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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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Tuesday, 06 July 10
KEPCO, POSCO BUY AUSTRALIAN COAL MINES - CHOSUN
Chosun reported that, Electricity monopoly KEPCO and steelmaker POSCO have both bought coal mines in Australia.
KEPCO signed a 400 million Austra ...
Tuesday, 06 July 10
SHENHUA GROUPS 2013 PROFIT MAY EXCEED $15 BILLION - BUSINESS WEEK
Business Week reported that, Shenhua Group Corp., China’s biggest coal producer, expects profit to exceed 100 billion yuan ($15 billion) by 20 ...
Saturday, 03 July 10
THE FREIGHT MARKET CONTINUES TO BE UNCERTAIN - CAPT. REDDY
COALspot.com: The market continues to soften and the most affect sector was Panamax which was down by almost 20 pct and closed at 2447 points. The C ...
Friday, 02 July 10
SARDA ENERGY TO ACQUIRE COAL MINES IN INDONESIA
India Info Line reported that, Sarda Energy & Minerals Ltd has announced that the authorities in Indonesia have granted the Environment Cle ...
Friday, 02 July 10
DRY BULK MARKET ON A FREEFALL, REACHING ITS LOWEST IN 9 MONTHS
The Baltic Dry Index is off to break more negative records this week, as the dry bulk shipping industry’s main benchmark has failed to find ro ...
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- International Coal Ventures Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- The University of Queensland
- ICICI Bank Limited - India
- India Bulls Power Limited - India
- Economic Council, Georgia
- Bukit Makmur.PT - Indonesia
- Indian Oil Corporation Limited
- Australian Commodity Traders Exchange
- IEA Clean Coal Centre - UK
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Alfred C Toepfer International GmbH - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Indika Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- Africa Commodities Group - South Africa
- Madhucon Powers Ltd - India
- Semirara Mining Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
- Therma Luzon, Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Barasentosa Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- CIMB Investment Bank - Malaysia
- London Commodity Brokers - England
- Bharathi Cement Corporation - India
- Global Business Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Renaissance Capital - South Africa
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Deloitte Consulting - India
- Kohat Cement Company Ltd. - Pakistan
- Bhushan Steel Limited - India
- Merrill Lynch Commodities Europe
- GMR Energy Limited - India
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Baramulti Group, Indonesia
- TeaM Sual Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Ambuja Cements Ltd - India
- New Zealand Coal & Carbon
- Vijayanagar Sugar Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Aditya Birla Group - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- Price Waterhouse Coopers - Russia
- Energy Link Ltd, New Zealand
- Attock Cement Pakistan Limited
- Kobexindo Tractors - Indoneisa
- Bulk Trading Sa - Switzerland
- Commonwealth Bank - Australia
- Videocon Industries ltd - India
- Coalindo Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Power Finance Corporation Ltd., India
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- Orica Australia Pty. Ltd.
- PTC India Limited - India
- Essar Steel Hazira Ltd - India
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Medco Energi Mining Internasional
- Riau Bara Harum - Indonesia
- Port Waratah Coal Services - Australia
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- SMC Global Power, Philippines
- Parry Sugars Refinery, India
- Kepco SPC Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- Jorong Barutama Greston.PT - Indonesia
- GVK Power & Infra Limited - India
- Planning Commission, India
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Uttam Galva Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Sakthi Sugars Limited - India
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Sical Logistics Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Kideco Jaya Agung - Indonesia
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Ministry of Mines - Canada
- Thai Mozambique Logistica
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- Directorate Of Revenue Intelligence - India
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Georgia Ports Authority, United States
- ASAPP Information Group - India
- Altura Mining Limited, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Samtan Co., Ltd - South Korea
- MS Steel International - UAE
- Globalindo Alam Lestari - Indonesia
- Australian Coal Association
- Indian Energy Exchange, India
- Gujarat Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Eastern Coal Council - USA
- Electricity Generating Authority of Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Cigading International Bulk Terminal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- Jaiprakash Power Ventures ltd
- CNBM International Corporation - China
- Siam City Cement - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Meralco Power Generation, Philippines
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Ministry of Transport, Egypt
- PowerSource Philippines DevCo
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Energy Development Corp, Philippines
- Bhoruka Overseas - Indonesia
- Sojitz Corporation - Japan
- IHS Mccloskey Coal Group - USA
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- Directorate General of MIneral and Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Independent Power Producers Association of India
- Bhatia International Limited - India
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- SN Aboitiz Power Inc, Philippines
- Banpu Public Company Limited - Thailand
- Indogreen Group - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coal and Oil Company - UAE
- Jindal Steel & Power Ltd - India
- Makarim & Taira - Indonesia
- Thiess Contractors Indonesia
- Sree Jayajothi Cements Limited - India
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Carbofer General Trading SA - India
- Borneo Indobara - Indonesia
- Eastern Energy - Thailand
- Vedanta Resources Plc - India
- Timah Investasi Mineral - Indoneisa
- Minerals Council of Australia
- Neyveli Lignite Corporation Ltd, - India
- Interocean Group of Companies - India
- Larsen & Toubro Limited - India
- Karaikal Port Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Maheswari Brothers Coal Limited - India
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Metalloyd Limited - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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