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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, 26 February 20
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Showing 1106 to 1110 news of total 6871 |
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- Siam City Cement PLC, Thailand
- Kideco Jaya Agung - Indonesia
- Borneo Indobara - Indonesia
- Port Waratah Coal Services - Australia
- Mercator Lines Limited - India
- Samtan Co., Ltd - South Korea
- Simpson Spence & Young - Indonesia
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Toyota Tsusho Corporation, Japan
- Sinarmas Energy and Mining - Indonesia
- Coalindo Energy - Indonesia
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- AsiaOL BioFuels Corp., Philippines
- Mjunction Services Limited - India
- Medco Energi Mining Internasional
- Merrill Lynch Commodities Europe
- McConnell Dowell - Australia
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- SN Aboitiz Power Inc, Philippines
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Bhatia International Limited - India
- Alfred C Toepfer International GmbH - Germany
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- International Coal Ventures Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- Kaltim Prima Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Neyveli Lignite Corporation Ltd, - India
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Economic Council, Georgia
- The State Trading Corporation of India Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Riau Bara Harum - Indonesia
- Indogreen Group - Indonesia
- Planning Commission, India
- Aboitiz Power Corporation - Philippines
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- PTC India Limited - India
- Rashtriya Ispat Nigam Limited - India
- Salva Resources Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Baramulti Group, Indonesia
- Oldendorff Carriers - Singapore
- CNBM International Corporation - China
- Manunggal Multi Energi - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Georgia Ports Authority, United States
- Mintek Dendrill Indonesia
- Orica Mining Services - Indonesia
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Carbofer General Trading SA - India
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Ind-Barath Power Infra Limited - India
- Deloitte Consulting - India
- Indian Energy Exchange, India
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Vedanta Resources Plc - India
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Malabar Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Orica Australia Pty. Ltd.
- Power Finance Corporation Ltd., India
- Chettinad Cement Corporation Ltd - India
- VISA Power Limited - India
- Bhushan Steel Limited - India
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- Renaissance Capital - South Africa
- Indika Energy - Indonesia
- Vizag Seaport Private Limited - India
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Kobexindo Tractors - Indoneisa
- PNOC Exploration Corporation - Philippines
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- CIMB Investment Bank - Malaysia
- Commonwealth Bank - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- TeaM Sual Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Makarim & Taira - Indonesia
- Antam Resourcindo - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Billiton Holdings Pty Ltd - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Binh Thuan Hamico - Vietnam
- Barasentosa Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Petron Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Asmin Koalindo Tuhup - Indonesia
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Altura Mining Limited, Indonesia
- Interocean Group of Companies - India
- Karaikal Port Pvt Ltd - India
- Romanian Commodities Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- Attock Cement Pakistan Limited
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Kalimantan Lumbung Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- London Commodity Brokers - England
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Kohat Cement Company Ltd. - Pakistan
- Central Java Power - Indonesia
- Thai Mozambique Logistica
- White Energy Company Limited
- Global Green Power PLC Corporation, Philippines
- Standard Chartered Bank - UAE
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Posco Energy - South Korea
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Parliament of New Zealand
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- Mercuria Energy - Indonesia
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Xindia Steels Limited - India
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Dalmia Cement Bharat India
- Sical Logistics Limited - India
- Ministry of Finance - Indonesia
- Therma Luzon, Inc, Philippines
- Sakthi Sugars Limited - India
- Global Business Power Corporation, Philippines
- MS Steel International - UAE
- Australian Coal Association
- Tamil Nadu electricity Board
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- Grasim Industreis Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- Essar Steel Hazira Ltd - India
- Ambuja Cements Ltd - India
- Videocon Industries ltd - India
- Trasteel International SA, Italy
- Jorong Barutama Greston.PT - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Electricity Authority, New Zealand
- Sindya Power Generating Company Private Ltd
- Eastern Coal Council - USA
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
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