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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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Friday, 05 January 18
COAL DEMAND TO REMAIN FLAT TO 2022, RESULTING IN A DECADE OF STAGNATION - IEA
Global demand for coal should remain nearly flat between 2017 and 2022, resulting in a decade of stagnation for coal consumption, according to the ...
Thursday, 04 January 18
SUPRAMAX: INDO TO CHINA WERE FIXED AT AROUND $8K DAILY; DOWN AROUND 27% WOW
Supramax
Q1 kicked off with an usual standby with all counterparts waiting for the market to take direction. Further holidays in East-Europe adde ...
Wednesday, 03 January 18
KOMIPO TO BUY 130K TONS OF MIN. 5700 NAR COAL FOR FEB 2018 LOADING
COALspot.com: South Korea state-owned utility Korea Midland Power (KOMIPO) issued a tender for 130k Metric Tons of min. 5700 NAR coal to be burnt a ...
Friday, 29 December 17
PORT OF NEWCASTLE SHIPPED A$ 1.527 BILLION WORTH OF 12.65 MT OF COAL IN NOVEMBER
COALspot.com: The Port of Newcastle, Australia’s major trading ports, and the world’s largest coal export port has shipped $AU 1527.6 M ...
Friday, 29 December 17
U.S WEEKLY COAL PRODUCTION SLIGHTLY UP FOR THE WEEK ENDING 23 DEC, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totaled an estimated 15.5 million short tons ...
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Showing 1836 to 1840 news of total 6871 |
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- Port Waratah Coal Services - Australia
- Maharashtra Electricity Regulatory Commission - India
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Kepco SPC Power Corporation, Philippines
- Agrawal Coal Company - India
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- Ambuja Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Orica Australia Pty. Ltd.
- Dalmia Cement Bharat India
- Metalloyd Limited - United Kingdom
- Merrill Lynch Commodities Europe
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Power Finance Corporation Ltd., India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Samtan Co., Ltd - South Korea
- Sree Jayajothi Cements Limited - India
- The State Trading Corporation of India Ltd
- Siam City Cement PLC, Thailand
- Indonesian Coal Mining Association
- Kobexindo Tractors - Indoneisa
- Xindia Steels Limited - India
- Baramulti Group, Indonesia
- PTC India Limited - India
- Global Coal Blending Company Limited - Australia
- Aditya Birla Group - India
- Global Business Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- Australian Commodity Traders Exchange
- MS Steel International - UAE
- CNBM International Corporation - China
- Malabar Cements Ltd - India
- New Zealand Coal & Carbon
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Economic Council, Georgia
- Karaikal Port Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- Sojitz Corporation - Japan
- SN Aboitiz Power Inc, Philippines
- SMG Consultants - Indonesia
- Bayan Resources Tbk. - Indonesia
- Price Waterhouse Coopers - Russia
- Maheswari Brothers Coal Limited - India
- South Luzon Thermal Energy Corporation
- Indo Tambangraya Megah - Indonesia
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Mjunction Services Limited - India
- Sinarmas Energy and Mining - Indonesia
- London Commodity Brokers - England
- Savvy Resources Ltd - HongKong
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- IEA Clean Coal Centre - UK
- Jorong Barutama Greston.PT - Indonesia
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- Simpson Spence & Young - Indonesia
- Ministry of Finance - Indonesia
- Indian Oil Corporation Limited
- Sarangani Energy Corporation, Philippines
- Deloitte Consulting - India
- International Coal Ventures Pvt Ltd - India
- Larsen & Toubro Limited - India
- Holcim Trading Pte Ltd - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Leighton Contractors Pty Ltd - Australia
- Straits Asia Resources Limited - Singapore
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- OPG Power Generation Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Coalindo Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Posco Energy - South Korea
- Antam Resourcindo - Indonesia
- Bhushan Steel Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Bhoruka Overseas - Indonesia
- Standard Chartered Bank - UAE
- Sical Logistics Limited - India
- Gujarat Sidhee Cement - India
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- Central Java Power - Indonesia
- The University of Queensland
- Bukit Baiduri Energy - Indonesia
- Attock Cement Pakistan Limited
- Iligan Light & Power Inc, Philippines
- Bharathi Cement Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kohat Cement Company Ltd. - Pakistan
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Carbofer General Trading SA - India
- McConnell Dowell - Australia
- GVK Power & Infra Limited - India
- Australian Coal Association
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercator Lines Limited - India
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Singapore Mercantile Exchange
- Global Green Power PLC Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Makarim & Taira - Indonesia
- Bhatia International Limited - India
- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Latin American Coal - Colombia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Miang Besar Coal Terminal - Indonesia
- Thai Mozambique Logistica
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- Jaiprakash Power Ventures ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Altura Mining Limited, Indonesia
- Coastal Gujarat Power Limited - India
- San Jose City I Power Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- AsiaOL BioFuels Corp., Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- ASAPP Information Group - India
- Goldman Sachs - Singapore
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Formosa Plastics Group - Taiwan
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- Georgia Ports Authority, United States
- Kartika Selabumi Mining - Indonesia
- Toyota Tsusho Corporation, Japan
- Indogreen Group - Indonesia
- Wood Mackenzie - Singapore
- Eastern Coal Council - USA
- Banpu Public Company Limited - Thailand
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Meenaskhi Energy Private Limited - India
- Bulk Trading Sa - Switzerland
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- Edison Trading Spa - Italy
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- India Bulls Power Limited - India
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Binh Thuan Hamico - Vietnam
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- ICICI Bank Limited - India
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Karbindo Abesyapradhi - Indoneisa
- LBH Netherlands Bv - Netherlands
- Marubeni Corporation - India
- Commonwealth Bank - Australia
- PowerSource Philippines DevCo
- Manunggal Multi Energi - Indonesia
- Cement Manufacturers Association - India
- Coal and Oil Company - UAE
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
- European Bulk Services B.V. - Netherlands
- PNOC Exploration Corporation - Philippines
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Parliament of New Zealand
- Mercuria Energy - Indonesia
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- Indika Energy - Indonesia
- White Energy Company Limited
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