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