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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, 26 June 10
MONGOLIA COAL RAILWAY TO LINK WITH RUSSIA - BUSINESS WEEK
Business Week reported that, Mongolian lawmakers have approved plans for a rail line linking with Russia to help tap large coal deposits in the sout ...
Friday, 25 June 10
INDIAS THIRD-LARGEST SHIPPING COMPANY BAGS US$ 31 MILLION DEAL WITH SL
Daily Mirror reported that, Mainboard-listed and India-owned dry bulk shipping firm Mercator Lines says it has won a US$ 31 million contract in Sri ...
Friday, 25 June 10
DEMAND FOR COAL COULD BE GRADUALLY RETURNING - FEARNBULK
Handy
Atlantic markets seeing more activity today (23 June 2010) after a slump the last weeks. Supramax vessels open in USG are achieving low/mid ...
Thursday, 24 June 10
INDONESIAS BUMI DECLARED US$ 57.1 MILLION (AMOUNTING TO 30% OF 2009 NET INCOME) AS DIVIDEND
COALspot.com: PT Bumi Resources, Tbk’s Annual General Meeting (AGM) today was successfully held with a quorum of 75.89% resulting in sharehold ...
Thursday, 24 June 10
CHINA TARGETS 3.6 BILLION MT ANNUAL COAL OUTPUT FOR 2015
At a forum in Beijing entitled "Chinese energy strategy and energy development in the 12th five-year plan period (2011-2015)", He Youguo, ...
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- Kideco Jaya Agung - Indonesia
- Medco Energi Mining Internasional
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- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maheswari Brothers Coal Limited - India
- McConnell Dowell - Australia
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- Indika Energy - Indonesia
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
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- Bukit Asam (Persero) Tbk - Indonesia
- TeaM Sual Corporation - Philippines
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- Standard Chartered Bank - UAE
- CNBM International Corporation - China
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- GVK Power & Infra Limited - India
- Trasteel International SA, Italy
- Sarangani Energy Corporation, Philippines
- Anglo American - United Kingdom
- Sakthi Sugars Limited - India
- Central Java Power - Indonesia
- Goldman Sachs - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Romanian Commodities Exchange
- VISA Power Limited - India
- Meenaskhi Energy Private Limited - India
- Sindya Power Generating Company Private Ltd
- Straits Asia Resources Limited - Singapore
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- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Bhoruka Overseas - Indonesia
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- Lanco Infratech Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Edison Trading Spa - Italy
- Indonesian Coal Mining Association
- Planning Commission, India
- Posco Energy - South Korea
- Ind-Barath Power Infra Limited - India
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Merrill Lynch Commodities Europe
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- AsiaOL BioFuels Corp., Philippines
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Port Waratah Coal Services - Australia
- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- Iligan Light & Power Inc, Philippines
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- Energy Link Ltd, New Zealand
- Bharathi Cement Corporation - India
- MS Steel International - UAE
- Latin American Coal - Colombia
- PTC India Limited - India
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- Aditya Birla Group - India
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- Energy Development Corp, Philippines
- Banpu Public Company Limited - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meralco Power Generation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Chettinad Cement Corporation Ltd - India
- International Coal Ventures Pvt Ltd - India
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Marubeni Corporation - India
- Simpson Spence & Young - Indonesia
- Economic Council, Georgia
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- White Energy Company Limited
- Semirara Mining Corp, Philippines
- Eastern Coal Council - USA
- IEA Clean Coal Centre - UK
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- GMR Energy Limited - India
- Jaiprakash Power Ventures ltd
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- Ceylon Electricity Board - Sri Lanka
- Madhucon Powers Ltd - India
- ASAPP Information Group - India
- Leighton Contractors Pty Ltd - Australia
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Wood Mackenzie - Singapore
- Ministry of Mines - Canada
- Bhushan Steel Limited - India
- Parliament of New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Renaissance Capital - South Africa
- PetroVietnam Power Coal Import and Supply Company
- SMC Global Power, Philippines
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Attock Cement Pakistan Limited
- Siam City Cement - Thailand
- The University of Queensland
- Thiess Contractors Indonesia
- Vedanta Resources Plc - India
- Ambuja Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Global Coal Blending Company Limited - Australia
- ICICI Bank Limited - India
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- Global Business Power Corporation, Philippines
- Australian Coal Association
- Billiton Holdings Pty Ltd - Australia
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- London Commodity Brokers - England
- Power Finance Corporation Ltd., India
- Krishnapatnam Port Company Ltd. - India
- Timah Investasi Mineral - Indoneisa
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- New Zealand Coal & Carbon
- Karaikal Port Pvt Ltd - India
- Coal and Oil Company - UAE
- Tata Chemicals Ltd - India
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Aboitiz Power Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Barasentosa Lestari - Indonesia
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- Eastern Energy - Thailand
- Savvy Resources Ltd - HongKong
- Karbindo Abesyapradhi - Indoneisa
- Orica Australia Pty. Ltd.
- Mercator Lines Limited - India
- Manunggal Multi Energi - Indonesia
- Singapore Mercantile Exchange
- Makarim & Taira - Indonesia
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- The State Trading Corporation of India Ltd
- San Jose City I Power Corp, Philippines
- Orica Mining Services - Indonesia
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Holcim Trading Pte Ltd - Singapore
- Gujarat Sidhee Cement - India
- The Treasury - Australian Government
- Coastal Gujarat Power Limited - India
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Price Waterhouse Coopers - Russia
- Sical Logistics Limited - India
- Semirara Mining and Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Minerals Council of Australia
- Baramulti Group, Indonesia
- Essar Steel Hazira Ltd - India
- Siam City Cement PLC, Thailand
- Carbofer General Trading SA - India
- Thai Mozambique Logistica
- SN Aboitiz Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Deloitte Consulting - India
- Maharashtra Electricity Regulatory Commission - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Central Electricity Authority - India
- Bangladesh Power Developement Board
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- Mjunction Services Limited - India
- CIMB Investment Bank - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Ministry of Finance - Indonesia
- Xindia Steels Limited - India
- Africa Commodities Group - South Africa
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