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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, 19 June 10
STRONG DEMAND, RISING PRODUCTION SETTING SCENE FOR COAL BONANZA - THE JAKARTA GLOBE
The Jakarta globe rerported that, As the nation’s coal miners enjoy burgeoning demand from energy-hungry economies such as China and India, th ...
Saturday, 19 June 10
DRY BULK MARKET DOWN ON CHINESE SLOWDOWN FEARS
Dry bulk freight rates have been on a freefall for more than two weeks now, something which has caused the industry’s benchmark, the Baltic Dr ...
Saturday, 19 June 10
COAL INDIA KEEN ON BLOCK DEVELOPMENT IN INDONESIA - THE HINDU BUSINESS LINE
Expanding horizon
Agreement by the Indonesian Government is likely to help CIL gain foothold in India's largest sourcing point of thermal coal.
...
Friday, 18 June 10
THE PANAMAX MARKET CONTINUED ITS SOFTENING TREND - FEARNBULK
Handy
Flat Atlantic markets with most markets in ´slow mode´ due to holidays in China.
Supramax vessels open in the USG are achievi ...
Thursday, 17 June 10
INDONESIAN COAL PRICE REFERENCE FOR JUNE IS US$ 97.22/TON UP 5.59 PERCENT
COALspot.com: The directorate general of mineral, coal and geothermal of Indonesia has been publishing a monthly coal price reference (HBA) to be us ...
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- Oldendorff Carriers - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- Bayan Resources Tbk. - Indonesia
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Minerals Council of Australia
- Commonwealth Bank - Australia
- Africa Commodities Group - South Africa
- Port Waratah Coal Services - Australia
- Globalindo Alam Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- OPG Power Generation Pvt Ltd - India
- Marubeni Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Gujarat Sidhee Cement - India
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Wilmar Investment Holdings
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Standard Chartered Bank - UAE
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Eastern Energy - Thailand
- Electricity Authority, New Zealand
- Cement Manufacturers Association - India
- Renaissance Capital - South Africa
- The University of Queensland
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Australian Coal Association
- Ind-Barath Power Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Siam City Cement - Thailand
- Maheswari Brothers Coal Limited - India
- IEA Clean Coal Centre - UK
- London Commodity Brokers - England
- Directorate General of MIneral and Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- SMC Global Power, Philippines
- Mercator Lines Limited - India
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Bhushan Steel Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Mines - Canada
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- Jindal Steel & Power Ltd - India
- India Bulls Power Limited - India
- Electricity Generating Authority of Thailand
- Manunggal Multi Energi - Indonesia
- Australian Commodity Traders Exchange
- Formosa Plastics Group - Taiwan
- Vizag Seaport Private Limited - India
- Planning Commission, India
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Sakthi Sugars Limited - India
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- ICICI Bank Limited - India
- Vedanta Resources Plc - India
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- Petron Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Toyota Tsusho Corporation, Japan
- Uttam Galva Steels Limited - India
- Power Finance Corporation Ltd., India
- Parry Sugars Refinery, India
- McConnell Dowell - Australia
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Indogreen Group - Indonesia
- Aditya Birla Group - India
- Kobexindo Tractors - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- PowerSource Philippines DevCo
- Kaltim Prima Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- TeaM Sual Corporation - Philippines
- SMG Consultants - Indonesia
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Global Coal Blending Company Limited - Australia
- Maharashtra Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- MS Steel International - UAE
- Merrill Lynch Commodities Europe
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Goldman Sachs - Singapore
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- Tata Chemicals Ltd - India
- Chettinad Cement Corporation Ltd - India
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Sinarmas Energy and Mining - Indonesia
- Rio Tinto Coal - Australia
- Bhatia International Limited - India
- Semirara Mining and Power Corporation, Philippines
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Ministry of Finance - Indonesia
- VISA Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- CIMB Investment Bank - Malaysia
- Mjunction Services Limited - India
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- Jaiprakash Power Ventures ltd
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Videocon Industries ltd - India
- Antam Resourcindo - Indonesia
- Eastern Coal Council - USA
- San Jose City I Power Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Independent Power Producers Association of India
- Heidelberg Cement - Germany
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Simpson Spence & Young - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Anglo American - United Kingdom
- SN Aboitiz Power Inc, Philippines
- White Energy Company Limited
- Ambuja Cements Ltd - India
- Riau Bara Harum - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Tamil Nadu electricity Board
- Krishnapatnam Port Company Ltd. - India
- Kartika Selabumi Mining - Indonesia
- Trasteel International SA, Italy
- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- PetroVietnam Power Coal Import and Supply Company
- South Luzon Thermal Energy Corporation
- Malabar Cements Ltd - India
- Sical Logistics Limited - India
- Therma Luzon, Inc, Philippines
- Medco Energi Mining Internasional
- Indian Oil Corporation Limited
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- Bukit Makmur.PT - Indonesia
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