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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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Friday, 18 October 19
SINGAPORE'S APEX TO LAUNCH LOW-SULFUR FUEL OIL CONTRACT AHEAD OF NEW SHIPPING RULES - REUTERS
Singapore-based Asia Pacific Exchange (APEX) will launch a low-sulfur fuel oil (LSFO) futures contract on Friday aimed at helping shipping and ener ...
Thursday, 17 October 19
INDIA READIES POLICY TO ATTRACT FOREIGN INVESTMENT IN COAL MINING - REUTERS
India expects to have formulated a policy within the next two weeks to attract foreign investment to its coal mining industry, the country’s ...
Wednesday, 16 October 19
INDIA CALLS FOR A RESET OF CLIMATE DEBATE ON COAL AS A FUEL - LIVEMINT
India on Tuesday called for a reset on climate debate on coal as a fuel, in the backdrop of India becoming one of the top renewable energy producer ...
Wednesday, 16 October 19
LESSONS LEARNT FROM CREW INJURED IN HEAVY WEATHER - UK P&I CLUB COMMENTS
KNOWLEDGE TO ELEVATE
Stuart Edmonston, Loss Prevention at UK P&I Club, discusses an incident in which crew were injured whilst on deck in ...
Wednesday, 16 October 19
SHIPPING MARKET INSIGHT - INTERMODAL
In perhaps the most interesting market conditions of the past years, the tanker and the dry bulk industry have created a positive sentiment with re ...
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Showing 1311 to 1315 news of total 6871 |
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- GAC Shipping (India) Pvt Ltd
- Straits Asia Resources Limited - Singapore
- Latin American Coal - Colombia
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- SMC Global Power, Philippines
- Vizag Seaport Private Limited - India
- Borneo Indobara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bayan Resources Tbk. - Indonesia
- PowerSource Philippines DevCo
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Indogreen Group - Indonesia
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhoruka Overseas - Indonesia
- Madhucon Powers Ltd - India
- Samtan Co., Ltd - South Korea
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Salva Resources Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- MS Steel International - UAE
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- PTC India Limited - India
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- Wilmar Investment Holdings
- Maharashtra Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- India Bulls Power Limited - India
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- The Treasury - Australian Government
- Meenaskhi Energy Private Limited - India
- Mercator Lines Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Orica Australia Pty. Ltd.
- Heidelberg Cement - Germany
- Georgia Ports Authority, United States
- Parry Sugars Refinery, India
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Sojitz Corporation - Japan
- Formosa Plastics Group - Taiwan
- Savvy Resources Ltd - HongKong
- Edison Trading Spa - Italy
- Dalmia Cement Bharat India
- Parliament of New Zealand
- Power Finance Corporation Ltd., India
- Kartika Selabumi Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Lanco Infratech Ltd - India
- Economic Council, Georgia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bulk Trading Sa - Switzerland
- Aboitiz Power Corporation - Philippines
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Aditya Birla Group - India
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Romanian Commodities Exchange
- Kapuas Tunggal Persada - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- Commonwealth Bank - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Renaissance Capital - South Africa
- Global Green Power PLC Corporation, Philippines
- Thiess Contractors Indonesia
- Bharathi Cement Corporation - India
- White Energy Company Limited
- Tata Chemicals Ltd - India
- SMG Consultants - Indonesia
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Eastern Energy - Thailand
- Toyota Tsusho Corporation, Japan
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Bukit Makmur.PT - Indonesia
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- The State Trading Corporation of India Ltd
- Kohat Cement Company Ltd. - Pakistan
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- The University of Queensland
- AsiaOL BioFuels Corp., Philippines
- Sindya Power Generating Company Private Ltd
- Coal and Oil Company - UAE
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- Semirara Mining Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- CNBM International Corporation - China
- Goldman Sachs - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Jindal Steel & Power Ltd - India
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- Metalloyd Limited - United Kingdom
- Binh Thuan Hamico - Vietnam
- Banpu Public Company Limited - Thailand
- Gujarat Sidhee Cement - India
- Timah Investasi Mineral - Indoneisa
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Coal Council - USA
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- McConnell Dowell - Australia
- Energy Development Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- GVK Power & Infra Limited - India
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- South Luzon Thermal Energy Corporation
- Ministry of Finance - Indonesia
- IHS Mccloskey Coal Group - USA
- Port Waratah Coal Services - Australia
- Bukit Baiduri Energy - Indonesia
- Independent Power Producers Association of India
- Australian Coal Association
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Bhushan Steel Limited - India
- Larsen & Toubro Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Electricity Generating Authority of Thailand
- VISA Power Limited - India
- Mercuria Energy - Indonesia
- Mintek Dendrill Indonesia
- Medco Energi Mining Internasional
- Agrawal Coal Company - India
- Makarim & Taira - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Vedanta Resources Plc - India
- Marubeni Corporation - India
- Oldendorff Carriers - Singapore
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- Bhatia International Limited - India
- Ministry of Mines - Canada
- Sical Logistics Limited - India
- Antam Resourcindo - Indonesia
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- Trasteel International SA, Italy
- Cement Manufacturers Association - India
- Krishnapatnam Port Company Ltd. - India
- Interocean Group of Companies - India
- Kaltim Prima Coal - Indonesia
- Essar Steel Hazira Ltd - India
- Posco Energy - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Jaiprakash Power Ventures ltd
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- ASAPP Information Group - India
- Jorong Barutama Greston.PT - Indonesia
- Ambuja Cements Ltd - India
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Baramulti Group, Indonesia
- Coalindo Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Africa Commodities Group - South Africa
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
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