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Tuesday, 06 September 11
INDONESIAS PROPOSED COAL EXPORT BAN MAY HAVE IMPACT ON THE INDIAN POWER SECTOR - DIPESH DIPU
.jpg) COALspot.com - This is a special interview about Indonesian proposed coal export ban by 2014, with Mr. Dipesh Dipu, Director of Deloitte Touche Tohmatsu, India.
The Indonesian government is currently in the process of drafting a new regulation that could ban the export of low-grade coal by January 12, 2014. This is likely to apply to coal below 5700 kcal/kg on air dried basis in value.
As of now Indonesia is producing around 150 million tons of coal with calorific value below 5700 GAD (according to chairman of Indonesian coal mining association). However by 2014, there are possibilities the total production of below 5700 GAD coal may reach more than 200 million per annum.
Will Indonesian coal export ban impact on the Indian fuel requirements?
The earlier grade of coal that was being considered for proposed ban has GCV of 5100 kcal/kg of less (adb), which can be comparable to 3800-4200 kcal/kg (arb) domestic coal available in India. This grade of coal has found favor in India primarily due to likely price advantage but economics of power generation based on such grade of imported coal may be a suspect. This considering that such grades of coal from Indonesia typically have high moisture content, which makes transportation cost per unit of energy generated higher. The quantum of the low grade of coal (<5100 kcal/kg adb) procured from Indonesia is likely to remain relatively low.
However, if the new definition of low grade coal is applied (<5700 kcal/kg adb), it may be reasonable to believe that such a ban may have impact on the Indian power sector as volumes in this grade of coal are expected to rise in the proportion of coal exports to India. Several of the acquisitions made by Indian power generation companies in Indonesia have been in coal blocks that will produce coal of this grade, and a blanket ban on the exports can jeopardize power plant development in India.
On the other hand, the domestic Indonesian market may not be prepared to consume all the coal mined of this grade in view of the power generation capacity addition plans in Indonesia. In such a case, the coal mine development is likely to be deferred. The Indonesian law makers may need to reconsider domestic market demand, investment climate in coal sector and impact of the legislation on the export revenues.
What is the alternative source for Indian power industry if the proposed coal export ban come into effect by 2014?
Indian power generation companies have been forced to look out for coal assets abroad due to the investment and regulatory environment within the country. India boasts of more than 110 billion tonnes of coal reserves, which largely fall within a 300 meters of depth. If the regulatory and investment environment is amended to allow greater participation of private sector Indian dependence on imports will be reduced.
However, for imports, India will continue to look at Indonesia, South Africa, Australia and newer destinations like Mozambique and Columbia. But these sources also have constraints, domestic demands in South Africa is likely to restrict quantum jump in exports out of South Africa. Indonesia has also proposed domestic market obligations. Mozambique may have infrastructure constraints for large volumes of coal being transported from Tete province to ports of Maputo, Ncala or Beira. Australian coal is of high quality but may have higher costs of mining and transport.
What would be the additional cost if Indian consumers switch their sourcing origin from Indonesia?
Indonesia has competitive advantage due to its geographical closeness. However, on a per tonne basis, assuming comparable quality, costs of transport may make marginal difference when compared with South Africa and Mozambique.
When compared to Australian coal, due to the high quality, cost of energy may well be comparable even though shipping costs are higher. Between Indonesian coal (5500 kcal/kg adb priced at USD 90 per tonne) and Australian coal (6500 kcal/kg adb priced at USD 120 per tonne), indicative variable cost difference of power generation may be about Indian Rupees 0.20 to 0.30 per kWh (electricity unit) in favor of Indonesian coal.
Will it affect Indian economy growth or this coal export ban is ignorable as India can easily identify alternative sources of fuel?
The magnitude of growth in power generation in India will necessarily mean that coal will remain the mainstay. Natural gas has had issues of availability. Nuclear plant development is facing socio-political challenge in view of the risks of technology failure. Development of hydel power has also faced issues of land acquisition, rehabilitation & resettlement apart from the technical issues of hydro-geological features. Renewable sources such as solar and wind generation are still projected to constitute a small portion of India power generation mix. Identifying an alternative source that can match coal in its accessibility, availability and affordability in the context of scale of capacity addition required in India is a challenge.
What is the Indian government's role on this issue, whether government has to come out with the solution such as easing Indian mining and environment law, open up mining for foreigners, G2G arrangement, etc…?
There is a need to look at domestic sources with pro-active and constructive approach and make all necessary legal and statutory amendments that make the resources available and mineable. Easing the regulations may not be one of such measures but making those regulations work in sync with each other in a time bound and predictable manner must certainly be.
There is certainly a case for opening the domestic coal sector for private participation, including independent miners, and for foreign participation so that newer technology and enhanced scale of operations are implemented in India. The regulation also needs to permit risk capital to come in for prospecting and exploration.
For imports the G2G relations can be leveraged to secure coal assets. India has good relationship with Indonesia and has also signed a tax treaty with Mozambique in 2010 which will facilitate investments. Government may also engage with these countries to ease exports to India and extend fiscal support to coal mining companies investing in mining and associated infrastructure development.
About Dipesh Dipu
Dipesh Dipu works as Director with Deloitte Touche Tohmatsu India Pvt. Ltd in the Energy and Resources consulting practice of the firm and anchors the Firm’s initiative in the mining and metals sectors.
He is a mining engineering graduate from Indian School of Mines and is a Chartered Financial Analyst (CFA). He has also done executive program in business management from Indian Institute of Management Calcutta. Dipesh has recently been awarded the Abheraj Baldota Gold Medal for the Young Mining Engineer of the Year 2007 by the Mining Engineers’ Association of India in recognition of his contributions in the improvement of mining industry in India.
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Tuesday, 07 April 20
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Showing 1026 to 1030 news of total 6871 |
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- Minerals Council of Australia
- Attock Cement Pakistan Limited
- Thai Mozambique Logistica
- Kobexindo Tractors - Indoneisa
- Interocean Group of Companies - India
- Cement Manufacturers Association - India
- Miang Besar Coal Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Standard Chartered Bank - UAE
- Directorate Of Revenue Intelligence - India
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- Semirara Mining Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Banpu Public Company Limited - Thailand
- Bhushan Steel Limited - India
- Romanian Commodities Exchange
- Cigading International Bulk Terminal - Indonesia
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- TNB Fuel Sdn Bhd - Malaysia
- Samtan Co., Ltd - South Korea
- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Star Paper Mills Limited - India
- GVK Power & Infra Limited - India
- Eastern Coal Council - USA
- Aditya Birla Group - India
- Lanco Infratech Ltd - India
- Savvy Resources Ltd - HongKong
- Simpson Spence & Young - Indonesia
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- Jaiprakash Power Ventures ltd
- Timah Investasi Mineral - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Riau Bara Harum - Indonesia
- Electricity Generating Authority of Thailand
- PTC India Limited - India
- Coastal Gujarat Power Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Coalindo Energy - Indonesia
- New Zealand Coal & Carbon
- Indo Tambangraya Megah - Indonesia
- Sakthi Sugars Limited - India
- Vizag Seaport Private Limited - India
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Tamil Nadu electricity Board
- Bharathi Cement Corporation - India
- Ambuja Cements Ltd - India
- Bukit Baiduri Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- PowerSource Philippines DevCo
- The University of Queensland
- Barasentosa Lestari - Indonesia
- Orica Australia Pty. Ltd.
- Bhoruka Overseas - Indonesia
- GMR Energy Limited - India
- India Bulls Power Limited - India
- White Energy Company Limited
- Parliament of New Zealand
- Indonesian Coal Mining Association
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Commonwealth Bank - Australia
- Kumho Petrochemical, South Korea
- Krishnapatnam Port Company Ltd. - India
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- Australian Coal Association
- SN Aboitiz Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- VISA Power Limited - India
- Sojitz Corporation - Japan
- Metalloyd Limited - United Kingdom
- Makarim & Taira - Indonesia
- Maheswari Brothers Coal Limited - India
- Australian Commodity Traders Exchange
- Kartika Selabumi Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- San Jose City I Power Corp, Philippines
- Global Coal Blending Company Limited - Australia
- Bukit Makmur.PT - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
- CNBM International Corporation - China
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Planning Commission, India
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Straits Asia Resources Limited - Singapore
- Bangladesh Power Developement Board
- Therma Luzon, Inc, Philippines
- Borneo Indobara - Indonesia
- Georgia Ports Authority, United States
- Petrochimia International Co. Ltd.- Taiwan
- Siam City Cement - Thailand
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Electricity Authority, New Zealand
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Billiton Holdings Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Thiess Contractors Indonesia
- Larsen & Toubro Limited - India
- The State Trading Corporation of India Ltd
- IHS Mccloskey Coal Group - USA
- Parry Sugars Refinery, India
- Binh Thuan Hamico - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Renaissance Capital - South Africa
- Chamber of Mines of South Africa
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Coal and Oil Company - UAE
- Singapore Mercantile Exchange
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- MS Steel International - UAE
- Bulk Trading Sa - Switzerland
- Directorate General of MIneral and Coal - Indonesia
- Petron Corporation, Philippines
- Antam Resourcindo - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Central Electricity Authority - India
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- LBH Netherlands Bv - Netherlands
- CIMB Investment Bank - Malaysia
- Independent Power Producers Association of India
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Sarangani Energy Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- GN Power Mariveles Coal Plant, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Neyveli Lignite Corporation Ltd, - India
- Malabar Cements Ltd - India
- ICICI Bank Limited - India
- Bhatia International Limited - India
- Dalmia Cement Bharat India
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Ind-Barath Power Infra Limited - India
- Meralco Power Generation, Philippines
- Marubeni Corporation - India
- SMC Global Power, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- South Luzon Thermal Energy Corporation
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- Mercuria Energy - Indonesia
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- Leighton Contractors Pty Ltd - Australia
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Grasim Industreis Ltd - India
- Sical Logistics Limited - India
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Formosa Plastics Group - Taiwan
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Anglo American - United Kingdom
- Edison Trading Spa - Italy
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
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