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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, 05 January 18
COAL DEMAND TO REMAIN FLAT TO 2022, RESULTING IN A DECADE OF STAGNATION - IEA
Global demand for coal should remain nearly flat between 2017 and 2022, resulting in a decade of stagnation for coal consumption, according to the ...
Thursday, 04 January 18
SUPRAMAX: INDO TO CHINA WERE FIXED AT AROUND $8K DAILY; DOWN AROUND 27% WOW
Supramax
Q1 kicked off with an usual standby with all counterparts waiting for the market to take direction. Further holidays in East-Europe adde ...
Wednesday, 03 January 18
KOMIPO TO BUY 130K TONS OF MIN. 5700 NAR COAL FOR FEB 2018 LOADING
COALspot.com: South Korea state-owned utility Korea Midland Power (KOMIPO) issued a tender for 130k Metric Tons of min. 5700 NAR coal to be burnt a ...
Friday, 29 December 17
PORT OF NEWCASTLE SHIPPED A$ 1.527 BILLION WORTH OF 12.65 MT OF COAL IN NOVEMBER
COALspot.com: The Port of Newcastle, Australia’s major trading ports, and the world’s largest coal export port has shipped $AU 1527.6 M ...
Friday, 29 December 17
U.S WEEKLY COAL PRODUCTION SLIGHTLY UP FOR THE WEEK ENDING 23 DEC, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totaled an estimated 15.5 million short tons ...
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Showing 1836 to 1840 news of total 6871 |
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- Bulk Trading Sa - Switzerland
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Vedanta Resources Plc - India
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Mjunction Services Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Transport, Egypt
- Anglo American - United Kingdom
- London Commodity Brokers - England
- Kohat Cement Company Ltd. - Pakistan
- CIMB Investment Bank - Malaysia
- Aditya Birla Group - India
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Mercuria Energy - Indonesia
- Ministry of Mines - Canada
- Sindya Power Generating Company Private Ltd
- San Jose City I Power Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- India Bulls Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Coal and Oil Company - UAE
- Trasteel International SA, Italy
- Planning Commission, India
- ICICI Bank Limited - India
- Directorate Of Revenue Intelligence - India
- Metalloyd Limited - United Kingdom
- Mintek Dendrill Indonesia
- GMR Energy Limited - India
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- Ambuja Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Rio Tinto Coal - Australia
- Eastern Energy - Thailand
- CNBM International Corporation - China
- Directorate General of MIneral and Coal - Indonesia
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- Interocean Group of Companies - India
- Altura Mining Limited, Indonesia
- Indian Energy Exchange, India
- Heidelberg Cement - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Ceylon Electricity Board - Sri Lanka
- Riau Bara Harum - Indonesia
- The Treasury - Australian Government
- Indogreen Group - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Antam Resourcindo - Indonesia
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Barasentosa Lestari - Indonesia
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Grasim Industreis Ltd - India
- Power Finance Corporation Ltd., India
- Attock Cement Pakistan Limited
- Deloitte Consulting - India
- Sree Jayajothi Cements Limited - India
- Sakthi Sugars Limited - India
- New Zealand Coal & Carbon
- Singapore Mercantile Exchange
- Lanco Infratech Ltd - India
- Bukit Baiduri Energy - Indonesia
- Port Waratah Coal Services - Australia
- Global Coal Blending Company Limited - Australia
- Borneo Indobara - Indonesia
- Vizag Seaport Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- GAC Shipping (India) Pvt Ltd
- Xindia Steels Limited - India
- Sojitz Corporation - Japan
- Merrill Lynch Commodities Europe
- Siam City Cement PLC, Thailand
- Alfred C Toepfer International GmbH - Germany
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Central Electricity Authority - India
- Electricity Authority, New Zealand
- Jindal Steel & Power Ltd - India
- Australian Commodity Traders Exchange
- Jorong Barutama Greston.PT - Indonesia
- Parry Sugars Refinery, India
- Semirara Mining Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Therma Luzon, Inc, Philippines
- Madhucon Powers Ltd - India
- Agrawal Coal Company - India
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- PTC India Limited - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Straits Asia Resources Limited - Singapore
- Bharathi Cement Corporation - India
- European Bulk Services B.V. - Netherlands
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- IHS Mccloskey Coal Group - USA
- Jaiprakash Power Ventures ltd
- Tata Chemicals Ltd - India
- Formosa Plastics Group - Taiwan
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- Bhoruka Overseas - Indonesia
- Kaltim Prima Coal - Indonesia
- Parliament of New Zealand
- Savvy Resources Ltd - HongKong
- The State Trading Corporation of India Ltd
- Orica Mining Services - Indonesia
- PowerSource Philippines DevCo
- Electricity Generating Authority of Thailand
- White Energy Company Limited
- Simpson Spence & Young - Indonesia
- Iligan Light & Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- PNOC Exploration Corporation - Philippines
- Marubeni Corporation - India
- Central Java Power - Indonesia
- McConnell Dowell - Australia
- TeaM Sual Corporation - Philippines
- Videocon Industries ltd - India
- Romanian Commodities Exchange
- Star Paper Mills Limited - India
- Gujarat Sidhee Cement - India
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Pendopo Energi Batubara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Dalmia Cement Bharat India
- Bangladesh Power Developement Board
- Eastern Coal Council - USA
- Leighton Contractors Pty Ltd - Australia
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- Tamil Nadu electricity Board
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- MS Steel International - UAE
- Petron Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Karaikal Port Pvt Ltd - India
- Goldman Sachs - Singapore
- Banpu Public Company Limited - Thailand
- Georgia Ports Authority, United States
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Energy Link Ltd, New Zealand
- SN Aboitiz Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Medco Energi Mining Internasional
- Baramulti Group, Indonesia
- Toyota Tsusho Corporation, Japan
- PetroVietnam Power Coal Import and Supply Company
- VISA Power Limited - India
- Thai Mozambique Logistica
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- Salva Resources Pvt Ltd - India
- Energy Development Corp, Philippines
- Mercator Lines Limited - India
- Chamber of Mines of South Africa
- Billiton Holdings Pty Ltd - Australia
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