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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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Wednesday, 16 November 11
TAX OFFICE VOWS TO CRACK DOWN ON COAL MINERS - JP
The Jakarta Post reported that, the Finance Ministry’s Directorate General of Taxation says that it will strengthen its supervision of coal mi ...
Wednesday, 16 November 11
A STRONG WEEK FOR THE CAPES - BRS
A sharp bounce by the Cape market pushed the BDI up by 3% last week. This was despite a softening in the other indices with the Panamax, Supramax an ...
Monday, 14 November 11
BORL SEEKS 660K MT OF LOW SULPHUR COAL
COALspot.com - BORL India has issued a tender for around 660,000 MT of 4500 - 5500 kcal/kg sub-bituminous Coal.
Bharat Oman Refineries Ltd ...
Sunday, 13 November 11
BUNKER PRICES REMAINED FIRM
COALspot.com - The market seemed to recover this week with the BDI and Cape Index up.
The BDI was up by only about 2.86 pct closing at 1835 point ...
Saturday, 12 November 11
COALINDO ENERGY LAUNCHED INDEX FOR 3400 GAR COAL
COALspot.com - PT Coalindo Energy, in cooperation with Argus Media Limited, launched the coal index for low-rank coal with a calorific value of 3,40 ...
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- PetroVietnam Power Coal Import and Supply Company
- Coastal Gujarat Power Limited - India
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- Jorong Barutama Greston.PT - Indonesia
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Indian Oil Corporation Limited
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Georgia Ports Authority, United States
- Sojitz Corporation - Japan
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Wood Mackenzie - Singapore
- Savvy Resources Ltd - HongKong
- Toyota Tsusho Corporation, Japan
- Mintek Dendrill Indonesia
- Bhushan Steel Limited - India
- Australian Coal Association
- New Zealand Coal & Carbon
- Coal and Oil Company - UAE
- SMC Global Power, Philippines
- Energy Link Ltd, New Zealand
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- Straits Asia Resources Limited - Singapore
- Madhucon Powers Ltd - India
- Price Waterhouse Coopers - Russia
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- Meenaskhi Energy Private Limited - India
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- India Bulls Power Limited - India
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- Xindia Steels Limited - India
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- Global Coal Blending Company Limited - Australia
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- VISA Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- Kohat Cement Company Ltd. - Pakistan
- Orica Mining Services - Indonesia
- Makarim & Taira - Indonesia
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- SMG Consultants - Indonesia
- Essar Steel Hazira Ltd - India
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- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- Eastern Coal Council - USA
- AsiaOL BioFuels Corp., Philippines
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- Banpu Public Company Limited - Thailand
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- Renaissance Capital - South Africa
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- Miang Besar Coal Terminal - Indonesia
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- CNBM International Corporation - China
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Electricity Authority, New Zealand
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Indo Tambangraya Megah - Indonesia
- LBH Netherlands Bv - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Port Waratah Coal Services - Australia
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- Deloitte Consulting - India
- Sarangani Energy Corporation, Philippines
- ASAPP Information Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
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- Australian Commodity Traders Exchange
- Tata Chemicals Ltd - India
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- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Coalindo Energy - Indonesia
- Electricity Generating Authority of Thailand
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- Kobexindo Tractors - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Tamil Nadu electricity Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Riau Bara Harum - Indonesia
- Globalindo Alam Lestari - Indonesia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Sree Jayajothi Cements Limited - India
- Leighton Contractors Pty Ltd - Australia
- Chamber of Mines of South Africa
- The University of Queensland
- Bukit Makmur.PT - Indonesia
- San Jose City I Power Corp, Philippines
- MS Steel International - UAE
- Meralco Power Generation, Philippines
- Ministry of Finance - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Star Paper Mills Limited - India
- Parliament of New Zealand
- Energy Development Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Siam City Cement PLC, Thailand
- Pendopo Energi Batubara - Indonesia
- Dalmia Cement Bharat India
- Posco Energy - South Korea
- Heidelberg Cement - Germany
- Malabar Cements Ltd - India
- Formosa Plastics Group - Taiwan
- Vedanta Resources Plc - India
- London Commodity Brokers - England
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Karaikal Port Pvt Ltd - India
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- Metalloyd Limited - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Africa Commodities Group - South Africa
- Mjunction Services Limited - India
- Mercator Lines Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Medco Energi Mining Internasional
- GMR Energy Limited - India
- Minerals Council of Australia
- Thiess Contractors Indonesia
- Orica Australia Pty. Ltd.
- Siam City Cement - Thailand
- Merrill Lynch Commodities Europe
- Rio Tinto Coal - Australia
- Aboitiz Power Corporation - Philippines
- Bangladesh Power Developement Board
- Sinarmas Energy and Mining - Indonesia
- Samtan Co., Ltd - South Korea
- PNOC Exploration Corporation - Philippines
- Gujarat Sidhee Cement - India
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Petrochimia International Co. Ltd.- Taiwan
- Thai Mozambique Logistica
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
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