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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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Wednesday, 25 May 16
DRY BULK SNP MARKET DISPLAYS SIGNS OF STRENGTH - GEORGE ILIOPOULOS
Only a couple of weeks away from the world’s most prominent maritime event, the market for tankers displays an evident lack of confidence in ...
Tuesday, 24 May 16
WEEKLY CS COAL INDICES NEGATIVE FOR ALL TYPES OF COAL EXCEPT 3800 GAR COAL
COALspot.com: Average 5000 GAR coal index of Indonesian origin was down 0.10 percent week over week to averaging $38.90 per ton this past week, sho ...
Monday, 23 May 16
A PERFECT STORM FOR INDONESIAN STEAM COAL EXPORTS - CLARKSON RESEARCH
Indonesia is the world’s leading steam coal exporter, accounting for over 40% of global seaborne steam coal exports since 2010. However in 20 ...
Monday, 23 May 16
THE PANAMAX INDEX WAS UP 17 POINTS W/W
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities rose this week.
The freight market was firm and all ...
Friday, 20 May 16
SHIPBUILDING CONTRACTS: CAN I CANCEL? SHOULD I CANCEL? - THE SHIPOWNER CLUB
KNOWLEDGE TO ELEVATE
There are many circumstances in which a buyer of a new-build vessel might want to terminate or cancel their contract with ...
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Showing 2421 to 2425 news of total 6871 |
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- McConnell Dowell - Australia
- Ind-Barath Power Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Riau Bara Harum - Indonesia
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Kartika Selabumi Mining - Indonesia
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Anglo American - United Kingdom
- Larsen & Toubro Limited - India
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- Romanian Commodities Exchange
- Bangladesh Power Developement Board
- Kalimantan Lumbung Energi - Indonesia
- Coal and Oil Company - UAE
- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Miang Besar Coal Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Altura Mining Limited, Indonesia
- Port Waratah Coal Services - Australia
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- Wilmar Investment Holdings
- Manunggal Multi Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Indian Oil Corporation Limited
- CNBM International Corporation - China
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Kohat Cement Company Ltd. - Pakistan
- VISA Power Limited - India
- PowerSource Philippines DevCo
- Electricity Generating Authority of Thailand
- Banpu Public Company Limited - Thailand
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Star Paper Mills Limited - India
- Malabar Cements Ltd - India
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Binh Thuan Hamico - Vietnam
- Salva Resources Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Standard Chartered Bank - UAE
- MS Steel International - UAE
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- PTC India Limited - India
- Orica Mining Services - Indonesia
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Ministry of Finance - Indonesia
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Pendopo Energi Batubara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Kideco Jaya Agung - Indonesia
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- India Bulls Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Medco Energi Mining Internasional
- Central Java Power - Indonesia
- Bhoruka Overseas - Indonesia
- SMC Global Power, Philippines
- Planning Commission, India
- White Energy Company Limited
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Krishnapatnam Port Company Ltd. - India
- Marubeni Corporation - India
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- Central Electricity Authority - India
- Chettinad Cement Corporation Ltd - India
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Lanco Infratech Ltd - India
- Meenaskhi Energy Private Limited - India
- Tata Chemicals Ltd - India
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Makarim & Taira - Indonesia
- Global Business Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- Kapuas Tunggal Persada - Indonesia
- Commonwealth Bank - Australia
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Globalindo Alam Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- Indika Energy - Indonesia
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Bulk Trading Sa - Switzerland
- Bhushan Steel Limited - India
- Rio Tinto Coal - Australia
- ASAPP Information Group - India
- Indian Energy Exchange, India
- The Treasury - Australian Government
- Energy Link Ltd, New Zealand
- Mercator Lines Limited - India
- Asmin Koalindo Tuhup - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- Cigading International Bulk Terminal - Indonesia
- Eastern Coal Council - USA
- Siam City Cement PLC, Thailand
- Bayan Resources Tbk. - Indonesia
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- Jaiprakash Power Ventures ltd
- Interocean Group of Companies - India
- GVK Power & Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- CIMB Investment Bank - Malaysia
- The University of Queensland
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
- Global Green Power PLC Corporation, Philippines
- Sojitz Corporation - Japan
- Borneo Indobara - Indonesia
- Indo Tambangraya Megah - Indonesia
- Therma Luzon, Inc, Philippines
- Parliament of New Zealand
- Essar Steel Hazira Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Iligan Light & Power Inc, Philippines
- Vedanta Resources Plc - India
- Kepco SPC Power Corporation, Philippines
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- Ambuja Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Maheswari Brothers Coal Limited - India
- Tamil Nadu electricity Board
- Wood Mackenzie - Singapore
- SMG Consultants - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- Metalloyd Limited - United Kingdom
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Aditya Birla Group - India
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- Edison Trading Spa - Italy
- Gujarat Sidhee Cement - India
- Mercuria Energy - Indonesia
- Australian Coal Association
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Minerals Council of Australia
- Global Coal Blending Company Limited - Australia
- Sree Jayajothi Cements Limited - India
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- Independent Power Producers Association of India
- Electricity Authority, New Zealand
- Kaltim Prima Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- Bukit Baiduri Energy - Indonesia
- Power Finance Corporation Ltd., India
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
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