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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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Wednesday, 26 February 20
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Showing 1106 to 1110 news of total 6871 |
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- Antam Resourcindo - Indonesia
- Intertek Mineral Services - Indonesia
- Jaiprakash Power Ventures ltd
- New Zealand Coal & Carbon
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- Indian Oil Corporation Limited
- SMC Global Power, Philippines
- Formosa Plastics Group - Taiwan
- Alfred C Toepfer International GmbH - Germany
- Bhatia International Limited - India
- Ceylon Electricity Board - Sri Lanka
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Kaltim Prima Coal - Indonesia
- Aditya Birla Group - India
- Larsen & Toubro Limited - India
- Australian Coal Association
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- International Coal Ventures Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Sakthi Sugars Limited - India
- Economic Council, Georgia
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- Barasentosa Lestari - Indonesia
- Medco Energi Mining Internasional
- Heidelberg Cement - Germany
- India Bulls Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Riau Bara Harum - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Goldman Sachs - Singapore
- Indo Tambangraya Megah - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coal and Oil Company - UAE
- Directorate General of MIneral and Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Romanian Commodities Exchange
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- Coastal Gujarat Power Limited - India
- Sree Jayajothi Cements Limited - India
- Sarangani Energy Corporation, Philippines
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- McConnell Dowell - Australia
- Orica Mining Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Posco Energy - South Korea
- Meralco Power Generation, Philippines
- White Energy Company Limited
- Semirara Mining Corp, Philippines
- Anglo American - United Kingdom
- Toyota Tsusho Corporation, Japan
- Meenaskhi Energy Private Limited - India
- Vizag Seaport Private Limited - India
- Ind-Barath Power Infra Limited - India
- Indogreen Group - Indonesia
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Siam City Cement PLC, Thailand
- Tamil Nadu electricity Board
- Marubeni Corporation - India
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- Karaikal Port Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- Mintek Dendrill Indonesia
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Australian Commodity Traders Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Africa Commodities Group - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- TeaM Sual Corporation - Philippines
- GVK Power & Infra Limited - India
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Renaissance Capital - South Africa
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Mercuria Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- Ministry of Mines - Canada
- ASAPP Information Group - India
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- Carbofer General Trading SA - India
- Aboitiz Power Corporation - Philippines
- PTC India Limited - India
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
- OPG Power Generation Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Singapore Mercantile Exchange
- Oldendorff Carriers - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Parry Sugars Refinery, India
- Karbindo Abesyapradhi - Indoneisa
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Sojitz Corporation - Japan
- Iligan Light & Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- The Treasury - Australian Government
- Global Green Power PLC Corporation, Philippines
- Central Electricity Authority - India
- Price Waterhouse Coopers - Russia
- Manunggal Multi Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Edison Trading Spa - Italy
- Chettinad Cement Corporation Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- CIMB Investment Bank - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- Ambuja Cements Ltd - India
- Standard Chartered Bank - UAE
- VISA Power Limited - India
- Baramulti Group, Indonesia
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Holcim Trading Pte Ltd - Singapore
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Parliament of New Zealand
- Eastern Energy - Thailand
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- GN Power Mariveles Coal Plant, Philippines
- Deloitte Consulting - India
- SMG Consultants - Indonesia
- ICICI Bank Limited - India
- European Bulk Services B.V. - Netherlands
- Bukit Makmur.PT - Indonesia
- LBH Netherlands Bv - Netherlands
- Krishnapatnam Port Company Ltd. - India
- The University of Queensland
- GAC Shipping (India) Pvt Ltd
- Globalindo Alam Lestari - Indonesia
- Madhucon Powers Ltd - India
- Savvy Resources Ltd - HongKong
- Directorate Of Revenue Intelligence - India
- Makarim & Taira - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Independent Power Producers Association of India
- Coalindo Energy - Indonesia
- Latin American Coal - Colombia
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Star Paper Mills Limited - India
- Commonwealth Bank - Australia
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