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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, 22 March 24
INDONESIA APPROVES 922.14 MLN T COAL PRODUCTION QUOTA FOR 2024, ABOVE TARGET - REUTERS
Indonesia has approved coal production quotas totalling 922.14 million metric tons for 2024, Bambang Suswantono, a senior official at the mining mi ...
Friday, 22 March 24
CHINA COAL INDUSTRY GROUP EXPECTS OUTPUT GROWTH TO SLOW IN 2024 - REUTERS
China’s coal output is expected to increase 36 million metric tons, or 0.8%, to about 4.7 billion tonnes in 2024, a Chinese coal industry gro ...
Monday, 18 March 24
THREE KEY TAKEAWAYS FROM OUR EUROPE GAS MARKETS SHORT-TERM OUTLOOK Q1 2024 - WOOD MACKENZIE
European gas prices are currently back to pre-crisis levels, but with a complex series of factors affecting future supply and demand, are they set ...
Wednesday, 06 March 24
INDONESIA AIMS TO FINISH MINING OUTPUT QUOTAS APPROVAL BY END-MARCH, OFFICIAL SAYS - REUTERS
Indonesia’s has approved the mining production quotarequests from more than 120mineral companies and aims to complete the approval process th ...
Monday, 04 March 24
IS YOUR GUARANTEE A GUARANTEE? NOTE TO SHIPOWNERS - GARD
KNOWLEDGE TO ELEVATE
The law of guarantees is not always obvious or easy to understand without proper guidance. This article clarifies the dif ...
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Showing 26 to 30 news of total 6871 |
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- Formosa Plastics Group - Taiwan
- Africa Commodities Group - South Africa
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- PNOC Exploration Corporation - Philippines
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- Coalindo Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- VISA Power Limited - India
- Mjunction Services Limited - India
- MS Steel International - UAE
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Semirara Mining Corp, Philippines
- Madhucon Powers Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Sical Logistics Limited - India
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercuria Energy - Indonesia
- New Zealand Coal & Carbon
- Asmin Koalindo Tuhup - Indonesia
- Renaissance Capital - South Africa
- Chettinad Cement Corporation Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- Timah Investasi Mineral - Indoneisa
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Sinarmas Energy and Mining - Indonesia
- Independent Power Producers Association of India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Indonesian Coal Mining Association
- Globalindo Alam Lestari - Indonesia
- Grasim Industreis Ltd - India
- Commonwealth Bank - Australia
- SMG Consultants - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- Rio Tinto Coal - Australia
- Bayan Resources Tbk. - Indonesia
- Simpson Spence & Young - Indonesia
- Thiess Contractors Indonesia
- Oldendorff Carriers - Singapore
- Petron Corporation, Philippines
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- The University of Queensland
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- Latin American Coal - Colombia
- Maheswari Brothers Coal Limited - India
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Minerals Council of Australia
- Billiton Holdings Pty Ltd - Australia
- Wilmar Investment Holdings
- Sojitz Corporation - Japan
- CIMB Investment Bank - Malaysia
- Anglo American - United Kingdom
- The Treasury - Australian Government
- Dalmia Cement Bharat India
- ASAPP Information Group - India
- Singapore Mercantile Exchange
- Posco Energy - South Korea
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Karbindo Abesyapradhi - Indoneisa
- The State Trading Corporation of India Ltd
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- Salva Resources Pvt Ltd - India
- Indogreen Group - Indonesia
- Karaikal Port Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Kumho Petrochemical, South Korea
- CNBM International Corporation - China
- Ministry of Finance - Indonesia
- Malabar Cements Ltd - India
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- Attock Cement Pakistan Limited
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- ICICI Bank Limited - India
- Meralco Power Generation, Philippines
- Intertek Mineral Services - Indonesia
- McConnell Dowell - Australia
- Ceylon Electricity Board - Sri Lanka
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Siam City Cement PLC, Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Iligan Light & Power Inc, Philippines
- Romanian Commodities Exchange
- Altura Mining Limited, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Merrill Lynch Commodities Europe
- IEA Clean Coal Centre - UK
- Global Green Power PLC Corporation, Philippines
- Barasentosa Lestari - Indonesia
- London Commodity Brokers - England
- Economic Council, Georgia
- Samtan Co., Ltd - South Korea
- Energy Link Ltd, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Transport, Egypt
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Sidhee Cement - India
- Indian Oil Corporation Limited
- International Coal Ventures Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Miang Besar Coal Terminal - Indonesia
- Xindia Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- TeaM Sual Corporation - Philippines
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Makmur.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- San Jose City I Power Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- PTC India Limited - India
- Lanco Infratech Ltd - India
- Interocean Group of Companies - India
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- PowerSource Philippines DevCo
- Vizag Seaport Private Limited - India
- Thai Mozambique Logistica
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- IHS Mccloskey Coal Group - USA
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Kartika Selabumi Mining - Indonesia
- Central Electricity Authority - India
- Kaltim Prima Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate Of Revenue Intelligence - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Planning Commission, India
- Goldman Sachs - Singapore
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- GMR Energy Limited - India
- Mintek Dendrill Indonesia
- Global Business Power Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Meenaskhi Energy Private Limited - India
- Metalloyd Limited - United Kingdom
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Essar Steel Hazira Ltd - India
- Bhatia International Limited - India
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Savvy Resources Ltd - HongKong
- LBH Netherlands Bv - Netherlands
- Coastal Gujarat Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Ministry of Mines - Canada
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