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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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Thursday, 24 March 16
NEWBUILDINGS' PRICES HAVE STARTED TO COME DOWN - ALLIED | HELLENIC SHIPPING NEWS
Newbuildings’ prices have started to come down, as demand has remained subdued for quite some time now. In its latest weekly report, shipbrok ...
Wednesday, 23 March 16
THE PANAMA CANAL - WILL THE MELTING OF POLAR ICE CAPS CREATE RIVAL NAVIGATIONAL WATERWAYS THROUGH THE ARCTIC? - INTERMODAL
The Panama Canal, 102 years after its initial opening, is now about to have its expansion completed with a cost of USD5.25 Billion. It is a project ...
Tuesday, 22 March 16
FOUR NEW MARKET MEMBERS HAVE JOINED GLOBALCOAL
globalCOAL® announced yesterday that four new Market Members have joined its international trading community.
Ferrocadia DMCC is an intern ...
Monday, 21 March 16
INDONESIAN 4200 GAR COAL INDEX ROSE $0.12 OR, 0.44% WEEK OVER WEEK; INDEX CLOASED AT $27.19 A TON
COALspot.com: Average 5000 GAR coal index of Indonesian origin rose 0.21 percent week over week to averaging $38.90 per ton on this past Friday, ac ...
Monday, 21 March 16
THE BALTIC DRY INDEX ROSE SLIGHTLY WEEK OVER WEEK; BCI UP 11.93%
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities continued rose this week helped by higher rates for Cape ...
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Showing 2511 to 2515 news of total 6871 |
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- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- Barasentosa Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Commodity Traders Exchange
- OPG Power Generation Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Madhucon Powers Ltd - India
- Central Java Power - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Petron Corporation, Philippines
- Interocean Group of Companies - India
- SN Aboitiz Power Inc, Philippines
- Sojitz Corporation - Japan
- Dalmia Cement Bharat India
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Transport, Egypt
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Vizag Seaport Private Limited - India
- Indogreen Group - Indonesia
- Formosa Plastics Group - Taiwan
- London Commodity Brokers - England
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- IHS Mccloskey Coal Group - USA
- Videocon Industries ltd - India
- Binh Thuan Hamico - Vietnam
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- Iligan Light & Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Finance - Indonesia
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- GVK Power & Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Metalloyd Limited - United Kingdom
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Singapore Mercantile Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- India Bulls Power Limited - India
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- ASAPP Information Group - India
- Toyota Tsusho Corporation, Japan
- IEA Clean Coal Centre - UK
- Maharashtra Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Latin American Coal - Colombia
- The Treasury - Australian Government
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kobexindo Tractors - Indoneisa
- Orica Mining Services - Indonesia
- Bhoruka Overseas - Indonesia
- Renaissance Capital - South Africa
- Banpu Public Company Limited - Thailand
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Coastal Gujarat Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Australian Coal Association
- Price Waterhouse Coopers - Russia
- Bangladesh Power Developement Board
- Grasim Industreis Ltd - India
- Global Green Power PLC Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- New Zealand Coal & Carbon
- Essar Steel Hazira Ltd - India
- Anglo American - United Kingdom
- Attock Cement Pakistan Limited
- Cigading International Bulk Terminal - Indonesia
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Georgia Ports Authority, United States
- Eastern Energy - Thailand
- GAC Shipping (India) Pvt Ltd
- Samtan Co., Ltd - South Korea
- The University of Queensland
- SMC Global Power, Philippines
- Semirara Mining and Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- Goldman Sachs - Singapore
- Oldendorff Carriers - Singapore
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Star Paper Mills Limited - India
- Mjunction Services Limited - India
- Salva Resources Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Ambuja Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Standard Chartered Bank - UAE
- Siam City Cement - Thailand
- Billiton Holdings Pty Ltd - Australia
- Mercuria Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Ceylon Electricity Board - Sri Lanka
- GN Power Mariveles Coal Plant, Philippines
- Commonwealth Bank - Australia
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- Gujarat Sidhee Cement - India
- Lanco Infratech Ltd - India
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Aboitiz Power Corporation - Philippines
- Meralco Power Generation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Independent Power Producers Association of India
- Ministry of Mines - Canada
- Savvy Resources Ltd - HongKong
- Thai Mozambique Logistica
- Orica Australia Pty. Ltd.
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- VISA Power Limited - India
- Sree Jayajothi Cements Limited - India
- Semirara Mining Corp, Philippines
- Agrawal Coal Company - India
- Parliament of New Zealand
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Thiess Contractors Indonesia
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Heidelberg Cement - Germany
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Riau Bara Harum - Indonesia
- Pendopo Energi Batubara - Indonesia
- Indian Energy Exchange, India
- Sakthi Sugars Limited - India
- San Jose City I Power Corp, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- Altura Mining Limited, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Eastern Coal Council - USA
- MS Steel International - UAE
- Coal and Oil Company - UAE
- Antam Resourcindo - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Mintek Dendrill Indonesia
- Meenaskhi Energy Private Limited - India
- Edison Trading Spa - Italy
- PTC India Limited - India
- Sarangani Energy Corporation, Philippines
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- The State Trading Corporation of India Ltd
- Bulk Trading Sa - Switzerland
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- Uttam Galva Steels Limited - India
- Ind-Barath Power Infra Limited - India
- Indika Energy - Indonesia
- Energy Link Ltd, New Zealand
- Tata Chemicals Ltd - India
- Globalindo Alam Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- SMG Consultants - Indonesia
- Power Finance Corporation Ltd., India
- Siam City Cement PLC, Thailand
- Central Electricity Authority - India
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Africa Commodities Group - South Africa
- Miang Besar Coal Terminal - Indonesia
- Bhushan Steel Limited - India
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