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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, 23 May 23
INDIA: COAL OUTPUT UP 8.9%, SUPPLY RISES 11.7% IN APRIL - FINANCIAL EXPRESS
India’s coal production jumped 8.85% to 73.14 million tonne (MT) in April 2023 and the total coal despatch during the month went up 11.66% to ...
Tuesday, 23 May 23
CHINA COAL OUTPUT UP 4.5 PCT IN APRIL - XINHUA
China’s raw coal output posted stable expansion in April, official data showed.
The country produced 380 million tonnes of raw ...
Saturday, 20 May 23
NON-OPEC OIL SUPPLY DEVELOPMENT - OPEC
In 2022, non-OPEC supply is estimated to have increased by 1.9 mb/d y-o-y. Out of this, US liquids production increased by 1.2 mb/d, mainly on the ...
Saturday, 20 May 23
GLOBAL COAL TRADE HAS REALLY PICKED UP PACE IN RECENT MONTHS, NOW FULLY BACK TO PRE-COVID LEVELS - BANCHERO COSTA
Global coal trade has really picked up pace in recent months, and is now fully back to pre-Covid levels. In Jan-Apr 2023, total global seaborne coa ...
Saturday, 20 May 23
MARKET INSIGHT - INTERMODAL
India is one of the world's largest coal producers and one of the world's largest importers of coal. The country uses coal mainly for power ...
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Showing 101 to 105 news of total 6871 |
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- Thai Mozambique Logistica
- San Jose City I Power Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- The University of Queensland
- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- IHS Mccloskey Coal Group - USA
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- Attock Cement Pakistan Limited
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Kaltim Prima Coal - Indonesia
- Jaiprakash Power Ventures ltd
- Marubeni Corporation - India
- Posco Energy - South Korea
- Xindia Steels Limited - India
- Manunggal Multi Energi - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Videocon Industries ltd - India
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Orica Mining Services - Indonesia
- Bharathi Cement Corporation - India
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- Wood Mackenzie - Singapore
- Eastern Energy - Thailand
- Renaissance Capital - South Africa
- Standard Chartered Bank - UAE
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Mjunction Services Limited - India
- Leighton Contractors Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- PetroVietnam Power Coal Import and Supply Company
- Timah Investasi Mineral - Indoneisa
- Kepco SPC Power Corporation, Philippines
- GVK Power & Infra Limited - India
- The State Trading Corporation of India Ltd
- Semirara Mining Corp, Philippines
- Anglo American - United Kingdom
- Dalmia Cement Bharat India
- International Coal Ventures Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Borneo Indobara - Indonesia
- Latin American Coal - Colombia
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- Ceylon Electricity Board - Sri Lanka
- Kideco Jaya Agung - Indonesia
- Mercator Lines Limited - India
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Medco Energi Mining Internasional
- Deloitte Consulting - India
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- McConnell Dowell - Australia
- Minerals Council of Australia
- Australian Commodity Traders Exchange
- Indo Tambangraya Megah - Indonesia
- CNBM International Corporation - China
- Aditya Birla Group - India
- Kapuas Tunggal Persada - Indonesia
- Indian Oil Corporation Limited
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Sical Logistics Limited - India
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- Singapore Mercantile Exchange
- Banpu Public Company Limited - Thailand
- Simpson Spence & Young - Indonesia
- Ministry of Transport, Egypt
- SN Aboitiz Power Inc, Philippines
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Lanco Infratech Ltd - India
- Sakthi Sugars Limited - India
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PowerSource Philippines DevCo
- PNOC Exploration Corporation - Philippines
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- Vedanta Resources Plc - India
- Aboitiz Power Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Essar Steel Hazira Ltd - India
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Wilmar Investment Holdings
- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- VISA Power Limited - India
- Maheswari Brothers Coal Limited - India
- Parry Sugars Refinery, India
- Merrill Lynch Commodities Europe
- Malabar Cements Ltd - India
- Ambuja Cements Ltd - India
- Energy Development Corp, Philippines
- Independent Power Producers Association of India
- Bhoruka Overseas - Indonesia
- Cement Manufacturers Association - India
- Sinarmas Energy and Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Indika Energy - Indonesia
- GMR Energy Limited - India
- Central Electricity Authority - India
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Makmur.PT - Indonesia
- Oldendorff Carriers - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Riau Bara Harum - Indonesia
- South Luzon Thermal Energy Corporation
- Antam Resourcindo - Indonesia
- Australian Coal Association
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- New Zealand Coal & Carbon
- TeaM Sual Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Binh Thuan Hamico - Vietnam
- CIMB Investment Bank - Malaysia
- Georgia Ports Authority, United States
- Meralco Power Generation, Philippines
- Toyota Tsusho Corporation, Japan
- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Carbofer General Trading SA - India
- Edison Trading Spa - Italy
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Samtan Co., Ltd - South Korea
- Power Finance Corporation Ltd., India
- Krishnapatnam Port Company Ltd. - India
- Star Paper Mills Limited - India
- Central Java Power - Indonesia
- Ministry of Mines - Canada
- Petrochimia International Co. Ltd.- Taiwan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Metalloyd Limited - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Heidelberg Cement - Germany
- Energy Link Ltd, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Finance - Indonesia
- Meenaskhi Energy Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- Bulk Trading Sa - Switzerland
- Straits Asia Resources Limited - Singapore
- Indogreen Group - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- The Treasury - Australian Government
- AsiaOL BioFuels Corp., Philippines
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