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