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Tuesday, 06 September 11
INDONESIAS PROPOSED COAL EXPORT BAN MAY HAVE IMPACT ON THE INDIAN POWER SECTOR - DIPESH DIPU
.jpg) COALspot.com - This is a special interview about Indonesian proposed coal export ban by 2014, with Mr. Dipesh Dipu, Director of Deloitte Touche Tohmatsu, India.
The Indonesian government is currently in the process of drafting a new regulation that could ban the export of low-grade coal by January 12, 2014. This is likely to apply to coal below 5700 kcal/kg on air dried basis in value.
As of now Indonesia is producing around 150 million tons of coal with calorific value below 5700 GAD (according to chairman of Indonesian coal mining association). However by 2014, there are possibilities the total production of below 5700 GAD coal may reach more than 200 million per annum.
Will Indonesian coal export ban impact on the Indian fuel requirements?
The earlier grade of coal that was being considered for proposed ban has GCV of 5100 kcal/kg of less (adb), which can be comparable to 3800-4200 kcal/kg (arb) domestic coal available in India. This grade of coal has found favor in India primarily due to likely price advantage but economics of power generation based on such grade of imported coal may be a suspect. This considering that such grades of coal from Indonesia typically have high moisture content, which makes transportation cost per unit of energy generated higher. The quantum of the low grade of coal (<5100 kcal/kg adb) procured from Indonesia is likely to remain relatively low.
However, if the new definition of low grade coal is applied (<5700 kcal/kg adb), it may be reasonable to believe that such a ban may have impact on the Indian power sector as volumes in this grade of coal are expected to rise in the proportion of coal exports to India. Several of the acquisitions made by Indian power generation companies in Indonesia have been in coal blocks that will produce coal of this grade, and a blanket ban on the exports can jeopardize power plant development in India.
On the other hand, the domestic Indonesian market may not be prepared to consume all the coal mined of this grade in view of the power generation capacity addition plans in Indonesia. In such a case, the coal mine development is likely to be deferred. The Indonesian law makers may need to reconsider domestic market demand, investment climate in coal sector and impact of the legislation on the export revenues.
What is the alternative source for Indian power industry if the proposed coal export ban come into effect by 2014?
Indian power generation companies have been forced to look out for coal assets abroad due to the investment and regulatory environment within the country. India boasts of more than 110 billion tonnes of coal reserves, which largely fall within a 300 meters of depth. If the regulatory and investment environment is amended to allow greater participation of private sector Indian dependence on imports will be reduced.
However, for imports, India will continue to look at Indonesia, South Africa, Australia and newer destinations like Mozambique and Columbia. But these sources also have constraints, domestic demands in South Africa is likely to restrict quantum jump in exports out of South Africa. Indonesia has also proposed domestic market obligations. Mozambique may have infrastructure constraints for large volumes of coal being transported from Tete province to ports of Maputo, Ncala or Beira. Australian coal is of high quality but may have higher costs of mining and transport.
What would be the additional cost if Indian consumers switch their sourcing origin from Indonesia?
Indonesia has competitive advantage due to its geographical closeness. However, on a per tonne basis, assuming comparable quality, costs of transport may make marginal difference when compared with South Africa and Mozambique.
When compared to Australian coal, due to the high quality, cost of energy may well be comparable even though shipping costs are higher. Between Indonesian coal (5500 kcal/kg adb priced at USD 90 per tonne) and Australian coal (6500 kcal/kg adb priced at USD 120 per tonne), indicative variable cost difference of power generation may be about Indian Rupees 0.20 to 0.30 per kWh (electricity unit) in favor of Indonesian coal.
Will it affect Indian economy growth or this coal export ban is ignorable as India can easily identify alternative sources of fuel?
The magnitude of growth in power generation in India will necessarily mean that coal will remain the mainstay. Natural gas has had issues of availability. Nuclear plant development is facing socio-political challenge in view of the risks of technology failure. Development of hydel power has also faced issues of land acquisition, rehabilitation & resettlement apart from the technical issues of hydro-geological features. Renewable sources such as solar and wind generation are still projected to constitute a small portion of India power generation mix. Identifying an alternative source that can match coal in its accessibility, availability and affordability in the context of scale of capacity addition required in India is a challenge.
What is the Indian government's role on this issue, whether government has to come out with the solution such as easing Indian mining and environment law, open up mining for foreigners, G2G arrangement, etc…?
There is a need to look at domestic sources with pro-active and constructive approach and make all necessary legal and statutory amendments that make the resources available and mineable. Easing the regulations may not be one of such measures but making those regulations work in sync with each other in a time bound and predictable manner must certainly be.
There is certainly a case for opening the domestic coal sector for private participation, including independent miners, and for foreign participation so that newer technology and enhanced scale of operations are implemented in India. The regulation also needs to permit risk capital to come in for prospecting and exploration.
For imports the G2G relations can be leveraged to secure coal assets. India has good relationship with Indonesia and has also signed a tax treaty with Mozambique in 2010 which will facilitate investments. Government may also engage with these countries to ease exports to India and extend fiscal support to coal mining companies investing in mining and associated infrastructure development.
About Dipesh Dipu
Dipesh Dipu works as Director with Deloitte Touche Tohmatsu India Pvt. Ltd in the Energy and Resources consulting practice of the firm and anchors the Firm’s initiative in the mining and metals sectors.
He is a mining engineering graduate from Indian School of Mines and is a Chartered Financial Analyst (CFA). He has also done executive program in business management from Indian Institute of Management Calcutta. Dipesh has recently been awarded the Abheraj Baldota Gold Medal for the Young Mining Engineer of the Year 2007 by the Mining Engineers’ Association of India in recognition of his contributions in the improvement of mining industry in India.
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Tuesday, 07 April 20
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Showing 1026 to 1030 news of total 6871 |
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Iligan Light & Power Inc, Philippines
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
- Videocon Industries ltd - India
- Eastern Coal Council - USA
- Intertek Mineral Services - Indonesia
- Kepco SPC Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- The Treasury - Australian Government
- Kaltim Prima Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Pendopo Energi Batubara - Indonesia
- Port Waratah Coal Services - Australia
- Kohat Cement Company Ltd. - Pakistan
- San Jose City I Power Corp, Philippines
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Marubeni Corporation - India
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- India Bulls Power Limited - India
- Ministry of Finance - Indonesia
- Global Business Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- Planning Commission, India
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- Ambuja Cements Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Manunggal Multi Energi - Indonesia
- Tata Chemicals Ltd - India
- Bukit Makmur.PT - Indonesia
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- Larsen & Toubro Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- The University of Queensland
- Goldman Sachs - Singapore
- Economic Council, Georgia
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Kobexindo Tractors - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Oldendorff Carriers - Singapore
- Wilmar Investment Holdings
- Posco Energy - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Oil Corporation Limited
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Semirara Mining Corp, Philippines
- Thai Mozambique Logistica
- Therma Luzon, Inc, Philippines
- Electricity Authority, New Zealand
- Siam City Cement - Thailand
- Billiton Holdings Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- CNBM International Corporation - China
- Altura Mining Limited, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Neyveli Lignite Corporation Ltd, - India
- Tamil Nadu electricity Board
- Sarangani Energy Corporation, Philippines
- Minerals Council of Australia
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Ministry of Mines - Canada
- CIMB Investment Bank - Malaysia
- Maheswari Brothers Coal Limited - India
- Kideco Jaya Agung - Indonesia
- SN Aboitiz Power Inc, Philippines
- Merrill Lynch Commodities Europe
- Karaikal Port Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Riau Bara Harum - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Vizag Seaport Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Kapuas Tunggal Persada - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- PTC India Limited - India
- Thiess Contractors Indonesia
- ICICI Bank Limited - India
- Rio Tinto Coal - Australia
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- Gujarat Sidhee Cement - India
- Simpson Spence & Young - Indonesia
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- International Coal Ventures Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Kalimantan Lumbung Energi - Indonesia
- White Energy Company Limited
- Kumho Petrochemical, South Korea
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Mercuria Energy - Indonesia
- Bulk Trading Sa - Switzerland
- LBH Netherlands Bv - Netherlands
- OPG Power Generation Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Holcim Trading Pte Ltd - Singapore
- GVK Power & Infra Limited - India
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Development Corp, Philippines
- Xindia Steels Limited - India
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Energy Exchange, India
- Vijayanagar Sugar Pvt Ltd - India
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Trasteel International SA, Italy
- Heidelberg Cement - Germany
- TNB Fuel Sdn Bhd - Malaysia
- GMR Energy Limited - India
- Bukit Baiduri Energy - Indonesia
- Central Electricity Authority - India
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- Directorate Of Revenue Intelligence - India
- Meenaskhi Energy Private Limited - India
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- Kartika Selabumi Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Australian Commodity Traders Exchange
- Coal and Oil Company - UAE
- Electricity Generating Authority of Thailand
- Madhucon Powers Ltd - India
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- Global Coal Blending Company Limited - Australia
- Aditya Birla Group - India
- Petron Corporation, Philippines
- Indika Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Coalindo Energy - Indonesia
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- Singapore Mercantile Exchange
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Australian Coal Association
- Lanco Infratech Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Siam City Cement PLC, Thailand
- Edison Trading Spa - Italy
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Aboitiz Power Corporation - Philippines
- The State Trading Corporation of India Ltd
- Global Green Power PLC Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Indo Tambangraya Megah - Indonesia
- VISA Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Ministry of Transport, Egypt
- Deloitte Consulting - India
- SMC Global Power, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- ASAPP Information Group - India
- TeaM Sual Corporation - Philippines
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Meralco Power Generation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
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