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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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Saturday, 19 December 09
THE FUTURES FOR 2010 - 2012 FIRMED UP COMPARED TO LAST WEEK AND WAS AT AROUND CAPE US$ 28,000 PER DAY - VISTAAR
COALspot.com (Singapore): The freight market continued to soften this week with major drop in the cape size index by almost 21 pct and Panamax , Sup ...
Friday, 18 December 09
CARGOTEC WINS IBJ'S BEST SHIP LOADING / UNLOADING SYSTEM AWARD WITH SIWERTELL
Cargotec’s Siwertell ship unloader has recently won International Bulk Journal’s best ship loading/unloading system award for 2009; out ...
Friday, 18 December 09
THERMAL COAL PROJECT MOVES AHEAD
A proposal for Australia's largest thermal coal project in Queensland's central west has taken a step forward.
Hancock Prospecting is proposing ...
Friday, 18 December 09
CHURCHILL MINING COMPLETES FEASIBILITY STUDY FOR EAST KUTAI COAL PROJECT
Churchill Mining Plc has announced the completion of the feasibility study for its flagship project, the 75% held East Kutai coal project in Indones ...
Friday, 18 December 09
COKING COAL SHORTAGE IN CHINA TO SPUR DEMAND FIGHT WITH JAPAN
China, the world’s largest steelmaker, faces a shortage of coking coal that may drive imports next year and spur a fight for resources with Ja ...
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- Kepco SPC Power Corporation, Philippines
- ICICI Bank Limited - India
- Latin American Coal - Colombia
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- Essar Steel Hazira Ltd - India
- Eastern Energy - Thailand
- IEA Clean Coal Centre - UK
- Commonwealth Bank - Australia
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Indika Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Renaissance Capital - South Africa
- GVK Power & Infra Limited - India
- GMR Energy Limited - India
- Barasentosa Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- The University of Queensland
- Mintek Dendrill Indonesia
- Lanco Infratech Ltd - India
- ASAPP Information Group - India
- PNOC Exploration Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Cigading International Bulk Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Xindia Steels Limited - India
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
- Edison Trading Spa - Italy
- Planning Commission, India
- SMC Global Power, Philippines
- Ministry of Transport, Egypt
- Dalmia Cement Bharat India
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Eastern Coal Council - USA
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Semirara Mining Corp, Philippines
- Global Business Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Salva Resources Pvt Ltd - India
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Finance - Indonesia
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Electricity Authority, New Zealand
- Coalindo Energy - Indonesia
- Parry Sugars Refinery, India
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- New Zealand Coal & Carbon
- OPG Power Generation Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Grasim Industreis Ltd - India
- The Treasury - Australian Government
- Tamil Nadu electricity Board
- Bukit Baiduri Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- CNBM International Corporation - China
- Bhatia International Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Orica Australia Pty. Ltd.
- Standard Chartered Bank - UAE
- Oldendorff Carriers - Singapore
- Ind-Barath Power Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Price Waterhouse Coopers - Russia
- Larsen & Toubro Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Energy Link Ltd, New Zealand
- Directorate General of MIneral and Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Economic Council, Georgia
- Sakthi Sugars Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- Bayan Resources Tbk. - Indonesia
- Savvy Resources Ltd - HongKong
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Videocon Industries ltd - India
- Meralco Power Generation, Philippines
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Medco Energi Mining Internasional
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coal and Oil Company - UAE
- Australian Coal Association
- SMG Consultants - Indonesia
- Thai Mozambique Logistica
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- Makarim & Taira - Indonesia
- Sarangani Energy Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Independent Power Producers Association of India
- Sinarmas Energy and Mining - Indonesia
- Malabar Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- European Bulk Services B.V. - Netherlands
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- London Commodity Brokers - England
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Electricity Generating Authority of Thailand
- Deloitte Consulting - India
- Indogreen Group - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Energy Development Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Semirara Mining and Power Corporation, Philippines
- Thiess Contractors Indonesia
- Minerals Council of Australia
- Parliament of New Zealand
- Romanian Commodities Exchange
- Bharathi Cement Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- IHS Mccloskey Coal Group - USA
- Interocean Group of Companies - India
- Siam City Cement - Thailand
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Krishnapatnam Port Company Ltd. - India
- Ceylon Electricity Board - Sri Lanka
- Baramulti Group, Indonesia
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- Port Waratah Coal Services - Australia
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Georgia Ports Authority, United States
- Intertek Mineral Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- PowerSource Philippines DevCo
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Indian Energy Exchange, India
- Jaiprakash Power Ventures ltd
- Globalindo Alam Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- India Bulls Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kobexindo Tractors - Indoneisa
- Sree Jayajothi Cements Limited - India
- Vizag Seaport Private Limited - India
- Ambuja Cements Ltd - India
- Altura Mining Limited, Indonesia
- Mjunction Services Limited - India
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- Indian Oil Corporation Limited
- Attock Cement Pakistan Limited
- Trasteel International SA, Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- TNB Fuel Sdn Bhd - Malaysia
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