal - Australia
- GAC Shipping (India) Pvt Ltd
- Australian Coal Association
- Antam Resourcindo - Indonesia
- Kepco SPC Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Coalindo Energy - Indonesia
- Baramulti Group, Indonesia
- Cement Manufacturers Association - India
- Kideco Jaya Agung - Indonesia
- Intertek Mineral Services - Indonesia
- Heidelberg Cement - Germany
- Metalloyd Limited - United Kingdom
- IHS Mccloskey Coal Group - USA
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- Aditya Birla Group - India
- Meenaskhi Energy Private Limited - India
- Global Green Power PLC Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- LBH Netherlands Bv - Netherlands
- Meralco Power Generation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- The University of Queensland
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Uttam Galva Steels Limited - India
- Indogreen Group - Indonesia
- Marubeni Corporation - India
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Commonwealth Bank - Australia
- Banpu Public Company Limited - Thailand
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Holcim Trading Pte Ltd - Singapore
- Videocon Industries ltd - India
- Billiton Holdings Pty Ltd - Australia
- The Treasury - Australian Government
- Maharashtra Electricity Regulatory Commission - India
- CNBM International Corporation - China
- Trasteel International SA, Italy
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- San Jose City I Power Corp, Philippines
- Bhoruka Overseas - Indonesia
- Wilmar Investment Holdings
- Samtan Co., Ltd - South Korea
- Parry Sugars Refinery, India
- Latin American Coal - Colombia
- Timah Investasi Mineral - Indoneisa
- Bhushan Steel Limited - India
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Bukit Baiduri Energy - Indonesia
- Bangladesh Power Developement Board
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Minerals Council of Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
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