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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, 21 December 17
FUEL SHORTAGE TRIGGERS JUMP IN COAL PRICES - CHINA DAILY
China’s thermal coal prices jumped recently as natural gas shortages across the north spurred an unexpected resurgence in demand for coal-fir ...
Thursday, 21 December 17
SUPRAMAX: IN THE MOST CHANCE, DO NOT EXPECT ANY DRAMATIC CHANGES IN THE NEAR FUTURE - FEARNLEYS
Supramax
Market reducing speed. Rates are dropping further for supras outbound USG on fronth, bkhaul is more stable i.e $25k/22k respectively say ...
Wednesday, 20 December 17
INDONESIAN HBA FELL FOR THE FIRST TIME IN SIX MONTHS, GOVERNMENT DATA SHOWS
COALspot.com: HBA fell 0.80 per cent in December, marking the first fall for the Indonesian Coal Price Reference ( HBA) since June 2017, the latest ...
Monday, 18 December 17
U.S. COAL EXPORTS FOR THE FIRST THREE QUARTERS OF 2017 WERE 69 MMST; UP 68% M/M - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.5 million sho ...
Thursday, 14 December 17
SUPRAMAX: INDO COAL TO CHINA AROUND LOW $10K DELIVERY SINGAPORE
Supramax
Atlantic basin kept its firm pace with charters still busy with covering pre-holiday requirements. Ultras got close to $20k for ordinary ...
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Showing 1846 to 1850 news of total 6871 |
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- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Baramulti Group, Indonesia
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- White Energy Company Limited
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- Timah Investasi Mineral - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- IEA Clean Coal Centre - UK
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chamber of Mines of South Africa
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- Dalmia Cement Bharat India
- Mercator Lines Limited - India
- Electricity Generating Authority of Thailand
- Port Waratah Coal Services - Australia
- Sindya Power Generating Company Private Ltd
- IHS Mccloskey Coal Group - USA
- Bahari Cakrawala Sebuku - Indonesia
- The State Trading Corporation of India Ltd
- Petron Corporation, Philippines
- New Zealand Coal & Carbon
- Star Paper Mills Limited - India
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- Meenaskhi Energy Private Limited - India
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Bharathi Cement Corporation - India
- Iligan Light & Power Inc, Philippines
- Meralco Power Generation, Philippines
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Gujarat Sidhee Cement - India
- SN Aboitiz Power Inc, Philippines
- Tata Chemicals Ltd - India
- Carbofer General Trading SA - India
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- Sical Logistics Limited - India
- SMG Consultants - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kapuas Tunggal Persada - Indonesia
- CNBM International Corporation - China
- Cigading International Bulk Terminal - Indonesia
- LBH Netherlands Bv - Netherlands
- SMC Global Power, Philippines
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Banpu Public Company Limited - Thailand
- Edison Trading Spa - Italy
- GAC Shipping (India) Pvt Ltd
- Kartika Selabumi Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Mjunction Services Limited - India
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Marubeni Corporation - India
- Bukit Makmur.PT - Indonesia
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Heidelberg Cement - Germany
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Oldendorff Carriers - Singapore
- Rashtriya Ispat Nigam Limited - India
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- Riau Bara Harum - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- European Bulk Services B.V. - Netherlands
- Electricity Authority, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Xindia Steels Limited - India
- Formosa Plastics Group - Taiwan
- Wood Mackenzie - Singapore
- Coalindo Energy - Indonesia
- Indika Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Bulk Trading Sa - Switzerland
- Kepco SPC Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- OPG Power Generation Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Kaltim Prima Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- Bhoruka Overseas - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Malabar Cements Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Economic Council, Georgia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- Planning Commission, India
- Global Business Power Corporation, Philippines
- Bhatia International Limited - India
- Attock Cement Pakistan Limited
- Sojitz Corporation - Japan
- International Coal Ventures Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Romanian Commodities Exchange
- Alfred C Toepfer International GmbH - Germany
- McConnell Dowell - Australia
- Vizag Seaport Private Limited - India
- Australian Coal Association
- Intertek Mineral Services - Indonesia
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- Ambuja Cements Ltd - India
- Commonwealth Bank - Australia
- Indian Oil Corporation Limited
- Cement Manufacturers Association - India
- ICICI Bank Limited - India
- Agrawal Coal Company - India
- Trasteel International SA, Italy
- Antam Resourcindo - Indonesia
- Wilmar Investment Holdings
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Ministry of Mines - Canada
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Thai Mozambique Logistica
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Merrill Lynch Commodities Europe
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- Ind-Barath Power Infra Limited - India
- Ministry of Transport, Egypt
- Interocean Group of Companies - India
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Semirara Mining and Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Price Waterhouse Coopers - Russia
- Kumho Petrochemical, South Korea
- The University of Queensland
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- The Treasury - Australian Government
- Energy Link Ltd, New Zealand
- Central Electricity Authority - India
- Binh Thuan Hamico - Vietnam
- Holcim Trading Pte Ltd - Singapore
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Goldman Sachs - Singapore
- Karaikal Port Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
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