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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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Wednesday, 04 March 20
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CHINA PROVINCE TO CLOSE 10 MLN TONNES OF COAL CAPACITY IN 2020 - XINHUA
Southwest China’s Guizhou Province plans to phase out 10 million tonnes of outdated coal production capacity by closing 80 coal mines in 2020 ...
Wednesday, 04 March 20
UKRAINE PRODUCED OVER 2.55 MLN TONNES OF COAL IN FEBRUARY - UKRINFORM
In February 2020, Ukraine produced over 2.55 million tonnes of coal, which is 0.2% less than planned.
The Coal Miners Union of Ukrai ...
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- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- Electricity Authority, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Mercuria Energy - Indonesia
- Malabar Cements Ltd - India
- VISA Power Limited - India
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- SMC Global Power, Philippines
- Makarim & Taira - Indonesia
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- GN Power Mariveles Coal Plant, Philippines
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- Economic Council, Georgia
- Simpson Spence & Young - Indonesia
- Attock Cement Pakistan Limited
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- Kalimantan Lumbung Energi - Indonesia
- Altura Mining Limited, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Parry Sugars Refinery, India
- Ministry of Finance - Indonesia
- Kideco Jaya Agung - Indonesia
- Samtan Co., Ltd - South Korea
- Port Waratah Coal Services - Australia
- Price Waterhouse Coopers - Russia
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Kumho Petrochemical, South Korea
- OPG Power Generation Pvt Ltd - India
- Edison Trading Spa - Italy
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Petron Corporation, Philippines
- Goldman Sachs - Singapore
- Iligan Light & Power Inc, Philippines
- SMG Consultants - Indonesia
- MS Steel International - UAE
- Anglo American - United Kingdom
- Tamil Nadu electricity Board
- The University of Queensland
- Global Green Power PLC Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Orica Australia Pty. Ltd.
- Aditya Birla Group - India
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Jindal Steel & Power Ltd - India
- White Energy Company Limited
- Neyveli Lignite Corporation Ltd, - India
- The Treasury - Australian Government
- Sakthi Sugars Limited - India
- Bharathi Cement Corporation - India
- Intertek Mineral Services - Indonesia
- Star Paper Mills Limited - India
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Meenaskhi Energy Private Limited - India
- Salva Resources Pvt Ltd - India
- Lanco Infratech Ltd - India
- Directorate Of Revenue Intelligence - India
- Directorate General of MIneral and Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kobexindo Tractors - Indoneisa
- McConnell Dowell - Australia
- Borneo Indobara - Indonesia
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- GAC Shipping (India) Pvt Ltd
- GVK Power & Infra Limited - India
- Carbofer General Trading SA - India
- Parliament of New Zealand
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Romanian Commodities Exchange
- Eastern Energy - Thailand
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- Bangladesh Power Developement Board
- Larsen & Toubro Limited - India
- Grasim Industreis Ltd - India
- Sical Logistics Limited - India
- Wood Mackenzie - Singapore
- Coastal Gujarat Power Limited - India
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- New Zealand Coal & Carbon
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Generating Authority of Thailand
- PetroVietnam Power Coal Import and Supply Company
- The State Trading Corporation of India Ltd
- Binh Thuan Hamico - Vietnam
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Indian Oil Corporation Limited
- CNBM International Corporation - China
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- Rashtriya Ispat Nigam Limited - India
- Kartika Selabumi Mining - Indonesia
- Xindia Steels Limited - India
- Planning Commission, India
- Marubeni Corporation - India
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- San Jose City I Power Corp, Philippines
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Independent Power Producers Association of India
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- Aboitiz Power Corporation - Philippines
- Trasteel International SA, Italy
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Sojitz Corporation - Japan
- Central Java Power - Indonesia
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Deloitte Consulting - India
- Miang Besar Coal Terminal - Indonesia
- ASAPP Information Group - India
- Wilmar Investment Holdings
- Gujarat Sidhee Cement - India
- Global Coal Blending Company Limited - Australia
- Chamber of Mines of South Africa
- Merrill Lynch Commodities Europe
- Mintek Dendrill Indonesia
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Commonwealth Bank - Australia
- Straits Asia Resources Limited - Singapore
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Agrawal Coal Company - India
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- TeaM Sual Corporation - Philippines
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- Ind-Barath Power Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Oldendorff Carriers - Singapore
- Coalindo Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Renaissance Capital - South Africa
- Heidelberg Cement - Germany
- Karaikal Port Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Ministry of Mines - Canada
- Africa Commodities Group - South Africa
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Riau Bara Harum - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- Jorong Barutama Greston.PT - Indonesia
- Indogreen Group - Indonesia
- Singapore Mercantile Exchange
- Ceylon Electricity Board - Sri Lanka
- Indonesian Coal Mining Association
- Latin American Coal - Colombia
- Minerals Council of Australia
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