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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, 10 April 19
KOSPO INVITED BIDS FOR 160K MT OF MIN. 3700 NCV COAL FOR JUNE LOADING
COALspot.com: South Korea state-owned utility Korea Southern Power Co. Ltd (KOSPO) issued a tender for 160,000 MT of min. 3,800 Kcal/kg ~max.4,100 ...
Wednesday, 10 April 19
CHINA'S GROWING THERMAL COAL SUPPLY TO PRESSURE EXPORTERS - FITCH RATINGS
Growing Chinese thermal coal supply is likely to lead to further tightening of import controls by the government, putting pressure on seaborne coal ...
Wednesday, 10 April 19
SHIPPING MARKET INSIGHT - INTERMODAL
The tragedy in Brazil’s Vale Brumadinho where a tailings dam collapsed in January ranks among the world’s worst mining disasters. It co ...
Monday, 08 April 19
5TH INDIA NUCLEAR NEW BUILD CONGRESS 2019
5th India Nuclear New Build Congress 2019
The congress in Mumbai aims to bring together representatives from governments, regulators ...
Monday, 08 April 19
THERMAL COAL PRICES FALL, INDIAN POWER PLANTS TO SEE LIMITED GAINS - BUSINESS STANDARD
Thermal coal prices are on a downward spiral globally. Australian coal prices have fallen nearly 20 per cent in the past week, and 40 per cent from ...
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Showing 1426 to 1430 news of total 6871 |
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- Bukit Baiduri Energy - Indonesia
- Energy Development Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Coalindo Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Rio Tinto Coal - Australia
- Vedanta Resources Plc - India
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Siam City Cement - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Java Power - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Thiess Contractors Indonesia
- Malabar Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ambuja Cements Ltd - India
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Kaltim Prima Coal - Indonesia
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Africa Commodities Group - South Africa
- Indian Oil Corporation Limited
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Coastal Gujarat Power Limited - India
- Madhucon Powers Ltd - India
- VISA Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Indonesian Coal Mining Association
- Deloitte Consulting - India
- Georgia Ports Authority, United States
- CNBM International Corporation - China
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Mjunction Services Limited - India
- Price Waterhouse Coopers - Russia
- Star Paper Mills Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Indogreen Group - Indonesia
- SMC Global Power, Philippines
- Riau Bara Harum - Indonesia
- Attock Cement Pakistan Limited
- New Zealand Coal & Carbon
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Karaikal Port Pvt Ltd - India
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Jindal Steel & Power Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Eastern Energy - Thailand
- India Bulls Power Limited - India
- Timah Investasi Mineral - Indoneisa
- PNOC Exploration Corporation - Philippines
- Kumho Petrochemical, South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Larsen & Toubro Limited - India
- Mintek Dendrill Indonesia
- Sree Jayajothi Cements Limited - India
- The State Trading Corporation of India Ltd
- Bhatia International Limited - India
- Leighton Contractors Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Sical Logistics Limited - India
- Xindia Steels Limited - India
- MS Steel International - UAE
- Parry Sugars Refinery, India
- GN Power Mariveles Coal Plant, Philippines
- Renaissance Capital - South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- Barasentosa Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- Siam City Cement PLC, Thailand
- Gujarat Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- Makarim & Taira - Indonesia
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Parliament of New Zealand
- Planning Commission, India
- Metalloyd Limited - United Kingdom
- McConnell Dowell - Australia
- Kapuas Tunggal Persada - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Commonwealth Bank - Australia
- Holcim Trading Pte Ltd - Singapore
- Uttam Galva Steels Limited - India
- Straits Asia Resources Limited - Singapore
- The University of Queensland
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- Electricity Generating Authority of Thailand
- Dalmia Cement Bharat India
- TeaM Sual Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- SN Aboitiz Power Inc, Philippines
- San Jose City I Power Corp, Philippines
- Minerals Council of Australia
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- GMR Energy Limited - India
- ASAPP Information Group - India
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Tata Chemicals Ltd - India
- Chamber of Mines of South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- Tamil Nadu electricity Board
- Global Green Power PLC Corporation, Philippines
- Ministry of Mines - Canada
- Central Electricity Authority - India
- Sojitz Corporation - Japan
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- Carbofer General Trading SA - India
- International Coal Ventures Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Australian Coal Association
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Edison Trading Spa - Italy
- Independent Power Producers Association of India
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Electricity Authority, New Zealand
- Singapore Mercantile Exchange
- Pendopo Energi Batubara - Indonesia
- Mercuria Energy - Indonesia
- Romanian Commodities Exchange
- Aditya Birla Group - India
- European Bulk Services B.V. - Netherlands
- IHS Mccloskey Coal Group - USA
- PTC India Limited - India
- Power Finance Corporation Ltd., India
- OPG Power Generation Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- South Luzon Thermal Energy Corporation
- Standard Chartered Bank - UAE
- GVK Power & Infra Limited - India
- White Energy Company Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Banpu Public Company Limited - Thailand
- Meralco Power Generation, Philippines
- Bangladesh Power Developement Board
- Sakthi Sugars Limited - India
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- Bulk Trading Sa - Switzerland
- Indika Energy - Indonesia
- Latin American Coal - Colombia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Wood Mackenzie - Singapore
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
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