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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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Monday, 04 November 19
COAL INDIA'S OCTOBER PRODUCTION MAY FALL 20% - PTI
Coal India’s production in October is likely to be 19-20 per cent lower at about 40 million tonne, as compared to 49.77 million tonne produce ...
Monday, 04 November 19
PANAMAX: WEAKER SENTIMENTS CONTINUED FROM LAST WEEK, WITH RATES FURTHER SOFTENING IN BOTH BASINS - BALTIC BRIEFING
Capesize
The Capesize market meandered slightly upwards this week before giving back much of its gains mid-week. Opening the week at $24,945, t ...
Thursday, 31 October 19
U.S. COAL-FIRED POWER PLANTS SCHEDULED TO SHUT - REUTERS
U.S. power companies expect to retire or convert from coal to gas over 13,800 megawatts (MW) of coal-fired plants in 2019 after shutting over 13,30 ...
Thursday, 31 October 19
SE ASIA MAY BECOME NET FOSSIL FUEL IMPORTER IN COMING YEARS - IEA
Southeast Asia is set to become a key driver of world energy trends over the next 20 years as its energy demand grows at twice the global average, ...
Monday, 28 October 19
ULTRAMAX: ASIA RATES REMAINED UNDER PRESSURE WITH THE NORTH LACKING FRESH ENQUIRY - BALTIC BRIEFING
Capesize
The end of the week brought about a small increase in sentiment heading into a long weekend for some regions. After sustaining a drop ...
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Showing 1296 to 1300 news of total 6871 |
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- Aboitiz Power Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- PNOC Exploration Corporation - Philippines
- Indogreen Group - Indonesia
- Samtan Co., Ltd - South Korea
- Barasentosa Lestari - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Kideco Jaya Agung - Indonesia
- Independent Power Producers Association of India
- Bhoruka Overseas - Indonesia
- Malabar Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jaiprakash Power Ventures ltd
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- International Coal Ventures Pvt Ltd - India
- Ambuja Cements Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- McConnell Dowell - Australia
- Leighton Contractors Pty Ltd - Australia
- GMR Energy Limited - India
- Cigading International Bulk Terminal - Indonesia
- Orica Mining Services - Indonesia
- Australian Coal Association
- Bangladesh Power Developement Board
- Vizag Seaport Private Limited - India
- Kobexindo Tractors - Indoneisa
- Gujarat Sidhee Cement - India
- Karaikal Port Pvt Ltd - India
- Larsen & Toubro Limited - India
- CNBM International Corporation - China
- VISA Power Limited - India
- Port Waratah Coal Services - Australia
- Indonesian Coal Mining Association
- Therma Luzon, Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- IEA Clean Coal Centre - UK
- Agrawal Coal Company - India
- Siam City Cement PLC, Thailand
- SN Aboitiz Power Inc, Philippines
- Xindia Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- Riau Bara Harum - Indonesia
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Planning Commission, India
- Bulk Trading Sa - Switzerland
- Dalmia Cement Bharat India
- Electricity Authority, New Zealand
- Jindal Steel & Power Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Africa Commodities Group - South Africa
- Miang Besar Coal Terminal - Indonesia
- Georgia Ports Authority, United States
- Indo Tambangraya Megah - Indonesia
- Kumho Petrochemical, South Korea
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- European Bulk Services B.V. - Netherlands
- Lanco Infratech Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Wilmar Investment Holdings
- Intertek Mineral Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- The University of Queensland
- Mintek Dendrill Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Rashtriya Ispat Nigam Limited - India
- Thiess Contractors Indonesia
- Maharashtra Electricity Regulatory Commission - India
- PTC India Limited - India
- Parliament of New Zealand
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Parry Sugars Refinery, India
- GAC Shipping (India) Pvt Ltd
- Global Green Power PLC Corporation, Philippines
- Orica Australia Pty. Ltd.
- Marubeni Corporation - India
- Edison Trading Spa - Italy
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Romanian Commodities Exchange
- Kepco SPC Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Meralco Power Generation, Philippines
- Renaissance Capital - South Africa
- Antam Resourcindo - Indonesia
- Oldendorff Carriers - Singapore
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- San Jose City I Power Corp, Philippines
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- Asmin Koalindo Tuhup - Indonesia
- IHS Mccloskey Coal Group - USA
- Indian Energy Exchange, India
- Interocean Group of Companies - India
- Posco Energy - South Korea
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- Videocon Industries ltd - India
- Semirara Mining Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Medco Energi Mining Internasional
- Goldman Sachs - Singapore
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- Electricity Generating Authority of Thailand
- Semirara Mining and Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Vijayanagar Sugar Pvt Ltd - India
- GVK Power & Infra Limited - India
- AsiaOL BioFuels Corp., Philippines
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- CIMB Investment Bank - Malaysia
- Coal and Oil Company - UAE
- Sical Logistics Limited - India
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Australian Commodity Traders Exchange
- Eastern Energy - Thailand
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Globalindo Alam Lestari - Indonesia
- Merrill Lynch Commodities Europe
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Borneo Indobara - Indonesia
- ASAPP Information Group - India
- Banpu Public Company Limited - Thailand
- New Zealand Coal & Carbon
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Rio Tinto Coal - Australia
- Thai Mozambique Logistica
- Bukit Makmur.PT - Indonesia
- Energy Development Corp, Philippines
- Mercuria Energy - Indonesia
- Makarim & Taira - Indonesia
- Star Paper Mills Limited - India
- Price Waterhouse Coopers - Russia
- Gujarat Mineral Development Corp Ltd - India
- Cement Manufacturers Association - India
- Latin American Coal - Colombia
- Economic Council, Georgia
- Madhucon Powers Ltd - India
- Simpson Spence & Young - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Aditya Birla Group - India
- Global Business Power Corporation, Philippines
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Heidelberg Cement - Germany
- Mjunction Services Limited - India
- Coalindo Energy - Indonesia
- Uttam Galva Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Ministry of Transport, Egypt
- Salva Resources Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Deloitte Consulting - India
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Grasim Industreis Ltd - India
- Kaltim Prima Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Wood Mackenzie - Singapore
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Iligan Light & Power Inc, Philippines
- The State Trading Corporation of India Ltd
- Tamil Nadu electricity Board
- Sinarmas Energy and Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
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