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