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