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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, 04 August 17
U.S. WEEKLY COAL OUTPUT UP 4.4% W/W - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totaled an estimated 16.1 million short tonn ...
Friday, 04 August 17
IMPORTED COAL CONTINUES TO BE A COMPETITIVE, SAFE AND RELIABLE ENERGY SOURCE FOR GERMANY - VDKI
COALspot.com: Worldwide hard coal production in 2016 declined by 3.8% to 6.7 billion tonnes.
According to the Germany Coal Importers Associati ...
Thursday, 03 August 17
SUPRAMAX: INDO TO CHINA COAL ROUNDS ARE GETTING FIXED AROUND MID $8000 - FEARNLEYS
In the Pacific rates have remained weak and under pressure this week with most routes softening.
Indo/China coal rounds are getting fixed arou ...
Thursday, 03 August 17
BUMI RESOURCES COAL SALES RELATIVELY FLAT AT 41.5 MILLION TONS IN 1H' 17; REPORTS US$162.3 MILLION PROFIT IN FIRST SEMESTER
COALspot.com: The BUMI Resources, Indonesia’s one of the largest coal producer, has reported a net income of $162.3 million in 1H’ 17 c ...
Wednesday, 02 August 17
SHIPPING MARKET INSIGHT - GIANNIS ANDRITSOPOULOS
During the duration of the first half of the year, the dry bulk market saw intense buying interest that boosted SnP prices significantly. We saw a ...
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Showing 1986 to 1990 news of total 6871 |
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- Ministry of Finance - Indonesia
- Banpu Public Company Limited - Thailand
- CNBM International Corporation - China
- Mjunction Services Limited - India
- ASAPP Information Group - India
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Marubeni Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Ministry of Mines - Canada
- IHS Mccloskey Coal Group - USA
- Larsen & Toubro Limited - India
- Port Waratah Coal Services - Australia
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Coastal Gujarat Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Samtan Co., Ltd - South Korea
- Deloitte Consulting - India
- Anglo American - United Kingdom
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- Singapore Mercantile Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Kumho Petrochemical, South Korea
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- Bangladesh Power Developement Board
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Madhucon Powers Ltd - India
- Australian Coal Association
- Central Electricity Authority - India
- Vijayanagar Sugar Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Mercator Lines Limited - India
- Intertek Mineral Services - Indonesia
- Central Java Power - Indonesia
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- OPG Power Generation Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Economic Council, Georgia
- SMC Global Power, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- Minerals Council of Australia
- Star Paper Mills Limited - India
- Krishnapatnam Port Company Ltd. - India
- Wilmar Investment Holdings
- Savvy Resources Ltd - HongKong
- CIMB Investment Bank - Malaysia
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- Commonwealth Bank - Australia
- Australian Commodity Traders Exchange
- Parry Sugars Refinery, India
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- Indo Tambangraya Megah - Indonesia
- The University of Queensland
- Ceylon Electricity Board - Sri Lanka
- Bukit Baiduri Energy - Indonesia
- Romanian Commodities Exchange
- Semirara Mining Corp, Philippines
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Medco Energi Mining Internasional
- Sarangani Energy Corporation, Philippines
- Goldman Sachs - Singapore
- Georgia Ports Authority, United States
- Indogreen Group - Indonesia
- Aboitiz Power Corporation - Philippines
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement - Thailand
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- New Zealand Coal & Carbon
- SN Aboitiz Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Binh Thuan Hamico - Vietnam
- TeaM Sual Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Electricity Authority, New Zealand
- Latin American Coal - Colombia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- Kobexindo Tractors - Indoneisa
- Bhushan Steel Limited - India
- Electricity Generating Authority of Thailand
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Aditya Birla Group - India
- Thiess Contractors Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Mining Services - Indonesia
- Lanco Infratech Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Altura Mining Limited, Indonesia
- Jindal Steel & Power Ltd - India
- Directorate Of Revenue Intelligence - India
- Kaltim Prima Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jaiprakash Power Ventures ltd
- Tata Chemicals Ltd - India
- GMR Energy Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- Karaikal Port Pvt Ltd - India
- Carbofer General Trading SA - India
- Global Green Power PLC Corporation, Philippines
- Xindia Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Kepco SPC Power Corporation, Philippines
- Baramulti Group, Indonesia
- Billiton Holdings Pty Ltd - Australia
- PowerSource Philippines DevCo
- Bharathi Cement Corporation - India
- Planning Commission, India
- Maharashtra Electricity Regulatory Commission - India
- Sojitz Corporation - Japan
- Globalindo Alam Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- McConnell Dowell - Australia
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Trasteel International SA, Italy
- Coal and Oil Company - UAE
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- VISA Power Limited - India
- Dalmia Cement Bharat India
- Sakthi Sugars Limited - India
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- Interocean Group of Companies - India
- Riau Bara Harum - Indonesia
- Parliament of New Zealand
- LBH Netherlands Bv - Netherlands
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- Malabar Cements Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- Eastern Coal Council - USA
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- PTC India Limited - India
- Leighton Contractors Pty Ltd - Australia
- GVK Power & Infra Limited - India
- White Energy Company Limited
- ICICI Bank Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- London Commodity Brokers - England
- Bukit Asam (Persero) Tbk - Indonesia
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- India Bulls Power Limited - India
- Bukit Makmur.PT - Indonesia
- Maheswari Brothers Coal Limited - India
- Uttam Galva Steels Limited - India
- Africa Commodities Group - South Africa
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- The State Trading Corporation of India Ltd
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Therma Luzon, Inc, Philippines
- The Treasury - Australian Government
- Global Business Power Corporation, Philippines
- Indian Oil Corporation Limited
- Vedanta Resources Plc - India
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