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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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Sunday, 29 December 19
AUSTRALIA SUFFERS WORST OF CHINA'S COAL CURBS AFTER EARLIER BOOM - BLOOMBERG
Australia is bearing the brunt of China’s year-end coal import restrictions, ceding market share to other exporters including Russia and Mong ...
Saturday, 28 December 19
SUPRAMAX: A 63,000DWT VESSEL, OPEN CIGADING, FIXED A TRIP VIA INDONESIA, REDELIVERY WEST COAST INDIA, AT $8,500 - BALTIC BRIEFING
Capesize
The Capesize market this past week has been attempting to recalibrate itself in consideration of weakening freight levels and increasing ...
Saturday, 28 December 19
CHINESE INDUSTRIAL CITY TO FURTHER CUT COAL CONSUMPTION - XINHUA
Harbin, capital city of Heilongjiang Province in China’s northeastern industrial heartland, is planning to further reduce its coal consumptio ...
Friday, 27 December 19
MISERY LOOMS OVER TOP COAL SHIPPERS AS CHINA TO BUY LESS IN 2020 BLOOMBERG
China isn’t cutting back on consumption of the most-polluting fossil fuel just yet, but it is set to reduce imports.
The world ...
Thursday, 26 December 19
REVIEW OF 2019 AND OUTLOOK FOR 2020 - OPEC
Global economic growth slowed in 2019, impacted by a variety of challenges. Trade issues not only led to reduction in global final consumption but ...
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Showing 1221 to 1225 news of total 6871 |
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- PTC India Limited - India
- Agrawal Coal Company - India
- Wood Mackenzie - Singapore
- Salva Resources Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Globalindo Alam Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- Meralco Power Generation, Philippines
- Ministry of Finance - Indonesia
- Kideco Jaya Agung - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- Goldman Sachs - Singapore
- Chettinad Cement Corporation Ltd - India
- Iligan Light & Power Inc, Philippines
- Minerals Council of Australia
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Krishnapatnam Port Company Ltd. - India
- Thai Mozambique Logistica
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Kohat Cement Company Ltd. - Pakistan
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Ministry of Transport, Egypt
- Vijayanagar Sugar Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Barasentosa Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Cement Manufacturers Association - India
- Energy Link Ltd, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- Bhushan Steel Limited - India
- Grasim Industreis Ltd - India
- Bulk Trading Sa - Switzerland
- International Coal Ventures Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Wilmar Investment Holdings
- Baramulti Group, Indonesia
- Bukit Makmur.PT - Indonesia
- London Commodity Brokers - England
- San Jose City I Power Corp, Philippines
- GMR Energy Limited - India
- Ceylon Electricity Board - Sri Lanka
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- McConnell Dowell - Australia
- Economic Council, Georgia
- Larsen & Toubro Limited - India
- Planning Commission, India
- Global Coal Blending Company Limited - Australia
- Vizag Seaport Private Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Sindya Power Generating Company Private Ltd
- Asmin Koalindo Tuhup - Indonesia
- Bharathi Cement Corporation - India
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Neyveli Lignite Corporation Ltd, - India
- OPG Power Generation Pvt Ltd - India
- VISA Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- Latin American Coal - Colombia
- Indogreen Group - Indonesia
- Star Paper Mills Limited - India
- PetroVietnam Power Coal Import and Supply Company
- AsiaOL BioFuels Corp., Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Medco Energi Mining Internasional
- Anglo American - United Kingdom
- Petron Corporation, Philippines
- Attock Cement Pakistan Limited
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Energy Development Corp, Philippines
- Orica Australia Pty. Ltd.
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Orica Mining Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Xindia Steels Limited - India
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Videocon Industries ltd - India
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- Madhucon Powers Ltd - India
- Africa Commodities Group - South Africa
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- Indian Oil Corporation Limited
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Global Business Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- The Treasury - Australian Government
- CIMB Investment Bank - Malaysia
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Global Green Power PLC Corporation, Philippines
- Indonesian Coal Mining Association
- Banpu Public Company Limited - Thailand
- GVK Power & Infra Limited - India
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Georgia Ports Authority, United States
- Essar Steel Hazira Ltd - India
- Semirara Mining Corp, Philippines
- Electricity Authority, New Zealand
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- Pendopo Energi Batubara - Indonesia
- Aditya Birla Group - India
- ASAPP Information Group - India
- Riau Bara Harum - Indonesia
- MS Steel International - UAE
- New Zealand Coal & Carbon
- IEA Clean Coal Centre - UK
- Karaikal Port Pvt Ltd - India
- White Energy Company Limited
- Eastern Energy - Thailand
- Eastern Coal Council - USA
- Coal and Oil Company - UAE
- Indika Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Bhatia International Limited - India
- Indo Tambangraya Megah - Indonesia
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- Jaiprakash Power Ventures ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Parliament of New Zealand
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Interocean Group of Companies - India
- Kaltim Prima Coal - Indonesia
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Altura Mining Limited, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Independent Power Producers Association of India
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Holcim Trading Pte Ltd - Singapore
- Ambuja Cements Ltd - India
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