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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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Monday, 28 September 09
TATA POWER SCOUTS FOR COAL BLOCKS ABROAD
Business Standard reported that, private power producer Tata Power is scouting for coal mines abroad, including Australia and Mozambique, to meet de ...
Saturday, 26 September 09
THE INDIA / FAR EAST SEEMS WILL BE FIRM NEXT WEEK - VISTAAR
COALspot.com (Singapore): The dry bulk market was soft this week and the BDI dropped by almost 7 pct to 2,183 points. The cape size index dropped by ...
Saturday, 26 September 09
GSECL PLANS TO PROCURE 15 LAKH (1.5 MILLION) MT OF IMPORTED COAL
Business Standard reported that, State-run power generation company, Gujarat State Electricity Corporation Ltd (GSECL) intends to procure 15 lakh (1 ...
Saturday, 26 September 09
SAIL TO SET UP TWO SLAG-BASED CEMENT MANUFACTURING UNITS
Rediff Business reported that, Government-owned Steel Authority of India Ltd, the country's largest steel producer, is looking to set up two greenf ...
Friday, 25 September 09
INDONESIA STOCK EXCHANGE EXAMINES BUMI DEAL WITH CHINESE SOVEREIGN WEALTH FUND
The Jakarta globe reported that, The Indonesia Stock Exchange is looking into the $1.9 billion financing deal between PT Bumi Resources, the country ...
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- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- Indian Energy Exchange, India
- VISA Power Limited - India
- McConnell Dowell - Australia
- Larsen & Toubro Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Medco Energi Mining Internasional
- Meralco Power Generation, Philippines
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- Rio Tinto Coal - Australia
- Toyota Tsusho Corporation, Japan
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Savvy Resources Ltd - HongKong
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Minerals Council of Australia
- Heidelberg Cement - Germany
- Ministry of Transport, Egypt
- Latin American Coal - Colombia
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Commonwealth Bank - Australia
- Thai Mozambique Logistica
- Globalindo Alam Lestari - Indonesia
- Madhucon Powers Ltd - India
- New Zealand Coal & Carbon
- MS Steel International - UAE
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Parliament of New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Eastern Energy - Thailand
- Aboitiz Power Corporation - Philippines
- Power Finance Corporation Ltd., India
- GMR Energy Limited - India
- Romanian Commodities Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Attock Cement Pakistan Limited
- Interocean Group of Companies - India
- Indonesian Coal Mining Association
- Maharashtra Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Parry Sugars Refinery, India
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- San Jose City I Power Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- Central Java Power - Indonesia
- Wood Mackenzie - Singapore
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Essar Steel Hazira Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Port Waratah Coal Services - Australia
- AsiaOL BioFuels Corp., Philippines
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Uttam Galva Steels Limited - India
- LBH Netherlands Bv - Netherlands
- Mercuria Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- Sarangani Energy Corporation, Philippines
- Anglo American - United Kingdom
- Carbofer General Trading SA - India
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Grasim Industreis Ltd - India
- Bharathi Cement Corporation - India
- Eastern Coal Council - USA
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- Georgia Ports Authority, United States
- Banpu Public Company Limited - Thailand
- The University of Queensland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Dalmia Cement Bharat India
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Chamber of Mines of South Africa
- Bukit Baiduri Energy - Indonesia
- Electricity Generating Authority of Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Standard Chartered Bank - UAE
- Planning Commission, India
- SMC Global Power, Philippines
- Vedanta Resources Plc - India
- Ministry of Mines - Canada
- Siam City Cement - Thailand
- Karaikal Port Pvt Ltd - India
- ASAPP Information Group - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Wilmar Investment Holdings
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kohat Cement Company Ltd. - Pakistan
- Sinarmas Energy and Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Jaiprakash Power Ventures ltd
- Edison Trading Spa - Italy
- Borneo Indobara - Indonesia
- European Bulk Services B.V. - Netherlands
- Merrill Lynch Commodities Europe
- Kobexindo Tractors - Indoneisa
- Samtan Co., Ltd - South Korea
- Antam Resourcindo - Indonesia
- CNBM International Corporation - China
- Semirara Mining and Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- Indika Energy - Indonesia
- Central Electricity Authority - India
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- SMG Consultants - Indonesia
- Ministry of Finance - Indonesia
- TeaM Sual Corporation - Philippines
- Videocon Industries ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Australian Coal Association
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Gujarat Sidhee Cement - India
- Petron Corporation, Philippines
- Vizag Seaport Private Limited - India
- IEA Clean Coal Centre - UK
- Price Waterhouse Coopers - Russia
- PowerSource Philippines DevCo
- Manunggal Multi Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- India Bulls Power Limited - India
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Kepco SPC Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Kapuas Tunggal Persada - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Renaissance Capital - South Africa
- ICICI Bank Limited - India
- Energy Development Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Orica Mining Services - Indonesia
- Kumho Petrochemical, South Korea
- Kaltim Prima Coal - Indonesia
- Simpson Spence & Young - Indonesia
- Lanco Infratech Ltd - India
- Economic Council, Georgia
- Bhatia International Limited - India
- White Energy Company Limited
- Sical Logistics Limited - India
- SN Aboitiz Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Indogreen Group - Indonesia
- Kartika Selabumi Mining - Indonesia
- Star Paper Mills Limited - India
- PTC India Limited - India
- Ceylon Electricity Board - Sri Lanka
- Sojitz Corporation - Japan
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- PNOC Exploration Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Sindya Power Generating Company Private Ltd
- Indo Tambangraya Megah - Indonesia
- Posco Energy - South Korea
- The State Trading Corporation of India Ltd
- Semirara Mining Corp, Philippines
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