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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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Friday, 23 October 09
AUSTRALIA APPROVES CHINESE TAKEOVER OF FELIX RESOURCES
* Australia give conditional approval to China's Felix deal
* Chinese owner must list the assets on Australian exchange
Reuters reported that, ...
Friday, 23 October 09
IVANHOE TARGETING 20 MILLION TONS OF COAL OUTPUT IN MONGOLIA
Bloomberg reported that, Ivanhoe Mines Ltd., developing a $4 billion copper and gold mine in Mongolia with Rio Tinto Group, is targeting long-term c ...
Friday, 23 October 09
XSTRATA PLANS $1BN AUSTRALIAN COAL PORT
Xstrata Plc, the world's biggest exporter of steam coal, plans to build a new $1 billion coal port in Australia, it said.
The proposed Balaclava ...
Friday, 23 October 09
MEXICO'S CFE SEEKS 6.24 MLN T COAL FOR 2010-12
Reuters reported that, Mexico's state-owned power monopoly plans to award a tender for 6.24 million tonnes of steam coal in December, according to ...
Friday, 23 October 09
CIL PRICE HIKE LIKELY TO PUSH POWER RATES UP
Business-Standard reported that, May squeeze cement companies’ margins, but the steel sector is unlikely to be affected much.
The upward re ...
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- OPG Power Generation Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
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- Jaiprakash Power Ventures ltd
- Attock Cement Pakistan Limited
- The State Trading Corporation of India Ltd
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Indonesian Coal Mining Association
- Aditya Birla Group - India
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- ICICI Bank Limited - India
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Samtan Co., Ltd - South Korea
- Bangladesh Power Developement Board
- Commonwealth Bank - Australia
- Central Java Power - Indonesia
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Miang Besar Coal Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Singapore Mercantile Exchange
- Maheswari Brothers Coal Limited - India
- Latin American Coal - Colombia
- New Zealand Coal & Carbon
- Standard Chartered Bank - UAE
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Rio Tinto Coal - Australia
- The Treasury - Australian Government
- Ministry of Mines - Canada
- Power Finance Corporation Ltd., India
- Orica Mining Services - Indonesia
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Riau Bara Harum - Indonesia
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Bulk Trading Sa - Switzerland
- Globalindo Alam Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Grasim Industreis Ltd - India
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- IHS Mccloskey Coal Group - USA
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Economic Council, Georgia
- Parliament of New Zealand
- Posco Energy - South Korea
- Ministry of Transport, Egypt
- Renaissance Capital - South Africa
- Anglo American - United Kingdom
- Eastern Energy - Thailand
- Xindia Steels Limited - India
- Gujarat Sidhee Cement - India
- Simpson Spence & Young - Indonesia
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- Deloitte Consulting - India
- SMC Global Power, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Therma Luzon, Inc, Philippines
- Agrawal Coal Company - India
- PTC India Limited - India
- Ind-Barath Power Infra Limited - India
- Videocon Industries ltd - India
- Coal and Oil Company - UAE
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- Holcim Trading Pte Ltd - Singapore
- Minerals Council of Australia
- LBH Netherlands Bv - Netherlands
- Australian Commodity Traders Exchange
- Leighton Contractors Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Toyota Tsusho Corporation, Japan
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Billiton Holdings Pty Ltd - Australia
- Bharathi Cement Corporation - India
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Eastern Coal Council - USA
- Semirara Mining and Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Star Paper Mills Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Parry Sugars Refinery, India
- Krishnapatnam Port Company Ltd. - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMG Consultants - Indonesia
- Sinarmas Energy and Mining - Indonesia
- IEA Clean Coal Centre - UK
- Mjunction Services Limited - India
- Coalindo Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Uttam Galva Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- Karaikal Port Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Mintek Dendrill Indonesia
- Vedanta Resources Plc - India
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Wood Mackenzie - Singapore
- CIMB Investment Bank - Malaysia
- Coastal Gujarat Power Limited - India
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Oldendorff Carriers - Singapore
- Goldman Sachs - Singapore
- Kumho Petrochemical, South Korea
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- Medco Energi Mining Internasional
- Salva Resources Pvt Ltd - India
- Independent Power Producers Association of India
- Sojitz Corporation - Japan
- Formosa Plastics Group - Taiwan
- Energy Development Corp, Philippines
- Antam Resourcindo - Indonesia
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Planning Commission, India
- Timah Investasi Mineral - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Thiess Contractors Indonesia
- McConnell Dowell - Australia
- VISA Power Limited - India
- TeaM Sual Corporation - Philippines
- Cement Manufacturers Association - India
- Thai Mozambique Logistica
- The University of Queensland
- PetroVietnam Power Coal Import and Supply Company
- Sindya Power Generating Company Private Ltd
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Baramulti Group, Indonesia
- London Commodity Brokers - England
- Global Green Power PLC Corporation, Philippines
- Georgia Ports Authority, United States
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- Lanco Infratech Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Baiduri Energy - Indonesia
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Electricity Authority, New Zealand
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Global Coal Blending Company Limited - Australia
- Metalloyd Limited - United Kingdom
- Heidelberg Cement - Germany
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Vijayanagar Sugar Pvt Ltd - India
- Indika Energy - Indonesia
- Vizag Seaport Private Limited - India
- Trasteel International SA, Italy
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Africa Commodities Group - South Africa
- Dalmia Cement Bharat India
- Bhushan Steel Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Global Business Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Aboitiz Power Corporation - Philippines
- Interocean Group of Companies - India
- Directorate General of MIneral and Coal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate Of Revenue Intelligence - India
- GMR Energy Limited - India
- Orica Australia Pty. Ltd.
- Wilmar Investment Holdings
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Mercator Lines Limited - India
- Sical Logistics Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Mineral Development Corp Ltd - India
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