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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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- White Energy Company Limited
- Wood Mackenzie - Singapore
- Indian Energy Exchange, India
- Romanian Commodities Exchange
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- Bharathi Cement Corporation - India
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Power Finance Corporation Ltd., India
- Riau Bara Harum - Indonesia
- Tamil Nadu electricity Board
- Karaikal Port Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Electricity Authority, New Zealand
- Goldman Sachs - Singapore
- Bhatia International Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Global Business Power Corporation, Philippines
- ICICI Bank Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Central Java Power - Indonesia
- Orica Australia Pty. Ltd.
- Renaissance Capital - South Africa
- Gujarat Mineral Development Corp Ltd - India
- Thai Mozambique Logistica
- TeaM Sual Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- Sojitz Corporation - Japan
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Parry Sugars Refinery, India
- Price Waterhouse Coopers - Russia
- Asmin Koalindo Tuhup - Indonesia
- Meralco Power Generation, Philippines
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Electricity Generating Authority of Thailand
- Trasteel International SA, Italy
- ASAPP Information Group - India
- Bukit Baiduri Energy - Indonesia
- VISA Power Limited - India
- IHS Mccloskey Coal Group - USA
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- Orica Mining Services - Indonesia
- Bhushan Steel Limited - India
- Parliament of New Zealand
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- Barasentosa Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Malabar Cements Ltd - India
- Kobexindo Tractors - Indoneisa
- Xindia Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Coalindo Energy - Indonesia
- Energy Development Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Singapore Mercantile Exchange
- Savvy Resources Ltd - HongKong
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Aditya Birla Group - India
- Madhucon Powers Ltd - India
- Sakthi Sugars Limited - India
- PNOC Exploration Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Manunggal Multi Energi - Indonesia
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- AsiaOL BioFuels Corp., Philippines
- Minerals Council of Australia
- Intertek Mineral Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Energy Link Ltd, New Zealand
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Essar Steel Hazira Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kapuas Tunggal Persada - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- CNBM International Corporation - China
- Formosa Plastics Group - Taiwan
- Star Paper Mills Limited - India
- Therma Luzon, Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Cement Manufacturers Association - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- Krishnapatnam Port Company Ltd. - India
- Commonwealth Bank - Australia
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- The State Trading Corporation of India Ltd
- South Luzon Thermal Energy Corporation
- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Ministry of Transport, Egypt
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- McConnell Dowell - Australia
- Coal and Oil Company - UAE
- Holcim Trading Pte Ltd - Singapore
- Globalindo Alam Lestari - Indonesia
- Indika Energy - Indonesia
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Kumho Petrochemical, South Korea
- Mercator Lines Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Global Coal Blending Company Limited - Australia
- India Bulls Power Limited - India
- SMG Consultants - Indonesia
- Anglo American - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Pipit Mutiara Jaya. PT, Indonesia
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Larsen & Toubro Limited - India
- Ministry of Mines - Canada
- Ministry of Finance - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Simpson Spence & Young - Indonesia
- Lanco Infratech Ltd - India
- GAC Shipping (India) Pvt Ltd
- Binh Thuan Hamico - Vietnam
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- GMR Energy Limited - India
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- Videocon Industries ltd - India
- Iligan Light & Power Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Marubeni Corporation - India
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Uttam Galva Steels Limited - India
- Chamber of Mines of South Africa
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- Africa Commodities Group - South Africa
- Grasim Industreis Ltd - India
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- CIMB Investment Bank - Malaysia
- Australian Coal Association
- PowerSource Philippines DevCo
- Semirara Mining Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- London Commodity Brokers - England
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Edison Trading Spa - Italy
- Samtan Co., Ltd - South Korea
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Indonesian Coal Mining Association
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Altura Mining Limited, Indonesia
- Rio Tinto Coal - Australia
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
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