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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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Tuesday, 05 September 17
COAL: A STRONG MOVEMENT IN THE COAL MARKET OVER THE SUMMER MONTHS - GEORGE LAZARIDIS
We have been witnessing a strong movement in the coal market over the summer months something that has not only helped boost prices for the commodi ...
Friday, 01 September 17
U.S COAL OUTPUT DIPS WEEK OVER WEEK, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 16.7 million short ton ...
Thursday, 31 August 17
SUPRAMAX: INDO TO CHINA COAL TRIPS AT AROUND $9000, DELIVERY THAILAND - FEARNLEYS
Supramax
A bit slow start to the week with UK holidays on Monday. Still strong rates for cargoes out of Black Sea, where front hauls where done $ ...
Tuesday, 29 August 17
WEEKLY SHIPPING MARKET ANALYSIS - ALLIED
In the aftermath of Hurricane Harvey, one of the worst disasters to hit Texas, we are now looking to get a clearer picture of the possible disrupti ...
Tuesday, 29 August 17
U.S WEEKLY COAL OUT UP 3.4% WEEK OVER WEEK TO APPROX. 17 MMST, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 17 million short tonne ...
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Showing 1956 to 1960 news of total 6871 |
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- Electricity Authority, New Zealand
- India Bulls Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Kartika Selabumi Mining - Indonesia
- Parliament of New Zealand
- Commonwealth Bank - Australia
- VISA Power Limited - India
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Metalloyd Limited - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Bukit Baiduri Energy - Indonesia
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- The University of Queensland
- Planning Commission, India
- Star Paper Mills Limited - India
- Malabar Cements Ltd - India
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Indian Energy Exchange, India
- Parry Sugars Refinery, India
- Power Finance Corporation Ltd., India
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- Leighton Contractors Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Carbofer General Trading SA - India
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Toyota Tsusho Corporation, Japan
- Directorate General of MIneral and Coal - Indonesia
- Sakthi Sugars Limited - India
- Latin American Coal - Colombia
- Xindia Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- Vizag Seaport Private Limited - India
- Wilmar Investment Holdings
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Mines - Canada
- Chamber of Mines of South Africa
- Alfred C Toepfer International GmbH - Germany
- Bukit Asam (Persero) Tbk - Indonesia
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Wood Mackenzie - Singapore
- Global Business Power Corporation, Philippines
- Thiess Contractors Indonesia
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Trasteel International SA, Italy
- Petron Corporation, Philippines
- Intertek Mineral Services - Indonesia
- McConnell Dowell - Australia
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Jaiprakash Power Ventures ltd
- Essar Steel Hazira Ltd - India
- ICICI Bank Limited - India
- Rio Tinto Coal - Australia
- Ministry of Transport, Egypt
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- Georgia Ports Authority, United States
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Central Electricity Authority - India
- Central Java Power - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining Corp, Philippines
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Coal Association
- Thai Mozambique Logistica
- Sindya Power Generating Company Private Ltd
- Sical Logistics Limited - India
- OPG Power Generation Pvt Ltd - India
- Anglo American - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Oldendorff Carriers - Singapore
- Tata Chemicals Ltd - India
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- Bayan Resources Tbk. - Indonesia
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CNBM International Corporation - China
- Gujarat Electricity Regulatory Commission - India
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Electricity Generating Authority of Thailand
- PowerSource Philippines DevCo
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Mercuria Energy - Indonesia
- Marubeni Corporation - India
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- IEA Clean Coal Centre - UK
- Energy Development Corp, Philippines
- Indonesian Coal Mining Association
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- Lanco Infratech Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Bhushan Steel Limited - India
- Bhoruka Overseas - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Jindal Steel & Power Ltd - India
- Aditya Birla Group - India
- Globalindo Alam Lestari - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Maheswari Brothers Coal Limited - India
- White Energy Company Limited
- San Jose City I Power Corp, Philippines
- Orica Mining Services - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- Heidelberg Cement - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Africa Commodities Group - South Africa
- Coal and Oil Company - UAE
- Karaikal Port Pvt Ltd - India
- Standard Chartered Bank - UAE
- Interocean Group of Companies - India
- Minerals Council of Australia
- Indogreen Group - Indonesia
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Kumho Petrochemical, South Korea
- Gujarat Sidhee Cement - India
- Sarangani Energy Corporation, Philippines
- Coalindo Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Kepco SPC Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- LBH Netherlands Bv - Netherlands
- Chettinad Cement Corporation Ltd - India
- Indian Oil Corporation Limited
- Mjunction Services Limited - India
- Salva Resources Pvt Ltd - India
- Renaissance Capital - South Africa
- European Bulk Services B.V. - Netherlands
- Edison Trading Spa - Italy
- Medco Energi Mining Internasional
- Savvy Resources Ltd - HongKong
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Simpson Spence & Young - Indonesia
- Posco Energy - South Korea
- Global Green Power PLC Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Sree Jayajothi Cements Limited - India
- MS Steel International - UAE
- Miang Besar Coal Terminal - Indonesia
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indo Tambangraya Megah - Indonesia
- Bharathi Cement Corporation - India
- Kaltim Prima Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Pendopo Energi Batubara - Indonesia
- PNOC Exploration Corporation - Philippines
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