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Saturday, 31 October 09
PRODUCERS BENEFIT FROM COAL'S TIGHT SUPPLY AND STRONG DEMAND
 The Jakarta Post reported that, The outlook for Indonesian coal producers appears promising with strong volume growth coming from both the domestic and export markets.
Despite the delayed completion of the 10,000 megawatts (MW) coal-fired steam power plant (PLTU) program, we expect to see additional electricity capacity starting in the fourth quarter of 2009. PLTU Labuan (2x300 MW) was scheduled to operate its first unit in September 2009 and the second unit by December 2009.
PLTU Rembang (2x315 MW) and Indramayu (2x330 MW) should start to operate by January 2010. As nine out of 10 projects in Java-Bali are now in their construction stages, there should be a total add-on capacity of 6,830 MW by the end of 2010. Six PLTU projects (total capacity162 MW) outside the Java-Bali region have already started the construction stage in the fourth quarter of this year with an additional 5 to follow suit.
The Government of Indonesia has finally approved the coal volume required for the domestic market obligation (DMO) at 75 million tons per year starting from 2010, 10.3 percent higher year-on-year from 68 million tons of domestic consumption estimated for 2009.
The volume set for the DMO would amount to 30 percent of the 2010 total estimate for coal production at 250 million tons or up 8.7 percent year-on-year from the 2009 estimate of 230 million tons (chart 1). PLN itself has signed 20-year coal supply contracts, effective once the PLTUs are operational, amounting to 30m tons per year of low-rank coal.
We foresee that the implementation of the DMO has limited the flexibility for coal producers to aggressively penetrate the export market. On top of that, the government has recently revealed its intention to apply a restriction on export quotas at 150 million tons per year starting from 2010.
The regulations would also require each coal producer to allocate 25 percent of their total coal production for the domestic market, or to face penalties in the form of restrictions on their exports.
We see, however, that this last regulation might not be necessary due to the anticipated increase in the volume of coal production going forward, exceeding the domestic demand requirements.
On a more positive note, the government seems willing to accommodate Indonesian coal producers' wishes for minor interventions in regulating the sales price for coal under the DMO provisions. The sales price will be with reference to the international market price to avoid high spreads between export and domestic pricing.
Based on the Newcastle Index, the year-to-date coal price has averaged US$70.7 per ton. Despite a downward trend since the fourth quarter of 2008, coal prices have been relatively steady throughout 2009.
We believe that the price of coal has found its new equilibrium at current levels, supported by stronger demand for higher energy needs mostly in the South East Asian region. Hence, we now expect the coal price to average US$75/t in 2010.
Government also plans to cut the royalty tax rate (DPHB) on low calorific value coal. The proposed DPHB rate is 9 percent for coal with CV<5,000kcal/kg (vis-*-vis 13.5 percent previously) and 7.5 percent for CV<4,500kcal/kg.
We see that upon implementation, lower royalty rates will mean incentives towards growth expectations in the sector.
Stronger domestic demand starting from 2010 paired with recovery of global demand will provide higher volume support for demand for both thermal and coking coal. In our view India will provide the highest growth in thermal coal demand, boosting imports by about 18% to 40m tons beginning this year, in line with the government's plan to double coal-fired electricity generation capacity by 2017.
Indonesia has also made preparations to start the 10,000 MW program phase II which is scheduled to start in 2012 and to operate by 2014.
We estimate coal-fired power plants will take around 48 percent from the total portion of 9,963 MW. Furthermore, coal supply may not grow at the same pace as demand due to export restrictions set on major coal exporters, such as Vietnam and China to secure their domestic needs.
Supported by the fact that the China government has decided to reduce its export quota by 50 percent from 40 million tons to 20 million tons.
As one of the world's major coal exporters, Indonesia will certainly have the upper hand in the tightening supply of coal.
Source:The Jakarta Post
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Thursday, 05 November 09
MERCATOR LINES AIMS TO BECOME A $5 BILLION COMPANY
Mercator Lines, India’s second largest private sector shipping line, plans to invest and expand, riding India’s next wave of growth, the ...
Thursday, 05 November 09
HMS BERGBAU AG OPENING INDIAN OFFICE
Further step on internationalization track Office in Mumbai Participation in demand for coal imports
HMS Bergbau AG, is an international coal tra ...
Thursday, 05 November 09
SAM'S SEAFOOD HOLDINGS MOVES STEP CLOSER TO COAL EXPLORATION IN INDONESIA
Sam’s Seafood Holdings Limited, which is proposed to be renamed Pan Asia Corporation Limited, is moving closer to becoming an exploration and ...
Wednesday, 04 November 09
INDONESIA CAP ON COAL EXPORTS MAY HIT INDIAN POWER SECTOR
BL reported that Karnataka power sector is likely to be partially impacted by the Indonesian Government move to restrict coal exports.
Private se ...
Wednesday, 04 November 09
SA 2010 COAL EXPORTS SEEN AT 65M TO 68M TONS - ANALYSTS
South Africa's thermal coal exports could rise to as high as 68 million tonnes in 2010 but are more likely to be 64-65 million compared to 60 milli ...
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- CIMB Investment Bank - Malaysia
- Meralco Power Generation, Philippines
- Wilmar Investment Holdings
- Kobexindo Tractors - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Grasim Industreis Ltd - India
- Vizag Seaport Private Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- Africa Commodities Group - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Authority, New Zealand
- Mintek Dendrill Indonesia
- Georgia Ports Authority, United States
- Intertek Mineral Services - Indonesia
- Edison Trading Spa - Italy
- Tata Chemicals Ltd - India
- Ind-Barath Power Infra Limited - India
- Indian Oil Corporation Limited
- Kumho Petrochemical, South Korea
- Maharashtra Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Cigading International Bulk Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- Chamber of Mines of South Africa
- Semirara Mining Corp, Philippines
- Eastern Energy - Thailand
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- ASAPP Information Group - India
- Singapore Mercantile Exchange
- Directorate Of Revenue Intelligence - India
- Parliament of New Zealand
- Iligan Light & Power Inc, Philippines
- Thai Mozambique Logistica
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- Coastal Gujarat Power Limited - India
- Bhatia International Limited - India
- The University of Queensland
- Tamil Nadu electricity Board
- Central Electricity Authority - India
- Bukit Baiduri Energy - Indonesia
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- CNBM International Corporation - China
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Power Finance Corporation Ltd., India
- Global Coal Blending Company Limited - Australia
- PetroVietnam Power Coal Import and Supply Company
- Vedanta Resources Plc - India
- Anglo American - United Kingdom
- Savvy Resources Ltd - HongKong
- Sojitz Corporation - Japan
- Trasteel International SA, Italy
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Australian Coal Association
- AsiaOL BioFuels Corp., Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Marubeni Corporation - India
- Posco Energy - South Korea
- PTC India Limited - India
- Ministry of Transport, Egypt
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Malabar Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Jaiprakash Power Ventures ltd
- SN Aboitiz Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- San Jose City I Power Corp, Philippines
- Medco Energi Mining Internasional
- Riau Bara Harum - Indonesia
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- The State Trading Corporation of India Ltd
- Indogreen Group - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- Central Java Power - Indonesia
- Aditya Birla Group - India
- Alfred C Toepfer International GmbH - Germany
- SMC Global Power, Philippines
- Videocon Industries ltd - India
- International Coal Ventures Pvt Ltd - India
- Wood Mackenzie - Singapore
- MS Steel International - UAE
- Samtan Co., Ltd - South Korea
- Gujarat Mineral Development Corp Ltd - India
- Orica Australia Pty. Ltd.
- Karbindo Abesyapradhi - Indoneisa
- Karaikal Port Pvt Ltd - India
- Petron Corporation, Philippines
- Minerals Council of Australia
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- Kohat Cement Company Ltd. - Pakistan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Bhoruka Overseas - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- London Commodity Brokers - England
- Indika Energy - Indonesia
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- Ministry of Finance - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Binh Thuan Hamico - Vietnam
- Ambuja Cements Ltd - India
- VISA Power Limited - India
- Bangladesh Power Developement Board
- Dalmia Cement Bharat India
- Barasentosa Lestari - Indonesia
- Aboitiz Power Corporation - Philippines
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- Mercator Lines Limited - India
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- GAC Shipping (India) Pvt Ltd
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Kapuas Tunggal Persada - Indonesia
- Agrawal Coal Company - India
- Bayan Resources Tbk. - Indonesia
- Baramulti Group, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Indonesian Coal Mining Association
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- Sinarmas Energy and Mining - Indonesia
- Merrill Lynch Commodities Europe
- Energy Link Ltd, New Zealand
- Manunggal Multi Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- Siam City Cement PLC, Thailand
- Parry Sugars Refinery, India
- McConnell Dowell - Australia
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Carbofer General Trading SA - India
- Australian Commodity Traders Exchange
- OPG Power Generation Pvt Ltd - India
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Eastern Coal Council - USA
- IHS Mccloskey Coal Group - USA
- Billiton Holdings Pty Ltd - Australia
- Sarangani Energy Corporation, Philippines
- India Bulls Power Limited - India
- Meenaskhi Energy Private Limited - India
- Indian Energy Exchange, India
- Formosa Plastics Group - Taiwan
- Bulk Trading Sa - Switzerland
- SMG Consultants - Indonesia
- Port Waratah Coal Services - Australia
- South Luzon Thermal Energy Corporation
- Standard Chartered Bank - UAE
- Renaissance Capital - South Africa
- Thiess Contractors Indonesia
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- Semirara Mining and Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Interocean Group of Companies - India
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