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Sunday, 20 June 10
OUR COAL: ITS DEVELOPMENT AND CONTROVERSIAL ISSUES
 Indonesia’s production of coal has been growing amazingly. In the mid 1980s, national coal production was less than 1 million tons per annum, whereas energy planners (in the fourth Five Year Development Plan: 1989-1994) pointed at 10 million tons as the national production target.
The current production has jumped dramatically, recorded as 237 million tons in 2008 (predicted to achieve 270 million tons this year), making Indonesia a world class producer and the largest exporter of coal around the globe. The skyrocketing growth of our coal production has also incited many controversial issues.
Coal is considered as the dirtiest among fossil fuels, making environmentalists oppose their wide use
as fuel.
However, the proposal for ceasing use of coal — power generation, for instance — would be challenged by power utilities demanding low cost fuel that coal may offer and by the government, which has the responsibility to provide electricity as well as have revenue from exploiting its energy resources.
Despite the world’s rising anxiety of global warming, IEA (International Energy Agency: World Energy Outlook 2009) statistics shows that the world consumption for coal, for the last decade, is still growing the fastest among primary energy sources.
The environmental problem associated with coal in Indonesia is not limited to green houses gases (GHG), but also damage and pollution since its exploitation, transportation and uses to post mining.
It is easy to find where many coal fields are not mined appropriately according to “good mining and environmental practices”, coal transportation is not considering safety standards and is damaging rivers, (public) roads and seashores.
The coal mining has polluted the land, water and air of especially Kalimantan, where more than 90 percent of Indonesia’s coal mining operations take place.
It is sad that many of the previous mining areas have been abandoned without being properly reclaimed, whereas thousands of hectares of the island’s tropical forests have been converted into desert.
The soaring exploitation, including its negative impact on the environment, has a strong correlation with the number of licensing/permits awarded.
The introduction of the 1999 Regional Autonomy Law, subsequently followed by the 1999 Fiscal Balancing Law between the Central and Regional Governments have — to some degree — impacted on the coal licensing regime, where larger authorities had been given to regional/local governments.
Under the new licensing regime by local governments, requirements for coal permits tend to be relaxed whereas monitoring has not been done properly.
As a result, the number of permits (Mining Authorization/KP) has been growing considerably (currently 462, of which 169 are producing), coal production increases, but also environmental problems and the issues of illegal mining exist.
The question of who really owns the KP licenses exists, which was defined as that it can be owned by Indonesian national/companies only.
While the largest part of coal in Indonesia are being produced by large companies (the holders of Coal Contract of Work/PKP2B), some coal is mined by small scale and illegal miners.
It is believed that a significant amount of coal has been produced by illegal miners (some 5 million tons annually) and part has gone to meet export demand.
Wherever in the world, illegal miners lack interest in responsible mining and mine rehabilitation practices. Illegal mining is a problem for potential investors, the environment and government revenues.
The government has introduced measures to crack down on problems, including arresting illegal miners.
However, it cannot be the only solution since illegal mining is actually rooted in underemployment, local poverty and weak law enforcement, while the number of people involved in these activities is quite significant.
An alternative to confrontation to illegal miners by the central government (who awards the large scale PKP2B mining license) should be a cooperative and more comprehensive approach.
“Despite the world’s anxiety of global warming, IEA statistics shows that the world consumption for coal is still growing the fastest among primary energy sources.”
Work together with local/rural governments and communities to reduce poverty, educate/assist the illegal miners to increase their awareness on good mining practices (including mine rehabilitation), provide transition period fiscal incentives to encourage illegal mining toward the regulated mining sector, among others.
It needs to maintain an appropriate balance between the soaring exports of coal (about three quarters of production on average) and the domestic growing demand for the same fuel.
Push for exports is still coming largely from the traditional East Asians (Japan is the largest), while the coal-hungry India and China are also increasing their demand for our coal.
The exports will be competed with by the Blue Print for Energy Management 2005-2025 pointing out that one third of Indonesia’s energy primary energy mix in 2025 is to be supplied by coal, (the current share is about 15 percent).
Even though it is often mentioned that our coal reserves are quite large (current proven reserves of 5.5 billion tons; estimated resources of 105 tones) and that our reserves for coal are much larger than that of oil and gas, we should watch their fast rate of exploitation cautiously.
It needs to recalculate the benefit of exploiting them, taking into account their damage to the environment and what is left post mining. Where have all the revenues from exploiting that coal gone? Is the escalating export not jeopardizing the domestic energy security in the near future?
We have ample experiences, for instance in exploiting the resources-rich Kalimantan. The forests, oil and gas reserves have been exploited for about four to five decades, but it seems that the island has not enjoyed the fruits of the excessive exploitation: the current regional economy remains weak, infrastructure is poor and energy supplies for local uses have not been secured.
It needs to promote the terms “resources balance, depletion, sustainability”, start internalizing the costs of environmental impact and enforce those concepts into workable policies for our coal mining development.
The writer is the senior energy planner and an economist with the National Development Planning Agency. The opinions expressed are his own.
Source: The Jakarta Post ( Hanan Nugroho)
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Saturday, 17 July 10
BULLISH OUTLOOK FOR COKING COAL - MINING MX & HELLENIC SHIPPING
Mining Mx reported that, the coking coal market has better long-term fundamentals than the iron ore market, according to a recent research rep ...
Friday, 16 July 10
CHINA EXPORTS 10.14 MILLION TONNES OF COAL IN H1 OF 2010
China exported 10.14 million tonnes of coal in the first half of this year, down 13.1% compared with the corresponding period of last year, accordin ...
Thursday, 15 July 10
SMC TO PURSUE MINDANAO COAL MINING PROJECTS
Philippine Daily Inquirer reported that, DIVERSIFYING CONGLOMERATE San Miguel Corp. is inclined to pursue its coal mining projects in Mindanao ...
Thursday, 15 July 10
ADANI ENTERPRISES WILL BUY $1 BILLION COAL MINE FROM LINC ENERGY - TOP NEWS
Top News reported that, Adani Enterprises has almost managed to obtain a coal mine from Linc Energy for $1 billion in Queensland, Australia. This mi ...
Thursday, 15 July 10
ADANI TO DEVELOP COAL EXPORT TERMINAL IN AUSTRALIA - BUSINESS STANDARD
Business-Standard reported that, The Adani Group, promoter of Mundra Port and Special Economic Zone (MPSEZ), today said it has been selected as the ...
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- Directorate General of MIneral and Coal - Indonesia
- Bulk Trading Sa - Switzerland
- Mintek Dendrill Indonesia
- Simpson Spence & Young - Indonesia
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chamber of Mines of South Africa
- Global Business Power Corporation, Philippines
- Interocean Group of Companies - India
- McConnell Dowell - Australia
- VISA Power Limited - India
- Ministry of Finance - Indonesia
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Larsen & Toubro Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Attock Cement Pakistan Limited
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- The University of Queensland
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- SMC Global Power, Philippines
- Uttam Galva Steels Limited - India
- GMR Energy Limited - India
- Anglo American - United Kingdom
- Siam City Cement - Thailand
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- New Zealand Coal & Carbon
- Therma Luzon, Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Pendopo Energi Batubara - Indonesia
- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Commonwealth Bank - Australia
- CIMB Investment Bank - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- Jaiprakash Power Ventures ltd
- Ministry of Mines - Canada
- Kartika Selabumi Mining - Indonesia
- Tamil Nadu electricity Board
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Tata Chemicals Ltd - India
- Australian Coal Association
- Petron Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Orica Australia Pty. Ltd.
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- Ceylon Electricity Board - Sri Lanka
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Kideco Jaya Agung - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Makarim & Taira - Indonesia
- Kepco SPC Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Eastern Energy - Thailand
- Singapore Mercantile Exchange
- Sakthi Sugars Limited - India
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- London Commodity Brokers - England
- White Energy Company Limited
- Posco Energy - South Korea
- Carbofer General Trading SA - India
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- Minerals Council of Australia
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- European Bulk Services B.V. - Netherlands
- Metalloyd Limited - United Kingdom
- Kumho Petrochemical, South Korea
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- PTC India Limited - India
- LBH Netherlands Bv - Netherlands
- Savvy Resources Ltd - HongKong
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Binh Thuan Hamico - Vietnam
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- ASAPP Information Group - India
- Rashtriya Ispat Nigam Limited - India
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- GAC Shipping (India) Pvt Ltd
- The State Trading Corporation of India Ltd
- Indian Oil Corporation Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Indian Energy Exchange, India
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Ministry of Transport, Egypt
- Borneo Indobara - Indonesia
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Mercator Lines Limited - India
- Bhushan Steel Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Jindal Steel & Power Ltd - India
- TeaM Sual Corporation - Philippines
- Power Finance Corporation Ltd., India
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- MS Steel International - UAE
- The Treasury - Australian Government
- ICICI Bank Limited - India
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
- Planning Commission, India
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- Essar Steel Hazira Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- Wood Mackenzie - Singapore
- Baramulti Group, Indonesia
- CNBM International Corporation - China
- PNOC Exploration Corporation - Philippines
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Thiess Contractors Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Antam Resourcindo - Indonesia
- India Bulls Power Limited - India
- Renaissance Capital - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Edison Trading Spa - Italy
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Coal Blending Company Limited - Australia
- Vizag Seaport Private Limited - India
- Xindia Steels Limited - India
- Dalmia Cement Bharat India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Neyveli Lignite Corporation Ltd, - India
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- Formosa Plastics Group - Taiwan
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Economic Council, Georgia
- Bharathi Cement Corporation - India
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Bangladesh Power Developement Board
- Sindya Power Generating Company Private Ltd
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Kaltim Prima Coal - Indonesia
- Mercuria Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Semirara Mining Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Romanian Commodities Exchange
- Heidelberg Cement - Germany
- Sojitz Corporation - Japan
- Wilmar Investment Holdings
- Barasentosa Lestari - Indonesia
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