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