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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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Monday, 25 September 17
U.S WEEKLY COAL OUTPUT DROPS FOR THE FOURTH WEEK IN A ROW, EIA DATA SHOWS
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.5 million short ton ...
Wednesday, 20 September 17
SHIPPING MARKET INSIGHT - INTERMODAL
An undoubtedly interesting market lately is the newbuilding market, in which we are witnessing numerous orders across all sectors and sizes. At the ...
Monday, 18 September 17
COAL PRICES WERE RELATIVELY UNCHANGED WEEK OVER WEEK - ANZ
COALspot.com: Coal prices were relatively unchanged, with most interest remaining in the thermal coal market said Daniel Hynes. However, falling st ...
Monday, 18 September 17
PROSPECTS ARE NOT SO CLEAR CUT FOR COAL - CLARKSONS
Prospects are not so clear-cut for coal. According to Clarksons, coal has been a key energy source since the Industrial Revolution and in 2016, ste ...
Friday, 15 September 17
U.S WEEKLY COAL OUTPUT DROPS FOR THE THIRD WEEK IN A ROW, EIA DATA SHOWS
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.7 million short ton ...
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Showing 1936 to 1940 news of total 6871 |
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- Goldman Sachs - Singapore
- Kideco Jaya Agung - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Videocon Industries ltd - India
- Port Waratah Coal Services - Australia
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Makarim & Taira - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Directorate Of Revenue Intelligence - India
- Edison Trading Spa - Italy
- Semirara Mining and Power Corporation, Philippines
- Coal and Oil Company - UAE
- Central Electricity Authority - India
- Banpu Public Company Limited - Thailand
- Indika Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- OPG Power Generation Pvt Ltd - India
- New Zealand Coal & Carbon
- Simpson Spence & Young - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Renaissance Capital - South Africa
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- GMR Energy Limited - India
- Siam City Cement - Thailand
- Heidelberg Cement - Germany
- Larsen & Toubro Limited - India
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Economic Council, Georgia
- Mintek Dendrill Indonesia
- IHS Mccloskey Coal Group - USA
- Cement Manufacturers Association - India
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- Parliament of New Zealand
- Malabar Cements Ltd - India
- Oldendorff Carriers - Singapore
- Asmin Koalindo Tuhup - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Mines - Canada
- White Energy Company Limited
- Alfred C Toepfer International GmbH - Germany
- Merrill Lynch Commodities Europe
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- Star Paper Mills Limited - India
- Power Finance Corporation Ltd., India
- Sakthi Sugars Limited - India
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Eastern Energy - Thailand
- Krishnapatnam Port Company Ltd. - India
- Maheswari Brothers Coal Limited - India
- Jaiprakash Power Ventures ltd
- Orica Mining Services - Indonesia
- European Bulk Services B.V. - Netherlands
- Australian Coal Association
- Mjunction Services Limited - India
- Holcim Trading Pte Ltd - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- SMC Global Power, Philippines
- Sindya Power Generating Company Private Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Price Waterhouse Coopers - Russia
- Bhatia International Limited - India
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Interocean Group of Companies - India
- Karbindo Abesyapradhi - Indoneisa
- Samtan Co., Ltd - South Korea
- Bangladesh Power Developement Board
- International Coal Ventures Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Binh Thuan Hamico - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Attock Cement Pakistan Limited
- Essar Steel Hazira Ltd - India
- ICICI Bank Limited - India
- Siam City Cement PLC, Thailand
- GAC Shipping (India) Pvt Ltd
- Coastal Gujarat Power Limited - India
- Coalindo Energy - Indonesia
- Minerals Council of Australia
- India Bulls Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Eastern Coal Council - USA
- Ministry of Finance - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Georgia Ports Authority, United States
- Uttam Galva Steels Limited - India
- Vizag Seaport Private Limited - India
- Savvy Resources Ltd - HongKong
- Thiess Contractors Indonesia
- Planning Commission, India
- Carbofer General Trading SA - India
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Africa Commodities Group - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Energy Link Ltd, New Zealand
- PNOC Exploration Corporation - Philippines
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Commonwealth Bank - Australia
- Semirara Mining Corp, Philippines
- IEA Clean Coal Centre - UK
- Electricity Authority, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Trasteel International SA, Italy
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Thai Mozambique Logistica
- Ceylon Electricity Board - Sri Lanka
- The University of Queensland
- Central Java Power - Indonesia
- Mercator Lines Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Leighton Contractors Pty Ltd - Australia
- Barasentosa Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Sojitz Corporation - Japan
- Sical Logistics Limited - India
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Baramulti Group, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Bhoruka Overseas - Indonesia
- PTC India Limited - India
- Antam Resourcindo - Indonesia
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- Energy Development Corp, Philippines
- Deloitte Consulting - India
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- Bhushan Steel Limited - India
- Kumho Petrochemical, South Korea
- Latin American Coal - Colombia
- CNBM International Corporation - China
- Tamil Nadu electricity Board
- Altura Mining Limited, Indonesia
- Medco Energi Mining Internasional
- Sarangani Energy Corporation, Philippines
- Indonesian Coal Mining Association
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Indian Oil Corporation Limited
- Kartika Selabumi Mining - Indonesia
- McConnell Dowell - Australia
- Indo Tambangraya Megah - Indonesia
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- London Commodity Brokers - England
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Borneo Indobara - Indonesia
- Marubeni Corporation - India
- Iligan Light & Power Inc, Philippines
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