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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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Tuesday, 05 June 18
SOUTH KOREA'S SULPHUR CAP ALTERS ASIAN COAL MARKET DYNAMICS: RUSSELL
South Korea’s imposition of a strict sulphur cap on its imported coal is likely to cause ripples across Asia’s markets for the pollutin ...
Tuesday, 05 June 18
THINGS STILL LOOK TO BE PROMISING FOR THE DRY BULK MARKET OVER THE NEXT COUPLE OF MONTHS - GEORGE LAZARIDIS
Just as we thought the world was calming back down to reason, worries and frictions regarding global trade resurfaced this past week after a series ...
Tuesday, 05 June 18
INDONESIAN COAL PRICE REFERENCE IS GOING UP AGAIN
COALspot.com: According to latest ministerial decree No. 1857 K/30/MEM/2018 dated 4 June 2018, the Indonesian Coal Price Reference (HBA) up 7.91 pe ...
Saturday, 02 June 18
HOW CARBON UTILISATION WILL BE A KEY STEP IN INDIA'S CLIMATE STRATEGY - BENJAMIN SPORTON
For India, energy remains the key driver of growth, not only from an economic perspective but more importantly for accelerating social development. ...
Thursday, 31 May 18
SUPRAMAX: INDO/CHINA COAL RV IS GETTING FIXED AROUND $13K DELIVERY SINGAPORE - FEARNLEYS
Capesize
The Cape market has been on a downward trend for the past week.
According to Fearnleys, Oslo based broker, Brazil market ...
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Showing 1706 to 1710 news of total 6871 |
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- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Karaikal Port Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Wilmar Investment Holdings
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Iligan Light & Power Inc, Philippines
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Oldendorff Carriers - Singapore
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- Gujarat Sidhee Cement - India
- Ind-Barath Power Infra Limited - India
- Videocon Industries ltd - India
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- Tata Chemicals Ltd - India
- Kideco Jaya Agung - Indonesia
- Siam City Cement - Thailand
- Globalindo Alam Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- ASAPP Information Group - India
- International Coal Ventures Pvt Ltd - India
- Posco Energy - South Korea
- Tamil Nadu electricity Board
- CIMB Investment Bank - Malaysia
- Samtan Co., Ltd - South Korea
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- London Commodity Brokers - England
- Banpu Public Company Limited - Thailand
- PTC India Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Orica Mining Services - Indonesia
- Makarim & Taira - Indonesia
- Toyota Tsusho Corporation, Japan
- Medco Energi Mining Internasional
- Mercator Lines Limited - India
- Manunggal Multi Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Indian Energy Exchange, India
- Indonesian Coal Mining Association
- Indika Energy - Indonesia
- Intertek Mineral Services - Indonesia
- White Energy Company Limited
- Maharashtra Electricity Regulatory Commission - India
- Parliament of New Zealand
- Bukit Baiduri Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Transport, Egypt
- Edison Trading Spa - Italy
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- Vedanta Resources Plc - India
- Jaiprakash Power Ventures ltd
- Sojitz Corporation - Japan
- Global Business Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aditya Birla Group - India
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- Sical Logistics Limited - India
- Carbofer General Trading SA - India
- VISA Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Trasteel International SA, Italy
- Latin American Coal - Colombia
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Bangladesh Power Developement Board
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Pipit Mutiara Jaya. PT, Indonesia
- Formosa Plastics Group - Taiwan
- Sarangani Energy Corporation, Philippines
- San Jose City I Power Corp, Philippines
- South Luzon Thermal Energy Corporation
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- Siam City Cement PLC, Thailand
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Bhushan Steel Limited - India
- Kepco SPC Power Corporation, Philippines
- ICICI Bank Limited - India
- Interocean Group of Companies - India
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Singapore Mercantile Exchange
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- PetroVietnam Power Coal Import and Supply Company
- Eastern Energy - Thailand
- Star Paper Mills Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Kobexindo Tractors - Indoneisa
- Orica Australia Pty. Ltd.
- Simpson Spence & Young - Indonesia
- Mintek Dendrill Indonesia
- Baramulti Group, Indonesia
- Minerals Council of Australia
- Merrill Lynch Commodities Europe
- SMC Global Power, Philippines
- Ceylon Electricity Board - Sri Lanka
- Directorate Of Revenue Intelligence - India
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- Billiton Holdings Pty Ltd - Australia
- IHS Mccloskey Coal Group - USA
- Holcim Trading Pte Ltd - Singapore
- Sree Jayajothi Cements Limited - India
- Vizag Seaport Private Limited - India
- The University of Queensland
- Thai Mozambique Logistica
- CNBM International Corporation - China
- Lanco Infratech Ltd - India
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- Global Green Power PLC Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- McConnell Dowell - Australia
- Jindal Steel & Power Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Goldman Sachs - Singapore
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Power Finance Corporation Ltd., India
- Electricity Generating Authority of Thailand
- Barasentosa Lestari - Indonesia
- Coalindo Energy - Indonesia
- Altura Mining Limited, Indonesia
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- Bulk Trading Sa - Switzerland
- PowerSource Philippines DevCo
- Commonwealth Bank - Australia
- Georgia Ports Authority, United States
- Pendopo Energi Batubara - Indonesia
- Central Java Power - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Borneo Indobara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Planning Commission, India
- GMR Energy Limited - India
- Uttam Galva Steels Limited - India
- Bhoruka Overseas - Indonesia
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Australian Commodity Traders Exchange
- Bharathi Cement Corporation - India
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- Binh Thuan Hamico - Vietnam
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Cement Manufacturers Association - India
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Savvy Resources Ltd - HongKong
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