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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, 14 February 18
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Showing 1806 to 1810 news of total 6871 |
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- New Zealand Coal & Carbon
- Directorate General of MIneral and Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Madhucon Powers Ltd - India
- Timah Investasi Mineral - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PTC India Limited - India
- Star Paper Mills Limited - India
- Singapore Mercantile Exchange
- Australian Coal Association
- Ind-Barath Power Infra Limited - India
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Electricity Generating Authority of Thailand
- Bharathi Cement Corporation - India
- VISA Power Limited - India
- Antam Resourcindo - Indonesia
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- Bulk Trading Sa - Switzerland
- Minerals Council of Australia
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Romanian Commodities Exchange
- IEA Clean Coal Centre - UK
- Aditya Birla Group - India
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Trasteel International SA, Italy
- MS Steel International - UAE
- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Eastern Energy - Thailand
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Standard Chartered Bank - UAE
- Formosa Plastics Group - Taiwan
- Borneo Indobara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bangladesh Power Developement Board
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Pendopo Energi Batubara - Indonesia
- Posco Energy - South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Finance - Indonesia
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Economic Council, Georgia
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Coastal Gujarat Power Limited - India
- Heidelberg Cement - Germany
- ASAPP Information Group - India
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Kideco Jaya Agung - Indonesia
- Global Business Power Corporation, Philippines
- Sojitz Corporation - Japan
- Kohat Cement Company Ltd. - Pakistan
- Holcim Trading Pte Ltd - Singapore
- Jindal Steel & Power Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Marubeni Corporation - India
- Aboitiz Power Corporation - Philippines
- London Commodity Brokers - England
- Meralco Power Generation, Philippines
- Banpu Public Company Limited - Thailand
- Indogreen Group - Indonesia
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- PowerSource Philippines DevCo
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- South Luzon Thermal Energy Corporation
- Medco Energi Mining Internasional
- Oldendorff Carriers - Singapore
- McConnell Dowell - Australia
- Indian Oil Corporation Limited
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Baramulti Group, Indonesia
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Sical Logistics Limited - India
- Bukit Makmur.PT - Indonesia
- Power Finance Corporation Ltd., India
- San Jose City I Power Corp, Philippines
- Indika Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement - Thailand
- Vedanta Resources Plc - India
- SN Aboitiz Power Inc, Philippines
- Rio Tinto Coal - Australia
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Global Coal Blending Company Limited - Australia
- Kapuas Tunggal Persada - Indonesia
- Meenaskhi Energy Private Limited - India
- Therma Luzon, Inc, Philippines
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- GMR Energy Limited - India
- Ceylon Electricity Board - Sri Lanka
- Bhoruka Overseas - Indonesia
- Larsen & Toubro Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Sindya Power Generating Company Private Ltd
- Krishnapatnam Port Company Ltd. - India
- Pipit Mutiara Jaya. PT, Indonesia
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Wood Mackenzie - Singapore
- Independent Power Producers Association of India
- SMC Global Power, Philippines
- Siam City Cement PLC, Thailand
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Semirara Mining and Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Semirara Mining Corp, Philippines
- Ministry of Transport, Egypt
- Central Electricity Authority - India
- Central Java Power - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Parliament of New Zealand
- Tata Chemicals Ltd - India
- Global Green Power PLC Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Lanco Infratech Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- Australian Commodity Traders Exchange
- Barasentosa Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- Agrawal Coal Company - India
- Chettinad Cement Corporation Ltd - India
- Jaiprakash Power Ventures ltd
- Gujarat Sidhee Cement - India
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Interocean Group of Companies - India
- Iligan Light & Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Renaissance Capital - South Africa
- ICICI Bank Limited - India
- Thiess Contractors Indonesia
- Videocon Industries ltd - India
- Mjunction Services Limited - India
- Anglo American - United Kingdom
- Latin American Coal - Colombia
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- Grasim Industreis Ltd - India
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- Alfred C Toepfer International GmbH - Germany
- Tamil Nadu electricity Board
- Goldman Sachs - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
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