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