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