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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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Tuesday, 07 January 20
CLEANER AIR IN 2020: 0.5% SULPHUR CAP FOR SHIPS ENTERS INTO FORCE WORLDWIDE - EUROPEAN COMMISSION
From 1 January 2020, the maximum sulphur content of marine fuels is reduced to 0.5% (down from 3.5%) globally – reducing air pollution and pr ...
Tuesday, 07 January 20
BHP EYES INDIA FOR COAL GROWTH AS CHINA DEMAND FLATLINES - SYDNEY MORNING HERALD
Australia’s largest miner, BHP, believes the long-term trajectory of the emerging economy of India and the acceleration of its steelmaking ou ...
Sunday, 05 January 20
BUNKER QUALITY CLAIMS IN 2020 - ISSUES TO CONSIDER - CLYDE&CO
KNOWLEDGE TO ELEVATE
In recent years the shipping industry has faced a significant number of bunker quality claims, most notably ari ...
Saturday, 04 January 20
SUPRAMAX: A 53,000DWT VESSEL FIXING DELIVERY INDONESIA TRIP TO CHINA AT $4,000 AND A 58,000DWT SHIP FIXING DELIVERY EAST KALIMANTAN TRIP TO THAILAND AT $5,500 - BALTIC BRIEFING
Capesize
The New Year started with an erosion on pre-Christmas rates as the higher low sulphur fuel costs due to IMO 2020 affected levels. From ...
Thursday, 02 January 20
DMO 2020 PRICE SET FOR ELECTRICITY SECTOR - IAN WOLLFF
On the 26th December 2019, the Minister of Energy and Mineral Resources (ESDM) issued the decree No. 261.K/30.MEM/2019 about the States needs for c ...
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Showing 1211 to 1215 news of total 6871 |
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- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Kobexindo Tractors - Indoneisa
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Parliament of New Zealand
- Ambuja Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining and Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- IEA Clean Coal Centre - UK
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- Bayan Resources Tbk. - Indonesia
- PNOC Exploration Corporation - Philippines
- VISA Power Limited - India
- Commonwealth Bank - Australia
- Standard Chartered Bank - UAE
- Wood Mackenzie - Singapore
- San Jose City I Power Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- South Luzon Thermal Energy Corporation
- Global Coal Blending Company Limited - Australia
- Petron Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Planning Commission, India
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Eastern Coal Council - USA
- Central Java Power - Indonesia
- TeaM Sual Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Price Waterhouse Coopers - Russia
- Coal and Oil Company - UAE
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- Thai Mozambique Logistica
- Asmin Koalindo Tuhup - Indonesia
- Energy Link Ltd, New Zealand
- Sinarmas Energy and Mining - Indonesia
- Georgia Ports Authority, United States
- SMC Global Power, Philippines
- Power Finance Corporation Ltd., India
- GVK Power & Infra Limited - India
- Mercator Lines Limited - India
- Chamber of Mines of South Africa
- Therma Luzon, Inc, Philippines
- Goldman Sachs - Singapore
- Rio Tinto Coal - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vijayanagar Sugar Pvt Ltd - India
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Gujarat Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sree Jayajothi Cements Limited - India
- Meralco Power Generation, Philippines
- Samtan Co., Ltd - South Korea
- Oldendorff Carriers - Singapore
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- Singapore Mercantile Exchange
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- Ceylon Electricity Board - Sri Lanka
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Binh Thuan Hamico - Vietnam
- Orica Mining Services - Indonesia
- Essar Steel Hazira Ltd - India
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- CNBM International Corporation - China
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- Indo Tambangraya Megah - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- LBH Netherlands Bv - Netherlands
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- The State Trading Corporation of India Ltd
- Bukit Baiduri Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- MS Steel International - UAE
- Economic Council, Georgia
- Australian Commodity Traders Exchange
- Karaikal Port Pvt Ltd - India
- Independent Power Producers Association of India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- Romanian Commodities Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- PetroVietnam Power Coal Import and Supply Company
- Mercuria Energy - Indonesia
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- Iligan Light & Power Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Parry Sugars Refinery, India
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- IHS Mccloskey Coal Group - USA
- Renaissance Capital - South Africa
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- Medco Energi Mining Internasional
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- Attock Cement Pakistan Limited
- Malabar Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- Bukit Makmur.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Ministry of Finance - Indonesia
- PTC India Limited - India
- Deloitte Consulting - India
- Ministry of Mines - Canada
- Vizag Seaport Private Limited - India
- Interocean Group of Companies - India
- Sojitz Corporation - Japan
- Posco Energy - South Korea
- Tamil Nadu electricity Board
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Petrochimia International Co. Ltd.- Taiwan
- Ind-Barath Power Infra Limited - India
- Indonesian Coal Mining Association
- Globalindo Alam Lestari - Indonesia
- GMR Energy Limited - India
- Electricity Generating Authority of Thailand
- Banpu Public Company Limited - Thailand
- Bharathi Cement Corporation - India
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Straits Asia Resources Limited - Singapore
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- Kartika Selabumi Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Electricity Authority, New Zealand
- Tata Chemicals Ltd - India
- London Commodity Brokers - England
- Leighton Contractors Pty Ltd - Australia
- Riau Bara Harum - Indonesia
- Sakthi Sugars Limited - India
- India Bulls Power Limited - India
- Miang Besar Coal Terminal - Indonesia
- Trasteel International SA, Italy
- Dalmia Cement Bharat India
- Borneo Indobara - Indonesia
- Coalindo Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Sarangani Energy Corporation, Philippines
- Merrill Lynch Commodities Europe
- The University of Queensland
- Heidelberg Cement - Germany
- Grasim Industreis Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Antam Resourcindo - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Madhucon Powers Ltd - India
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Salva Resources Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Kepco SPC Power Corporation, Philippines
- Eastern Energy - Thailand
- ASAPP Information Group - India
- McConnell Dowell - Australia
- Metalloyd Limited - United Kingdom
- Maharashtra Electricity Regulatory Commission - India
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