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Monday, 06 October 14
' COAL-BY-WIRE' FROM SUMATRA TO JAVA - THE JAKARTA POST
 Coal from the island of Sumatra accounts for most of Indonesia’s low-grade lignite, a low-quality coal that receives a poor price in international markets.
Given this low pricing combined with high transportation costs and the fact that most reserves are located in landlocked areas, it is not feasible to export Sumatra’s coal out of the island.
It is more efficient to use Sumatra’s coal for a mine-mouth power plant, an approach in which we develop a power plant very close to where mines are located, use the low-calorie coal from the mines to feed the plant, and transmit the electricity, rather than transporting a low-value commodity, out of the mines.
With mine-mouth, we no longer require either barges or expensive railway-heavy infrastructure to transport coal; rather we need to have long-distance high-voltage transmission lines to bring “coal-by-wire” from mines to consumer centers, either regions in Sumatra and/or Java-Bali.
Essentially, with “coal-by-wire” we are transporting a higher-value commodity by wire from mines to customers. Coal stays in the landlocked areas and feeds mine-mouth, coal-fired power plants.
“Coal-by-wire” would definitely boost the development of a domestic market for low-grade coal. Today, our market for coal is very thin as we are one of the world’s leading exporters of thermal coal of a high quality in the international market.
Our exports have increased very significantly within the past decade on account of demand from fast-growing Asian economies. More than 80 percent of our coal currently produced is exported.
Indeed, coal is currently the most important source of energy for our economy. For decades coal has accounted for more than half of our power-generation capacity. And this will continue for a half century to come before alternative and cleaner energy sources other than coal become affordably available.
Our economy is also growing, and of course will require more electricity power and therefore coal – challenges that have to be met. Electricity generation now consumes close to 75 million tons per year, and will almost triple in the next 10 to 15 years.
However, domestic use of coal today notoriously suffers from infrastructure bottlenecks. Congested barges and ports, as well as a shortage of railways limit the transportation of coal from coalmines in two coal-producing regions, Kalimantan and Sumatra, to demand centers in Java-Bali, where most of our power plants are located.
The majority of our coal reserves in the two regions are located in landlocked areas that require rail transportation infrastructure to reach ports for export.
Either truck haul or rail is needed to transport the coal to barge ports and terminals.
Truck operating costs are about twice that of rail, but existing rail transportation infrastructure is severely insufficient.
Indonesia’s attempts to improve coal-transport infrastructure for the domestic market have not been very successful. Dedicated coal ports in Kalimantan have been planned for many years, but implementation has again faced bottleneck issues.
Specialized railways for coal in Sumatra have also been initiated, but this concept is still under development and has not yet received a higher-level mandate or legal authorization.
Delays in expanding the capacity of barge and transportation infrastructure cause inefficiencies and high transportation costs in domestic coal utilization. These high costs and infrastructure bottlenecks have held back the development of the domestic market for coal.
Our high-voltage transmission lines are also astonishingly limited. The state-owned electricity company (PLN) operates approximately 40,000 kilometers of transmission lines, with less than 15 percent of this total serving the island of Sumatra.
If we can build more mine-mouth, coal-fired power generation plants we will need to expand our transmission network across the island, interconnected to other transmission systems in Java-Bali.
A new set of lines of a high-voltage of 500 kilovolts and medium-voltage of 275 kV needs to be developed as a backbone network across the island, i.e. providing long-distance, reliable and stable transmission.
The distribution system and transformer capacity also need to be expanded to service a larger coverage of costumers and demand centers.
We are required also to develop an interconnected transmission system, as existing electricity transmission is not compatible across regions due to different systems and manufacturer standards adopted in the past.
The current initiative of developing inter-island interconnection lines between Java and Sumatra with 500kV High Voltage Direct Current (HVDC) lines needs to be completed in harmony with the mine-mouth development.
These long-distance transmission and distribution lines, as well as interconnected systems are required to exist before a system of mine-mouth power plants is commissioned to ensure that electricity produced can be transmitted in a timely manner and with minimum cost.
Both the central and local governments must work hand-in-hand to endorse incentives to encourage the private sector — independent power producers (IPPs) — to develop mine-mouth power plants.
Incentives need to be designed to enhance the financial viability of IPPs’ mine-mouth power plant projects.
PLN as an off-taker of IPP plays a fundamental role as the “coal-by-wire” agent, and has to be ready to absorb all of the risks associated with the development and operation of the system, including the difficulties in land acquisition and intra-regional compatibility of transmission systems.
Sumatra with its huge resources of low-grade coal can secure its own electricity supply and, eventually, can be the source of low-cost electricity with its energy radiating not only to Java, but also to every corner of the country.
Source: The Jakarta Post
The writer is deputy for energy and mineral resources at the office of Coordinating Economic Minister.
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Thursday, 16 October 14
PANAMAX OWNERS RECEIVE A PREMIUM FOR GOING TO INDIA VIA INDONESIA - FEARNLEYS AS
Handy
The Handy/Supra market continues to slide in both hemispheres, said Fearnleys AS in its latest week report. In the Atlantic we see rates co ...
Thursday, 16 October 14
ARE WE GOING TO SHOOT OURSELVES IN THE FOOT ONCE AGAIN? - PANOS MAKRINOS
As the East part of our globe was coming back from its October holidays last week, everyone expected that the Dry Bulk market would follow suit and ...
Wednesday, 15 October 14
PANAMAX: ACTIVITY IN THE PACIFIC WAS UNIMPRESSIVE
The Dry Bulk market noted another weekly decline last week, while the BDI moved below 1,000 points taking down with it expectations that a post hol ...
Wednesday, 15 October 14
INDONESIAN COAL PRICE REFERENCE FELL TO FRESH MULTI-YEAR LOWS IN OCTOBER
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia revised down the coal bench mark price once again in October 2014.
...
Wednesday, 15 October 14
DRY BULK SHIPPING: RATE IMPROVEMENTS ARRIVED AS FORECAST, BUT UNCERTAINTY MOUNTS FOR 2015 DEMAND - BIMCO
BIMCO released its latest short term assessment of the dry bulk market, estimating that over the October-November period, the level of Capesize TC ...
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- Straits Asia Resources Limited - Singapore
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Power Finance Corporation Ltd., India
- Kepco SPC Power Corporation, Philippines
- ASAPP Information Group - India
- Ceylon Electricity Board - Sri Lanka
- Salva Resources Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Meralco Power Generation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Pendopo Energi Batubara - Indonesia
- Australian Commodity Traders Exchange
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Rashtriya Ispat Nigam Limited - India
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Indian Energy Exchange, India
- Rio Tinto Coal - Australia
- PTC India Limited - India
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- Bhatia International Limited - India
- Coalindo Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- Siam City Cement - Thailand
- Borneo Indobara - Indonesia
- Electricity Authority, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Jindal Steel & Power Ltd - India
- Timah Investasi Mineral - Indoneisa
- Tamil Nadu electricity Board
- Parliament of New Zealand
- The University of Queensland
- Thiess Contractors Indonesia
- Kumho Petrochemical, South Korea
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- New Zealand Coal & Carbon
- Maheswari Brothers Coal Limited - India
- Indonesian Coal Mining Association
- Kalimantan Lumbung Energi - Indonesia
- Star Paper Mills Limited - India
- Wood Mackenzie - Singapore
- Latin American Coal - Colombia
- Central Electricity Authority - India
- Binh Thuan Hamico - Vietnam
- India Bulls Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- McConnell Dowell - Australia
- VISA Power Limited - India
- Sree Jayajothi Cements Limited - India
- Minerals Council of Australia
- SMG Consultants - Indonesia
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Bahari Cakrawala Sebuku - Indonesia
- Sindya Power Generating Company Private Ltd
- AsiaOL BioFuels Corp., Philippines
- Edison Trading Spa - Italy
- Ambuja Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- Bangladesh Power Developement Board
- Essar Steel Hazira Ltd - India
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- CNBM International Corporation - China
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Electricity Generating Authority of Thailand
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- Gujarat Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- Energy Link Ltd, New Zealand
- Iligan Light & Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Intertek Mineral Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- IHS Mccloskey Coal Group - USA
- Price Waterhouse Coopers - Russia
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- Indika Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Therma Luzon, Inc, Philippines
- Trasteel International SA, Italy
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- PowerSource Philippines DevCo
- GVK Power & Infra Limited - India
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- Posco Energy - South Korea
- IEA Clean Coal Centre - UK
- Savvy Resources Ltd - HongKong
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Larsen & Toubro Limited - India
- Riau Bara Harum - Indonesia
- Chamber of Mines of South Africa
- White Energy Company Limited
- Indian Oil Corporation Limited
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Chettinad Cement Corporation Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining Corp, Philippines
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- PNOC Exploration Corporation - Philippines
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Sakthi Sugars Limited - India
- Bukit Baiduri Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- Agrawal Coal Company - India
- Gujarat Mineral Development Corp Ltd - India
- Georgia Ports Authority, United States
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Coal Blending Company Limited - Australia
- Marubeni Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Samtan Co., Ltd - South Korea
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Global Business Power Corporation, Philippines
- Commonwealth Bank - Australia
- GMR Energy Limited - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Indogreen Group - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Bukit Makmur.PT - Indonesia
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
- Central Java Power - Indonesia
- Oldendorff Carriers - Singapore
- ICICI Bank Limited - India
- The Treasury - Australian Government
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Orica Australia Pty. Ltd.
- Romanian Commodities Exchange
- Vizag Seaport Private Limited - India
- Mjunction Services Limited - India
- Kobexindo Tractors - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- Renaissance Capital - South Africa
- European Bulk Services B.V. - Netherlands
- Kapuas Tunggal Persada - Indonesia
- Attock Cement Pakistan Limited
- International Coal Ventures Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- Aditya Birla Group - India
- LBH Netherlands Bv - Netherlands
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