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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, 23 May 23
INDIA: COAL OUTPUT UP 8.9%, SUPPLY RISES 11.7% IN APRIL - FINANCIAL EXPRESS
India’s coal production jumped 8.85% to 73.14 million tonne (MT) in April 2023 and the total coal despatch during the month went up 11.66% to ...
Tuesday, 23 May 23
CHINA COAL OUTPUT UP 4.5 PCT IN APRIL - XINHUA
China’s raw coal output posted stable expansion in April, official data showed.
The country produced 380 million tonnes of raw ...
Saturday, 20 May 23
NON-OPEC OIL SUPPLY DEVELOPMENT - OPEC
In 2022, non-OPEC supply is estimated to have increased by 1.9 mb/d y-o-y. Out of this, US liquids production increased by 1.2 mb/d, mainly on the ...
Saturday, 20 May 23
GLOBAL COAL TRADE HAS REALLY PICKED UP PACE IN RECENT MONTHS, NOW FULLY BACK TO PRE-COVID LEVELS - BANCHERO COSTA
Global coal trade has really picked up pace in recent months, and is now fully back to pre-Covid levels. In Jan-Apr 2023, total global seaborne coa ...
Saturday, 20 May 23
MARKET INSIGHT - INTERMODAL
India is one of the world's largest coal producers and one of the world's largest importers of coal. The country uses coal mainly for power ...
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Showing 101 to 105 news of total 6871 |
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- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Medco Energi Mining Internasional
- Sarangani Energy Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Xindia Steels Limited - India
- Coal and Oil Company - UAE
- Kalimantan Lumbung Energi - Indonesia
- GVK Power & Infra Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Cigading International Bulk Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Gujarat Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- International Coal Ventures Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Bhoruka Overseas - Indonesia
- The State Trading Corporation of India Ltd
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Karbindo Abesyapradhi - Indoneisa
- Kaltim Prima Coal - Indonesia
- Baramulti Group, Indonesia
- Semirara Mining Corp, Philippines
- Rio Tinto Coal - Australia
- Ambuja Cements Ltd - India
- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Indian Oil Corporation Limited
- Globalindo Alam Lestari - Indonesia
- Mercuria Energy - Indonesia
- Independent Power Producers Association of India
- Orica Mining Services - Indonesia
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- Larsen & Toubro Limited - India
- SMG Consultants - Indonesia
- Marubeni Corporation - India
- New Zealand Coal & Carbon
- Bulk Trading Sa - Switzerland
- Carbofer General Trading SA - India
- PetroVietnam Power Coal Import and Supply Company
- Global Green Power PLC Corporation, Philippines
- Chamber of Mines of South Africa
- Salva Resources Pvt Ltd - India
- ICICI Bank Limited - India
- IEA Clean Coal Centre - UK
- Wilmar Investment Holdings
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- VISA Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Dalmia Cement Bharat India
- Altura Mining Limited, Indonesia
- Pendopo Energi Batubara - Indonesia
- Minerals Council of Australia
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Indika Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Sindya Power Generating Company Private Ltd
- Karaikal Port Pvt Ltd - India
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- San Jose City I Power Corp, Philippines
- Bhatia International Limited - India
- AsiaOL BioFuels Corp., Philippines
- White Energy Company Limited
- Savvy Resources Ltd - HongKong
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- Kobexindo Tractors - Indoneisa
- MS Steel International - UAE
- Thai Mozambique Logistica
- Oldendorff Carriers - Singapore
- GAC Shipping (India) Pvt Ltd
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Energy Link Ltd, New Zealand
- Straits Asia Resources Limited - Singapore
- Ministry of Finance - Indonesia
- Singapore Mercantile Exchange
- Vedanta Resources Plc - India
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Coalindo Energy - Indonesia
- Africa Commodities Group - South Africa
- Kapuas Tunggal Persada - Indonesia
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Barasentosa Lestari - Indonesia
- Eastern Energy - Thailand
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- Electricity Authority, New Zealand
- Ind-Barath Power Infra Limited - India
- Planning Commission, India
- Mercator Lines Limited - India
- Mjunction Services Limited - India
- Directorate Of Revenue Intelligence - India
- SN Aboitiz Power Inc, Philippines
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Economic Council, Georgia
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- Heidelberg Cement - Germany
- Indo Tambangraya Megah - Indonesia
- Australian Coal Association
- Australian Commodity Traders Exchange
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Videocon Industries ltd - India
- Electricity Generating Authority of Thailand
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- Sakthi Sugars Limited - India
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Riau Bara Harum - Indonesia
- Thiess Contractors Indonesia
- Latin American Coal - Colombia
- Holcim Trading Pte Ltd - Singapore
- Krishnapatnam Port Company Ltd. - India
- Power Finance Corporation Ltd., India
- Romanian Commodities Exchange
- Meralco Power Generation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- The Treasury - Australian Government
- Vijayanagar Sugar Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Bukit Makmur.PT - Indonesia
- Indonesian Coal Mining Association
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Central Java Power - Indonesia
- CIMB Investment Bank - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- ASAPP Information Group - India
- London Commodity Brokers - England
- The University of Queensland
- PowerSource Philippines DevCo
- TeaM Sual Corporation - Philippines
- Merrill Lynch Commodities Europe
- SMC Global Power, Philippines
- Grasim Industreis Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- Tamil Nadu electricity Board
- Agrawal Coal Company - India
- Intertek Mineral Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Sidhee Cement - India
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
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