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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, 01 October 18
A NO-DEAL BREXIT WILL UNDOUBTEDLY HAVE CONSEQUENCES FOR IMPORTERS AND EXPORTERS - KATE JONES, THE BALTIC BRIEFING
If you live in the UK, you might be finding it difficult to get away from the Brexit debate. “Hard Brexit”, “soft Brexit”, ...
Friday, 28 September 18
INDONESIA 2018 COAL OUTPUT TARGET NOW AROUND 507 MLN T - ENERGY MINISTRY : REUTERS
Indonesia has increased its 2018 coal production target to around 507 million tonnes from a previous target of 485 million tonnes, the Energy Minis ...
Friday, 28 September 18
FITCH RATINGS: METALLURGICAL COAL MINERS MAY CURB COSTS AS PRICES SLIP
Strong cost inflation in the global metallurgical coal sector suggests that miners may focus on cost controls as prices decline from their current ...
Wednesday, 26 September 18
IS YOUR CHARTER PARTY READY FOR 2020? - METTE KRONHOLM FRAENDE, BIMCO
As the deadline for the IMO’s global low-sulphur fuel requirements fast approaches, it is necessary to carefully check the bunker clauses in ...
Wednesday, 26 September 18
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
Despite the fact that the dry bulk SnP market saw an admittedly busy summer season, there is a noticeable slowdown in activity during the past thre ...
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Showing 1606 to 1610 news of total 6871 |
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- LBH Netherlands Bv - Netherlands
- Ind-Barath Power Infra Limited - India
- San Jose City I Power Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Indogreen Group - Indonesia
- Kaltim Prima Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Altura Mining Limited, Indonesia
- Formosa Plastics Group - Taiwan
- PTC India Limited - India
- Vedanta Resources Plc - India
- Economic Council, Georgia
- Parliament of New Zealand
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- IEA Clean Coal Centre - UK
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- CNBM International Corporation - China
- Planning Commission, India
- Maharashtra Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- Larsen & Toubro Limited - India
- Sinarmas Energy and Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The University of Queensland
- Bukit Baiduri Energy - Indonesia
- Tata Chemicals Ltd - India
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Kartika Selabumi Mining - Indonesia
- Lanco Infratech Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- Minerals Council of Australia
- Kumho Petrochemical, South Korea
- Karaikal Port Pvt Ltd - India
- Goldman Sachs - Singapore
- MS Steel International - UAE
- Meralco Power Generation, Philippines
- Central Electricity Authority - India
- PetroVietnam Power Coal Import and Supply Company
- Edison Trading Spa - Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Bharathi Cement Corporation - India
- Videocon Industries ltd - India
- Bangladesh Power Developement Board
- White Energy Company Limited
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- Sindya Power Generating Company Private Ltd
- Singapore Mercantile Exchange
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Electricity Authority, New Zealand
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Central Java Power - Indonesia
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- Star Paper Mills Limited - India
- Madhucon Powers Ltd - India
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- Therma Luzon, Inc, Philippines
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- Australian Coal Association
- Latin American Coal - Colombia
- IHS Mccloskey Coal Group - USA
- Jaiprakash Power Ventures ltd
- Globalindo Alam Lestari - Indonesia
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Jindal Steel & Power Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Posco Energy - South Korea
- Romanian Commodities Exchange
- Aditya Birla Group - India
- Mercator Lines Limited - India
- SMC Global Power, Philippines
- Mintek Dendrill Indonesia
- GMR Energy Limited - India
- Eastern Energy - Thailand
- Meenaskhi Energy Private Limited - India
- Baramulti Group, Indonesia
- Essar Steel Hazira Ltd - India
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Global Business Power Corporation, Philippines
- McConnell Dowell - Australia
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Interocean Group of Companies - India
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- SN Aboitiz Power Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Chettinad Cement Corporation Ltd - India
- Ministry of Finance - Indonesia
- Leighton Contractors Pty Ltd - Australia
- ASAPP Information Group - India
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- South Luzon Thermal Energy Corporation
- Metalloyd Limited - United Kingdom
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- Bhatia International Limited - India
- Bukit Makmur.PT - Indonesia
- Chamber of Mines of South Africa
- Ministry of Mines - Canada
- Banpu Public Company Limited - Thailand
- India Bulls Power Limited - India
- Simpson Spence & Young - Indonesia
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Coal and Oil Company - UAE
- Barasentosa Lestari - Indonesia
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- Deloitte Consulting - India
- Gujarat Sidhee Cement - India
- GN Power Mariveles Coal Plant, Philippines
- Merrill Lynch Commodities Europe
- Thai Mozambique Logistica
- The Treasury - Australian Government
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Offshore Bulk Terminal Pte Ltd, Singapore
- Trasteel International SA, Italy
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
- Malabar Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Tamil Nadu electricity Board
- Petrochimia International Co. Ltd.- Taiwan
- Kapuas Tunggal Persada - Indonesia
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Indian Energy Exchange, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Anglo American - United Kingdom
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Makarim & Taira - Indonesia
- Electricity Generating Authority of Thailand
- Maheswari Brothers Coal Limited - India
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Energy Link Ltd, New Zealand
- Medco Energi Mining Internasional
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- European Bulk Services B.V. - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Standard Chartered Bank - UAE
- Ceylon Electricity Board - Sri Lanka
- Wilmar Investment Holdings
- Miang Besar Coal Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Holcim Trading Pte Ltd - Singapore
- SMG Consultants - Indonesia
- Gujarat Mineral Development Corp Ltd - India
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