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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, 26 April 18
COAL PRICES ARE EXPECTED TO AVERAGE $85/MT IN 2018, DOWN SLIGHTLY FROM 2017 - WORLD BANK
Coal prices rose 4 percent in the first quarter (q/q), following a surge of 34 percent in 2017, mainly due to strong consumption in China spurred b ...
Wednesday, 25 April 18
TANKER MARKET INSIGHT - THEODOROS NTALAKOS
We had the opportunity to be part of Intertanko's Hellenic Mediterranean Panel last week in the SNFCC and to present an outlook on the tanker f ...
Tuesday, 24 April 18
IMPORTING INDONESIAN COAL MAKES SENSE FOR INDIAN COASTAL PLANTS EVEN WHEN IT IS COSTLIER THAN INDIAN - ECONOMIC TIMES
Rising Indonesian coal production and lower Chinese demand have pulled down Indonesian coal prices by 22% over the last 45 days, a trend that augur ...
Tuesday, 24 April 18
IMO AIMS TO HALVE GLOBAL SHIPPING EMISSIONS - BUT WHAT WILL IT COST? - WOOD MACKENZIE
Global bunker fuel costs could rise by up to US$60 billion annually from 2020, in a full compliance scenario, when the International Maritim ...
Tuesday, 24 April 18
TWO 56K-DWT OPEN HONG KONG AND SINGAPORE WERE FIXED FOR INDONESIA COAL TRIPS TO CHINA, AT $9,500 AND $11,000 RESPECTIVELY - BALTIC BRIEFING
Capesize
This week has seen the Cape 5 timecharter weighted average almost double. Similarly, the Brazil to China ore rates climbed over $4.50, f ...
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Showing 1736 to 1740 news of total 6871 |
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- Dalmia Cement Bharat India
- Sinarmas Energy and Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Kumho Petrochemical, South Korea
- Bhushan Steel Limited - India
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Global Business Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Interocean Group of Companies - India
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Commonwealth Bank - Australia
- Essar Steel Hazira Ltd - India
- Carbofer General Trading SA - India
- Bahari Cakrawala Sebuku - Indonesia
- Iligan Light & Power Inc, Philippines
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- Siam City Cement - Thailand
- Economic Council, Georgia
- The State Trading Corporation of India Ltd
- Oldendorff Carriers - Singapore
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Orica Australia Pty. Ltd.
- Energy Development Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Latin American Coal - Colombia
- Gujarat Mineral Development Corp Ltd - India
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Karaikal Port Pvt Ltd - India
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Electricity Generating Authority of Thailand
- Toyota Tsusho Corporation, Japan
- Minerals Council of Australia
- Renaissance Capital - South Africa
- Jorong Barutama Greston.PT - Indonesia
- MS Steel International - UAE
- Parliament of New Zealand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Deloitte Consulting - India
- Energy Link Ltd, New Zealand
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Madhucon Powers Ltd - India
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Kobexindo Tractors - Indoneisa
- Singapore Mercantile Exchange
- Rio Tinto Coal - Australia
- European Bulk Services B.V. - Netherlands
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Sakthi Sugars Limited - India
- Vizag Seaport Private Limited - India
- Meralco Power Generation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Trasteel International SA, Italy
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Planning Commission, India
- Coalindo Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Kaltim Prima Coal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- Marubeni Corporation - India
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Wood Mackenzie - Singapore
- Bukit Makmur.PT - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Ministry of Finance - Indonesia
- IEA Clean Coal Centre - UK
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
- Mjunction Services Limited - India
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- GVK Power & Infra Limited - India
- White Energy Company Limited
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- PTC India Limited - India
- Australian Coal Association
- Port Waratah Coal Services - Australia
- Samtan Co., Ltd - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- Altura Mining Limited, Indonesia
- Bangladesh Power Developement Board
- Alfred C Toepfer International GmbH - Germany
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Global Green Power PLC Corporation, Philippines
- Baramulti Group, Indonesia
- Bharathi Cement Corporation - India
- Videocon Industries ltd - India
- SMG Consultants - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- India Bulls Power Limited - India
- ICICI Bank Limited - India
- ASAPP Information Group - India
- IHS Mccloskey Coal Group - USA
- Jindal Steel & Power Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Salva Resources Pvt Ltd - India
- Africa Commodities Group - South Africa
- Indika Energy - Indonesia
- GMR Energy Limited - India
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Eastern Coal Council - USA
- Coal and Oil Company - UAE
- Grasim Industreis Ltd - India
- Star Paper Mills Limited - India
- Ambuja Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Ind-Barath Power Infra Limited - India
- New Zealand Coal & Carbon
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
- Borneo Indobara - Indonesia
- Heidelberg Cement - Germany
- The University of Queensland
- Therma Luzon, Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Electricity Authority, New Zealand
- Intertek Mineral Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coastal Gujarat Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- McConnell Dowell - Australia
- Global Coal Blending Company Limited - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhatia International Limited - India
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- CIMB Investment Bank - Malaysia
- Australian Commodity Traders Exchange
- Independent Power Producers Association of India
- Siam City Cement PLC, Thailand
- Aditya Birla Group - India
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Billiton Holdings Pty Ltd - Australia
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- Gujarat Sidhee Cement - India
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Gujarat Electricity Regulatory Commission - India
- Ministry of Mines - Canada
- Petrochimia International Co. Ltd.- Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Standard Chartered Bank - UAE
- Orica Mining Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Sojitz Corporation - Japan
- Posco Energy - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Kepco SPC Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Tamil Nadu electricity Board
- Asmin Koalindo Tuhup - Indonesia
- Indonesian Coal Mining Association
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