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Tuesday, 19 January 10
COAL FOR DOMESTIC USERS
 While the government is already almost a year behind schedule in issuing regulations to implement the new mining law, mineral producers have been worried about the domestic market obligation (DMO) that the Energy and Mining Resources Ministry imposed through a ruling late last month.
Their concern is not so much about the requirement to allocate a portion of their output to domestic users, but the lack of clarity regarding how the volume of domestic needs for each mineral is set, how the obligation will be distributed among the producers and how the prices will be determined.
Mineral producers (other than oil and natural gas) are fully aware that they should fulfill domestic needs. That requirement is also by and large stipulated in their mining contracts. However, the DMO will create new uncertainty if this obligation is not based on clear-cut regulations.
Unfortunately, the Dec. 31, 2009 decree by the energy and mineral resources minister is mostly about repressive measures for companies failing to meet their DMO. It stipulates that producers who fail to realize their DMO are liable to a 50 percent cut of their output for the following year.
What is encouraging to note is that a similar penalty is also imposed on domestic users failing to take up their annual quota — their annual quota will also be cut by 50 percent. This enforcement is important because the volume of the DMO is based on the domestic market demand, which in turn is based on the annual needs of domestic industrial users each year.
The most affected by the DMO policy are certainly coal producers, who have made Indonesia the world’s largest seaborne exporter of thermal coal with an estimated output of 230 million tons last year, of which only about 50 million tons was used locally. However, the domestic demand for coal is estimated to almost double this year with the coming on stream of several power plants run by state electricity company PT PLN, all fired by coal. They are part of the government’s crash program to build 10,000 megawatts in additional capacity at PLN’s plants.
The government has strived to achieve the right balance between maximizing export revenues from coal and also securing supplies for domestic users. The challenge, though, is how to make producers accept domestic prices as fair compared what they get from exports.
Put another way, there should be an Indonesian coal reference price index that is acceptable to both producers and users, taking into account such factors as the coal’s calorific value, moisture content, etc. Such a reference price index is crucial because, unlike other minerals that have commodity exchanges of their own for price formation, coal doesn’t have any exchange of its own.
In the past, the domestic purchasing price of different grades of coal was often considered arbitrary, which acted as a disincentive for some producers to produce and sell higher-quality coal to PLN, the largest single domestic user.
Commercially, as long as the prices are right, producers will happily sell their output to the domestic market as this will cut the delivery time and freight costs.
The problem, though, is that the latest ministerial decree does not touch at all on a pricing mechanism for the implementation of the domestic market obligation, and this is creating a sense of uncertainty among producers.
Obviously the government needs to address this pricing issue immediately through another clear-cut regulation so as not to adversely affect new investment in the mining sector.
Source: Editorial, The Jakarta Post
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Thursday, 21 January 10
MEC IN TALKS WITH TATA POWER ON COAL - TRADE
The UAE's Middle East Coal is in talks to supply coal to Tata Power, India's biggest private sector power firm, from its new Indonesian operations ...
Wednesday, 20 January 10
NALCO SEEKS CONSULTANT FOR $4 BILLION INDONESIAN SMELTER, PLANT
National Aluminium Co., India’s second-biggest producer of the metal, called for bids for a consultant on its proposed aluminum smelter and co ...
Wednesday, 20 January 10
NTPC PLANS TO SET UP ARM FOR ACQUIRING COAL ASSETS ABROAD
NTPC, the world’s second-largest independent power producer (IPP), plans to set up a new entity for acquiring coal assets abroad to secure fue ...
Wednesday, 20 January 10
CEMENT FIRMS TO BUY POWER PLANT COAL ASH
CEBU, Philippines - Cement companies in Cebu are interested to buy the coal ash that will be produced from the coal-fired power plant in Toledo City ...
Tuesday, 19 January 10
CHINA TO INCREASE THERMAL COAL IMPORTS - WEN
China's Premier Wen Jiabao said on Tuesday that China will appropriately increase imports of thermal coal to ease the country's power shortages.
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- Holcim Trading Pte Ltd - Singapore
- Straits Asia Resources Limited - Singapore
- The University of Queensland
- Therma Luzon, Inc, Philippines
- Jaiprakash Power Ventures ltd
- Kaltim Prima Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- Thiess Contractors Indonesia
- The State Trading Corporation of India Ltd
- CIMB Investment Bank - Malaysia
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Central Electricity Authority - India
- Australian Coal Association
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Semirara Mining and Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The Treasury - Australian Government
- Kepco SPC Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bhatia International Limited - India
- AsiaOL BioFuels Corp., Philippines
- Tamil Nadu electricity Board
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sojitz Corporation - Japan
- Trasteel International SA, Italy
- Eastern Coal Council - USA
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Tata Chemicals Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- Star Paper Mills Limited - India
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- ASAPP Information Group - India
- Eastern Energy - Thailand
- Romanian Commodities Exchange
- Bharathi Cement Corporation - India
- Price Waterhouse Coopers - Russia
- Baramulti Group, Indonesia
- Minerals Council of Australia
- Mintek Dendrill Indonesia
- Makarim & Taira - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- Africa Commodities Group - South Africa
- Videocon Industries ltd - India
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Rio Tinto Coal - Australia
- Jorong Barutama Greston.PT - Indonesia
- Goldman Sachs - Singapore
- Standard Chartered Bank - UAE
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- MS Steel International - UAE
- Australian Commodity Traders Exchange
- Ministry of Finance - Indonesia
- European Bulk Services B.V. - Netherlands
- GAC Shipping (India) Pvt Ltd
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- ICICI Bank Limited - India
- Coalindo Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Meenaskhi Energy Private Limited - India
- Indika Energy - Indonesia
- Independent Power Producers Association of India
- Bhushan Steel Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Sinarmas Energy and Mining - Indonesia
- Meralco Power Generation, Philippines
- Medco Energi Mining Internasional
- Indo Tambangraya Megah - Indonesia
- Orica Australia Pty. Ltd.
- Electricity Generating Authority of Thailand
- GVK Power & Infra Limited - India
- Electricity Authority, New Zealand
- Deloitte Consulting - India
- Coal and Oil Company - UAE
- Kapuas Tunggal Persada - Indonesia
- Interocean Group of Companies - India
- Grasim Industreis Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Global Coal Blending Company Limited - Australia
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- San Jose City I Power Corp, Philippines
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- Borneo Indobara - Indonesia
- Kobexindo Tractors - Indoneisa
- Parry Sugars Refinery, India
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Aditya Birla Group - India
- Siam City Cement - Thailand
- Carbofer General Trading SA - India
- Agrawal Coal Company - India
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- London Commodity Brokers - England
- Toyota Tsusho Corporation, Japan
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Globalindo Alam Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- Banpu Public Company Limited - Thailand
- Pendopo Energi Batubara - Indonesia
- SMC Global Power, Philippines
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Mercator Lines Limited - India
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Edison Trading Spa - Italy
- Wood Mackenzie - Singapore
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- Semirara Mining Corp, Philippines
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- IHS Mccloskey Coal Group - USA
- Bangladesh Power Developement Board
- Merrill Lynch Commodities Europe
- Thai Mozambique Logistica
- Posco Energy - South Korea
- PTC India Limited - India
- Marubeni Corporation - India
- Ind-Barath Power Infra Limited - India
- SMG Consultants - Indonesia
- Indogreen Group - Indonesia
- Indian Oil Corporation Limited
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Planning Commission, India
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- Petron Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Uttam Galva Steels Limited - India
- Attock Cement Pakistan Limited
- Xindia Steels Limited - India
- Commonwealth Bank - Australia
- Kideco Jaya Agung - Indonesia
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PetroVietnam Power Coal Import and Supply Company
- Anglo American - United Kingdom
- Malabar Cements Ltd - India
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Baiduri Energy - Indonesia
- Ministry of Transport, Egypt
- IEA Clean Coal Centre - UK
- Alfred C Toepfer International GmbH - Germany
- PNOC Exploration Corporation - Philippines
- Kumho Petrochemical, South Korea
- Singapore Mercantile Exchange
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Global Green Power PLC Corporation, Philippines
- Economic Council, Georgia
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Sakthi Sugars Limited - India
- CNBM International Corporation - China
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Mjunction Services Limited - India
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