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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, 21 December 17
FUEL SHORTAGE TRIGGERS JUMP IN COAL PRICES - CHINA DAILY
China’s thermal coal prices jumped recently as natural gas shortages across the north spurred an unexpected resurgence in demand for coal-fir ...
Thursday, 21 December 17
SUPRAMAX: IN THE MOST CHANCE, DO NOT EXPECT ANY DRAMATIC CHANGES IN THE NEAR FUTURE - FEARNLEYS
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Wednesday, 20 December 17
INDONESIAN HBA FELL FOR THE FIRST TIME IN SIX MONTHS, GOVERNMENT DATA SHOWS
COALspot.com: HBA fell 0.80 per cent in December, marking the first fall for the Indonesian Coal Price Reference ( HBA) since June 2017, the latest ...
Monday, 18 December 17
U.S. COAL EXPORTS FOR THE FIRST THREE QUARTERS OF 2017 WERE 69 MMST; UP 68% M/M - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.5 million sho ...
Thursday, 14 December 17
SUPRAMAX: INDO COAL TO CHINA AROUND LOW $10K DELIVERY SINGAPORE
Supramax
Atlantic basin kept its firm pace with charters still busy with covering pre-holiday requirements. Ultras got close to $20k for ordinary ...
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Showing 1846 to 1850 news of total 6871 |
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- Posco Energy - South Korea
- Bangladesh Power Developement Board
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement PLC, Thailand
- Kohat Cement Company Ltd. - Pakistan
- Banpu Public Company Limited - Thailand
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Australian Commodity Traders Exchange
- Coastal Gujarat Power Limited - India
- Wood Mackenzie - Singapore
- Binh Thuan Hamico - Vietnam
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- ASAPP Information Group - India
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Manunggal Multi Energi - Indonesia
- Goldman Sachs - Singapore
- Parliament of New Zealand
- Central Electricity Authority - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- Kalimantan Lumbung Energi - Indonesia
- Eastern Coal Council - USA
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- Commonwealth Bank - Australia
- Central Java Power - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- Australian Coal Association
- Attock Cement Pakistan Limited
- Billiton Holdings Pty Ltd - Australia
- Larsen & Toubro Limited - India
- Simpson Spence & Young - Indonesia
- Kideco Jaya Agung - Indonesia
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- Bukit Asam (Persero) Tbk - Indonesia
- Medco Energi Mining Internasional
- Merrill Lynch Commodities Europe
- GVK Power & Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Salva Resources Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Electricity Authority, New Zealand
- White Energy Company Limited
- AsiaOL BioFuels Corp., Philippines
- Tamil Nadu electricity Board
- Metalloyd Limited - United Kingdom
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Energy Development Corp, Philippines
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Pendopo Energi Batubara - Indonesia
- South Luzon Thermal Energy Corporation
- Indian Energy Exchange, India
- Global Coal Blending Company Limited - Australia
- Antam Resourcindo - Indonesia
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Borneo Indobara - Indonesia
- Sakthi Sugars Limited - India
- Therma Luzon, Inc, Philippines
- Chamber of Mines of South Africa
- Marubeni Corporation - India
- Formosa Plastics Group - Taiwan
- Mjunction Services Limited - India
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Agrawal Coal Company - India
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- SMG Consultants - Indonesia
- Cement Manufacturers Association - India
- Miang Besar Coal Terminal - Indonesia
- PowerSource Philippines DevCo
- Ceylon Electricity Board - Sri Lanka
- Tata Chemicals Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Karaikal Port Pvt Ltd - India
- Indonesian Coal Mining Association
- Bayan Resources Tbk. - Indonesia
- Coalindo Energy - Indonesia
- IEA Clean Coal Centre - UK
- Price Waterhouse Coopers - Russia
- Port Waratah Coal Services - Australia
- Meenaskhi Energy Private Limited - India
- Sojitz Corporation - Japan
- Malabar Cements Ltd - India
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- The University of Queensland
- Rashtriya Ispat Nigam Limited - India
- Renaissance Capital - South Africa
- Ambuja Cements Ltd - India
- Sree Jayajothi Cements Limited - India
- Directorate Of Revenue Intelligence - India
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Oldendorff Carriers - Singapore
- Planning Commission, India
- European Bulk Services B.V. - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Chettinad Cement Corporation Ltd - India
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Energy Link Ltd, New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meralco Power Generation, Philippines
- Aboitiz Power Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- Siam City Cement - Thailand
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Uttam Galva Steels Limited - India
- Ministry of Mines - Canada
- London Commodity Brokers - England
- Indian Oil Corporation Limited
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- LBH Netherlands Bv - Netherlands
- ICICI Bank Limited - India
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- Bhatia International Limited - India
- Thai Mozambique Logistica
- CNBM International Corporation - China
- Intertek Mineral Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Semirara Mining and Power Corporation, Philippines
- Baramulti Group, Indonesia
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- Bukit Baiduri Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Power Finance Corporation Ltd., India
- Ministry of Finance - Indonesia
- Samtan Co., Ltd - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Sical Logistics Limited - India
- Star Paper Mills Limited - India
- MS Steel International - UAE
- Holcim Trading Pte Ltd - Singapore
- Alfred C Toepfer International GmbH - Germany
- Maharashtra Electricity Regulatory Commission - India
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coal and Oil Company - UAE
- Anglo American - United Kingdom
- Economic Council, Georgia
- Grasim Industreis Ltd - India
- Interocean Group of Companies - India
- Electricity Generating Authority of Thailand
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- Makarim & Taira - Indonesia
- Kepco SPC Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
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