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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, 02 January 20
SULPHUR 2020 COMPENDIUM - HOW ARE INDIVIDUAL PORT STATES EXPECTED TO REACT? - STANDARD CLUB
KNOWLEDGE TO ELEVATE
With the new sulphur limits soon to be in force, Standard Club has been investigating the ways in which certain jurisdict ...
Monday, 30 December 19
AUSTRALIAN MINERS HIT BY LOWEST THERMAL COAL PRICE IN MORE THAN A DECADE - THE GUARDIAN
Australian coal exporters have experienced the biggest annual drop in thermal coal prices in more than a decade during 2019, raising doubts about i ...
Monday, 30 December 19
INDIA'S COAL IMPORTS RISE 4% TO 161.43 MT IN APRIL-NOVEMBER 2019 - PTI
The country’s coal imports registered an increase of 4.4 per cent to 161.43 million tonnes (MT) in the April-November period of the ongoing f ...
Sunday, 29 December 19
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Sunday, 29 December 19
IMO 2020 COMPLIANCE: IT'S UP TO US TO BE GOOD CITIZENS - IBIA
One of the concerns around implementation of the 0.50% sulphur limit has been, and continues to be, the need for effective enforcement to ensure a ...
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Showing 1216 to 1220 news of total 6871 |
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- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bukit Makmur.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Australian Commodity Traders Exchange
- Karaikal Port Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Kideco Jaya Agung - Indonesia
- Ministry of Finance - Indonesia
- PTC India Limited - India
- McConnell Dowell - Australia
- Romanian Commodities Exchange
- Gujarat Sidhee Cement - India
- Samtan Co., Ltd - South Korea
- Parliament of New Zealand
- CNBM International Corporation - China
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- Thai Mozambique Logistica
- Indonesian Coal Mining Association
- OPG Power Generation Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Borneo Indobara - Indonesia
- Vedanta Resources Plc - India
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- CIMB Investment Bank - Malaysia
- Videocon Industries ltd - India
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Commonwealth Bank - Australia
- Anglo American - United Kingdom
- GMR Energy Limited - India
- Maheswari Brothers Coal Limited - India
- Kobexindo Tractors - Indoneisa
- Kumho Petrochemical, South Korea
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- Ambuja Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Cement Manufacturers Association - India
- Rashtriya Ispat Nigam Limited - India
- Ind-Barath Power Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Leighton Contractors Pty Ltd - Australia
- Madhucon Powers Ltd - India
- Australian Coal Association
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Coal and Oil Company - UAE
- Intertek Mineral Services - Indonesia
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Heidelberg Cement - Germany
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Jorong Barutama Greston.PT - Indonesia
- Chamber of Mines of South Africa
- Vizag Seaport Private Limited - India
- Savvy Resources Ltd - HongKong
- Central Electricity Authority - India
- PNOC Exploration Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bhushan Steel Limited - India
- Neyveli Lignite Corporation Ltd, - India
- VISA Power Limited - India
- Banpu Public Company Limited - Thailand
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- Malabar Cements Ltd - India
- Latin American Coal - Colombia
- TNB Fuel Sdn Bhd - Malaysia
- Chettinad Cement Corporation Ltd - India
- Renaissance Capital - South Africa
- Krishnapatnam Port Company Ltd. - India
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Deloitte Consulting - India
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Central Java Power - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Interocean Group of Companies - India
- PowerSource Philippines DevCo
- PetroVietnam Power Coal Import and Supply Company
- Uttam Galva Steels Limited - India
- Karbindo Abesyapradhi - Indoneisa
- GVK Power & Infra Limited - India
- San Jose City I Power Corp, Philippines
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- Dalmia Cement Bharat India
- Planning Commission, India
- Power Finance Corporation Ltd., India
- Bayan Resources Tbk. - Indonesia
- Carbofer General Trading SA - India
- The University of Queensland
- Semirara Mining Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wilmar Investment Holdings
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement - Thailand
- Therma Luzon, Inc, Philippines
- Aboitiz Power Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- IEA Clean Coal Centre - UK
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- Aditya Birla Group - India
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Coalindo Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Gujarat Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Baramulti Group, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Parry Sugars Refinery, India
- Port Waratah Coal Services - Australia
- Indogreen Group - Indonesia
- Attock Cement Pakistan Limited
- ICICI Bank Limited - India
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- Makarim & Taira - Indonesia
- Straits Asia Resources Limited - Singapore
- Bhatia International Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- IHS Mccloskey Coal Group - USA
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Orica Australia Pty. Ltd.
- White Energy Company Limited
- Essar Steel Hazira Ltd - India
- Mintek Dendrill Indonesia
- International Coal Ventures Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Africa Commodities Group - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Sojitz Corporation - Japan
- Electricity Generating Authority of Thailand
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- Ministry of Transport, Egypt
- Toyota Tsusho Corporation, Japan
- Medco Energi Mining Internasional
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bharathi Cement Corporation - India
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Eastern Coal Council - USA
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Larsen & Toubro Limited - India
- Tata Chemicals Ltd - India
- Ceylon Electricity Board - Sri Lanka
- GN Power Mariveles Coal Plant, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercuria Energy - Indonesia
- Indian Energy Exchange, India
- Tamil Nadu electricity Board
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