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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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Thursday, 02 January 20
SULPHUR 2020 COMPENDIUM - HOW ARE INDIVIDUAL PORT STATES EXPECTED TO REACT? - STANDARD CLUB
KNOWLEDGE TO ELEVATE
With the new sulphur limits soon to be in force, Standard Club has been investigating the ways in which certain jurisdict ...
Monday, 30 December 19
AUSTRALIAN MINERS HIT BY LOWEST THERMAL COAL PRICE IN MORE THAN A DECADE - THE GUARDIAN
Australian coal exporters have experienced the biggest annual drop in thermal coal prices in more than a decade during 2019, raising doubts about i ...
Monday, 30 December 19
INDIA'S COAL IMPORTS RISE 4% TO 161.43 MT IN APRIL-NOVEMBER 2019 - PTI
The country’s coal imports registered an increase of 4.4 per cent to 161.43 million tonnes (MT) in the April-November period of the ongoing f ...
Sunday, 29 December 19
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Sunday, 29 December 19
IMO 2020 COMPLIANCE: IT'S UP TO US TO BE GOOD CITIZENS - IBIA
One of the concerns around implementation of the 0.50% sulphur limit has been, and continues to be, the need for effective enforcement to ensure a ...
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Showing 1216 to 1220 news of total 6871 |
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- Essar Steel Hazira Ltd - India
- Ambuja Cements Ltd - India
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Miang Besar Coal Terminal - Indonesia
- Videocon Industries ltd - India
- Heidelberg Cement - Germany
- Attock Cement Pakistan Limited
- Siam City Cement - Thailand
- Sojitz Corporation - Japan
- Kumho Petrochemical, South Korea
- Electricity Generating Authority of Thailand
- Ceylon Electricity Board - Sri Lanka
- European Bulk Services B.V. - Netherlands
- Savvy Resources Ltd - HongKong
- Bukit Makmur.PT - Indonesia
- Minerals Council of Australia
- Ministry of Transport, Egypt
- Georgia Ports Authority, United States
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Edison Trading Spa - Italy
- The State Trading Corporation of India Ltd
- ASAPP Information Group - India
- SMC Global Power, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Thai Mozambique Logistica
- Parry Sugars Refinery, India
- Mjunction Services Limited - India
- Interocean Group of Companies - India
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Indo Tambangraya Megah - Indonesia
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Price Waterhouse Coopers - Russia
- Thiess Contractors Indonesia
- Kartika Selabumi Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Indonesian Coal Mining Association
- Chamber of Mines of South Africa
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Indian Energy Exchange, India
- Iligan Light & Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Eastern Energy - Thailand
- Cement Manufacturers Association - India
- Cigading International Bulk Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Larsen & Toubro Limited - India
- Jindal Steel & Power Ltd - India
- Sree Jayajothi Cements Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Mintek Dendrill Indonesia
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Petron Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Bhushan Steel Limited - India
- Maheswari Brothers Coal Limited - India
- Australian Commodity Traders Exchange
- Sinarmas Energy and Mining - Indonesia
- Energy Development Corp, Philippines
- Global Business Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Sindya Power Generating Company Private Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Mercuria Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Vizag Seaport Private Limited - India
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Anglo American - United Kingdom
- Merrill Lynch Commodities Europe
- Marubeni Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Medco Energi Mining Internasional
- Krishnapatnam Port Company Ltd. - India
- Bukit Baiduri Energy - Indonesia
- VISA Power Limited - India
- International Coal Ventures Pvt Ltd - India
- India Bulls Power Limited - India
- ICICI Bank Limited - India
- Latin American Coal - Colombia
- Goldman Sachs - Singapore
- Sarangani Energy Corporation, Philippines
- New Zealand Coal & Carbon
- White Energy Company Limited
- Central Java Power - Indonesia
- Timah Investasi Mineral - Indoneisa
- Barasentosa Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercator Lines Limited - India
- Deloitte Consulting - India
- Alfred C Toepfer International GmbH - Germany
- Kideco Jaya Agung - Indonesia
- Independent Power Producers Association of India
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Lanco Infratech Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Commonwealth Bank - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- LBH Netherlands Bv - Netherlands
- Salva Resources Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Tata Chemicals Ltd - India
- Romanian Commodities Exchange
- Globalindo Alam Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bulk Trading Sa - Switzerland
- Planning Commission, India
- CIMB Investment Bank - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Coastal Gujarat Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- The University of Queensland
- Meralco Power Generation, Philippines
- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- AsiaOL BioFuels Corp., Philippines
- Global Green Power PLC Corporation, Philippines
- GVK Power & Infra Limited - India
- Eastern Coal Council - USA
- Uttam Galva Steels Limited - India
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- SMG Consultants - Indonesia
- MS Steel International - UAE
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Gujarat Sidhee Cement - India
- Ind-Barath Power Infra Limited - India
- London Commodity Brokers - England
- San Jose City I Power Corp, Philippines
- Binh Thuan Hamico - Vietnam
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- Bayan Resources Tbk. - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- CNBM International Corporation - China
- Bank of Tokyo Mitsubishi UFJ Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Kobexindo Tractors - Indoneisa
- GMR Energy Limited - India
- Aditya Birla Group - India
- Malabar Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Vedanta Resources Plc - India
- Samtan Co., Ltd - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Kepco SPC Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- PTC India Limited - India
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining and Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- Grasim Industreis Ltd - India
- Carbofer General Trading SA - India
- Orica Mining Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Dalmia Cement Bharat India
- Wood Mackenzie - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Port Waratah Coal Services - Australia
- Parliament of New Zealand
- South Luzon Thermal Energy Corporation
- Directorate General of MIneral and Coal - Indonesia
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Singapore Mercantile Exchange
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