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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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Friday, 04 December 09
JSW ENERGY TO BUY OUT PARENT FIRM'S COAL BLOCK
JSW Energy plans to buy the stake held by JSW Steel in a thermal coal block in Mozambique in an attempt to become an integrated energy company with ...
Thursday, 03 December 09
JAPAN 2010 COAL IMPORTS SEEN FLAT, INDIA'S ROBUST - INDUSTRY
* Japan's demand seen steady in 2010 at 110 mln tonnes
* India's demand seen as robust, at 70 mln tonnes
Reuters reported that, Thermal coal i ...
Thursday, 03 December 09
INDONESIA MAY ALLOW COAL SALES BELOW GOVT PRICE
Reuters reported that, Indonesia is considering giving producers some flexibility to sell coal below the government's monthly benchmark price to co ...
Thursday, 03 December 09
INDONESIA SEEKS TO INCREASE COAL SHIPMENTS TO INDIA, CHINA
Bloomberg reproted that, Indonesia, Asia’s biggest coal exporter, seeks to increase shipments to India and China as the economies improve and ...
Thursday, 03 December 09
COAL INDIA IPO LIKELY TO HIT MARKETS BY NOVEMBER 2010
Soon investors will get to own a slice of India's largest coal mining company. Coal India its initial public offering will hit markets in November ...
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- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mintek Dendrill Indonesia
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Mercuria Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Planning Commission, India
- Xindia Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Central Java Power - Indonesia
- Kobexindo Tractors - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Vedanta Resources Plc - India
- Energy Development Corp, Philippines
- Eastern Energy - Thailand
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- Wilmar Investment Holdings
- Makarim & Taira - Indonesia
- Chamber of Mines of South Africa
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
- PetroVietnam Power Coal Import and Supply Company
- Port Waratah Coal Services - Australia
- Ceylon Electricity Board - Sri Lanka
- SMG Consultants - Indonesia
- IHS Mccloskey Coal Group - USA
- Ind-Barath Power Infra Limited - India
- Semirara Mining Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Baramulti Group, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Barasentosa Lestari - Indonesia
- Sical Logistics Limited - India
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Siam City Cement - Thailand
- Toyota Tsusho Corporation, Japan
- Romanian Commodities Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- Jaiprakash Power Ventures ltd
- White Energy Company Limited
- Indika Energy - Indonesia
- Sakthi Sugars Limited - India
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Alfred C Toepfer International GmbH - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meralco Power Generation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- India Bulls Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Tata Chemicals Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Medco Energi Mining Internasional
- SMC Global Power, Philippines
- Tamil Nadu electricity Board
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- Simpson Spence & Young - Indonesia
- Chettinad Cement Corporation Ltd - India
- Gujarat Sidhee Cement - India
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Bharathi Cement Corporation - India
- ICICI Bank Limited - India
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Ministry of Finance - Indonesia
- PTC India Limited - India
- Vizag Seaport Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- The University of Queensland
- Kumho Petrochemical, South Korea
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Bhoruka Overseas - Indonesia
- MS Steel International - UAE
- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Goldman Sachs - Singapore
- Parliament of New Zealand
- Central Electricity Authority - India
- Intertek Mineral Services - Indonesia
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- PowerSource Philippines DevCo
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Singapore Mercantile Exchange
- Eastern Coal Council - USA
- The State Trading Corporation of India Ltd
- Global Green Power PLC Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Petron Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Mercator Lines Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- Coal and Oil Company - UAE
- New Zealand Coal & Carbon
- Bukit Baiduri Energy - Indonesia
- Thai Mozambique Logistica
- Mjunction Services Limited - India
- Attock Cement Pakistan Limited
- Malabar Cements Ltd - India
- Anglo American - United Kingdom
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Latin American Coal - Colombia
- Offshore Bulk Terminal Pte Ltd, Singapore
- London Commodity Brokers - England
- Siam City Cement PLC, Thailand
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Australian Coal Association
- Kohat Cement Company Ltd. - Pakistan
- AsiaOL BioFuels Corp., Philippines
- Bhushan Steel Limited - India
- TeaM Sual Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Sojitz Corporation - Japan
- Economic Council, Georgia
- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Grasim Industreis Ltd - India
- Samtan Co., Ltd - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Iligan Light & Power Inc, Philippines
- VISA Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Thiess Contractors Indonesia
- Edison Trading Spa - Italy
- LBH Netherlands Bv - Netherlands
- Metalloyd Limited - United Kingdom
- Price Waterhouse Coopers - Russia
- Karbindo Abesyapradhi - Indoneisa
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Indonesian Coal Mining Association
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aditya Birla Group - India
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Banpu Public Company Limited - Thailand
- Savvy Resources Ltd - HongKong
- Electricity Authority, New Zealand
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Wood Mackenzie - Singapore
- Riau Bara Harum - Indonesia
- Global Coal Blending Company Limited - Australia
- Africa Commodities Group - South Africa
- Star Paper Mills Limited - India
- Rashtriya Ispat Nigam Limited - India
- Interocean Group of Companies - India
- Cement Manufacturers Association - India
- Kartika Selabumi Mining - Indonesia
- SN Aboitiz Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Heidelberg Cement - Germany
- Bhatia International Limited - India
- Marubeni Corporation - India
- Georgia Ports Authority, United States
- Bahari Cakrawala Sebuku - Indonesia
- Trasteel International SA, Italy
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Deloitte Consulting - India
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Timah Investasi Mineral - Indoneisa
- Standard Chartered Bank - UAE
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- Global Business Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Manunggal Multi Energi - Indonesia
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