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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, 02 December 22
INDONESIAN COAL PRICE REFERENCE PLUNGE TOWARD US$ 281.48 A TON AS DEMAND DROPS WORLDWIDE
COALspot.com: The cost of coal is falling so fast that it is beginning to put real money back in the pockets of end-users.
Indonesia ...
Wednesday, 30 November 22
INDONESIA’S BUMI RESOURCES TARGETS 2023 COAL OUTPUT OF 80 MLN TONNES - REUTERS
Indonesian coal miner PT Bumi Resources Tbk BUMI.JKis eyeing a 10% increase in output to 80 million tonnes next year amid expectations for more fav ...
Wednesday, 30 November 22
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Tuesday, 29 November 22
INDIA TO RECEIVE FIRST LNG CARGO FROM INDONESIA’S TANGGUH LNG - REUTERS
India will receive its first cargo from Indonesia’s Tangguh liquefied natural gas (LNG) plant at the Dahej terminal on Monday, according to a ...
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- Bharathi Cement Corporation - India
- VISA Power Limited - India
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Rio Tinto Coal - Australia
- Salva Resources Pvt Ltd - India
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Sindya Power Generating Company Private Ltd
- Coalindo Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Ministry of Mines - Canada
- Directorate Of Revenue Intelligence - India
- Bukit Baiduri Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- Bukit Makmur.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- Merrill Lynch Commodities Europe
- Larsen & Toubro Limited - India
- Australian Coal Association
- Bangladesh Power Developement Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wood Mackenzie - Singapore
- Alfred C Toepfer International GmbH - Germany
- South Luzon Thermal Energy Corporation
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Global Green Power PLC Corporation, Philippines
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Cement Manufacturers Association - India
- Parliament of New Zealand
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- Meenaskhi Energy Private Limited - India
- Maheswari Brothers Coal Limited - India
- McConnell Dowell - Australia
- Renaissance Capital - South Africa
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Mjunction Services Limited - India
- The State Trading Corporation of India Ltd
- Sojitz Corporation - Japan
- Altura Mining Limited, Indonesia
- Grasim Industreis Ltd - India
- Agrawal Coal Company - India
- Eastern Coal Council - USA
- Anglo American - United Kingdom
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- Orica Mining Services - Indonesia
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- Ceylon Electricity Board - Sri Lanka
- Miang Besar Coal Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Tamil Nadu electricity Board
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- Central Java Power - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- Global Business Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Essar Steel Hazira Ltd - India
- Economic Council, Georgia
- Planning Commission, India
- European Bulk Services B.V. - Netherlands
- Krishnapatnam Port Company Ltd. - India
- Central Electricity Authority - India
- PetroVietnam Power Coal Import and Supply Company
- Kohat Cement Company Ltd. - Pakistan
- Attock Cement Pakistan Limited
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- PTC India Limited - India
- GMR Energy Limited - India
- Posco Energy - South Korea
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Mercuria Energy - Indonesia
- Uttam Galva Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- Minerals Council of Australia
- Malabar Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- The University of Queensland
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Banpu Public Company Limited - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Xindia Steels Limited - India
- Commonwealth Bank - Australia
- San Jose City I Power Corp, Philippines
- Thai Mozambique Logistica
- Port Waratah Coal Services - Australia
- SMG Consultants - Indonesia
- Dalmia Cement Bharat India
- India Bulls Power Limited - India
- Ministry of Finance - Indonesia
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Bhatia International Limited - India
- SMC Global Power, Philippines
- Kumho Petrochemical, South Korea
- Gujarat Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- Thiess Contractors Indonesia
- LBH Netherlands Bv - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Therma Luzon, Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Chamber of Mines of South Africa
- Mintek Dendrill Indonesia
- Savvy Resources Ltd - HongKong
- CIMB Investment Bank - Malaysia
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- Vedanta Resources Plc - India
- AsiaOL BioFuels Corp., Philippines
- Trasteel International SA, Italy
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Tata Chemicals Ltd - India
- Energy Development Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Binh Thuan Hamico - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- Madhucon Powers Ltd - India
- Bulk Trading Sa - Switzerland
- Energy Link Ltd, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Pendopo Energi Batubara - Indonesia
- Indian Oil Corporation Limited
- Jindal Steel & Power Ltd - India
- Formosa Plastics Group - Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Star Paper Mills Limited - India
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Singapore Mercantile Exchange
- Baramulti Group, Indonesia
- Petron Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement - Thailand
- Heidelberg Cement - Germany
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Metalloyd Limited - United Kingdom
- TeaM Sual Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Semirara Mining Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Authority, New Zealand
- Billiton Holdings Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Interocean Group of Companies - India
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- Coal and Oil Company - UAE
- Indika Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Indian Energy Exchange, India
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
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