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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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Thursday, 30 January 20
PRIVATE SECTOR COMPANIES SEEK 'LEVEL PLAYING FIELD' FOR COAL BLOCK AUCTION - PTI
Private sector companies scouting opportunities for commercial coal mining in the country are seeking a “level playing field” to encour ...
Thursday, 30 January 20
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Wednesday, 29 January 20
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Wednesday, 29 January 20
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INDONESIA - UNCERTAINTY OVER AVAILABILITY OF LSFO - THE STANDARD CLUB
The club has received reports that low sulphur fuel is not currently readily available in all Indonesian ports and that there are local shortages.
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- Sical Logistics Limited - India
- Banpu Public Company Limited - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Thai Mozambique Logistica
- Karbindo Abesyapradhi - Indoneisa
- Ind-Barath Power Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- LBH Netherlands Bv - Netherlands
- Tamil Nadu electricity Board
- Jindal Steel & Power Ltd - India
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Merrill Lynch Commodities Europe
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bharathi Cement Corporation - India
- Electricity Authority, New Zealand
- Indika Energy - Indonesia
- Orica Australia Pty. Ltd.
- Cement Manufacturers Association - India
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Georgia Ports Authority, United States
- Australian Coal Association
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Iligan Light & Power Inc, Philippines
- GVK Power & Infra Limited - India
- Grasim Industreis Ltd - India
- Madhucon Powers Ltd - India
- Kobexindo Tractors - Indoneisa
- Global Business Power Corporation, Philippines
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Ministry of Mines - Canada
- ASAPP Information Group - India
- London Commodity Brokers - England
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining and Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Directorate General of MIneral and Coal - Indonesia
- San Jose City I Power Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- Africa Commodities Group - South Africa
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- SMG Consultants - Indonesia
- Borneo Indobara - Indonesia
- Petron Corporation, Philippines
- Gujarat Sidhee Cement - India
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- White Energy Company Limited
- Timah Investasi Mineral - Indoneisa
- Formosa Plastics Group - Taiwan
- Krishnapatnam Port Company Ltd. - India
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Gujarat Mineral Development Corp Ltd - India
- Bhoruka Overseas - Indonesia
- Edison Trading Spa - Italy
- New Zealand Coal & Carbon
- Therma Luzon, Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- Central Electricity Authority - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Sindya Power Generating Company Private Ltd
- PTC India Limited - India
- Medco Energi Mining Internasional
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- Globalindo Alam Lestari - Indonesia
- Goldman Sachs - Singapore
- The Treasury - Australian Government
- Agrawal Coal Company - India
- Thiess Contractors Indonesia
- Parry Sugars Refinery, India
- Videocon Industries ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- MS Steel International - UAE
- Bukit Baiduri Energy - Indonesia
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Posco Energy - South Korea
- Standard Chartered Bank - UAE
- Karaikal Port Pvt Ltd - India
- Malabar Cements Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- PNOC Exploration Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Aditya Birla Group - India
- Vizag Seaport Private Limited - India
- Bhushan Steel Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- VISA Power Limited - India
- Kumho Petrochemical, South Korea
- Meenaskhi Energy Private Limited - India
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Larsen & Toubro Limited - India
- Vedanta Resources Plc - India
- Sojitz Corporation - Japan
- CNBM International Corporation - China
- Coastal Gujarat Power Limited - India
- Planning Commission, India
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Romanian Commodities Exchange
- India Bulls Power Limited - India
- Antam Resourcindo - Indonesia
- Carbofer General Trading SA - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- GMR Energy Limited - India
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Wilmar Investment Holdings
- Heidelberg Cement - Germany
- The State Trading Corporation of India Ltd
- Eastern Energy - Thailand
- The University of Queensland
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Lanco Infratech Ltd - India
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Sarangani Energy Corporation, Philippines
- Ambuja Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Coalindo Energy - Indonesia
- Bangladesh Power Developement Board
- Straits Asia Resources Limited - Singapore
- Bukit Makmur.PT - Indonesia
- Commonwealth Bank - Australia
- Parliament of New Zealand
- SN Aboitiz Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Intertek Mineral Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Indian Energy Exchange, India
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Aboitiz Power Corporation - Philippines
- Semirara Mining Corp, Philippines
- Makarim & Taira - Indonesia
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Star Paper Mills Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Mercator Lines Limited - India
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- Meralco Power Generation, Philippines
- Global Green Power PLC Corporation, Philippines
- Uttam Galva Steels Limited - India
- Interocean Group of Companies - India
- Tata Chemicals Ltd - India
- Maheswari Brothers Coal Limited - India
- Oldendorff Carriers - Singapore
- Kapuas Tunggal Persada - Indonesia
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