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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
Supramax
Market reducing speed. Rates are dropping further for supras outbound USG on fronth, bkhaul is more stable i.e $25k/22k respectively say ...
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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- The Treasury - Australian Government
- Mercator Lines Limited - India
- Medco Energi Mining Internasional
- Mercuria Energy - Indonesia
- McConnell Dowell - Australia
- Vizag Seaport Private Limited - India
- Metalloyd Limited - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Port Waratah Coal Services - Australia
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- White Energy Company Limited
- Eastern Coal Council - USA
- Kumho Petrochemical, South Korea
- Global Coal Blending Company Limited - Australia
- Marubeni Corporation - India
- The University of Queensland
- Economic Council, Georgia
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Thai Mozambique Logistica
- Cement Manufacturers Association - India
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Straits Asia Resources Limited - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Baramulti Group, Indonesia
- Parry Sugars Refinery, India
- MS Steel International - UAE
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- London Commodity Brokers - England
- Kartika Selabumi Mining - Indonesia
- ICICI Bank Limited - India
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Orica Mining Services - Indonesia
- Carbofer General Trading SA - India
- Indika Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Price Waterhouse Coopers - Russia
- Mintek Dendrill Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Xindia Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- IEA Clean Coal Centre - UK
- Anglo American - United Kingdom
- San Jose City I Power Corp, Philippines
- Deloitte Consulting - India
- Timah Investasi Mineral - Indoneisa
- Karaikal Port Pvt Ltd - India
- Parliament of New Zealand
- Chamber of Mines of South Africa
- PetroVietnam Power Coal Import and Supply Company
- Directorate Of Revenue Intelligence - India
- Standard Chartered Bank - UAE
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- The State Trading Corporation of India Ltd
- Kohat Cement Company Ltd. - Pakistan
- Bukit Baiduri Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Minerals Council of Australia
- Billiton Holdings Pty Ltd - Australia
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- Central Electricity Authority - India
- Bharathi Cement Corporation - India
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Larsen & Toubro Limited - India
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Rio Tinto Coal - Australia
- Wood Mackenzie - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Meralco Power Generation, Philippines
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Posco Energy - South Korea
- Altura Mining Limited, Indonesia
- South Luzon Thermal Energy Corporation
- CNBM International Corporation - China
- Gujarat Sidhee Cement - India
- Commonwealth Bank - Australia
- Romanian Commodities Exchange
- Energy Development Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Ind-Barath Power Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- Meenaskhi Energy Private Limited - India
- Coastal Gujarat Power Limited - India
- Eastern Energy - Thailand
- Dalmia Cement Bharat India
- Latin American Coal - Colombia
- Makarim & Taira - Indonesia
- Sindya Power Generating Company Private Ltd
- Simpson Spence & Young - Indonesia
- Orica Australia Pty. Ltd.
- SMC Global Power, Philippines
- Toyota Tsusho Corporation, Japan
- Holcim Trading Pte Ltd - Singapore
- Star Paper Mills Limited - India
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Oldendorff Carriers - Singapore
- Formosa Plastics Group - Taiwan
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Electricity Authority, New Zealand
- PNOC Exploration Corporation - Philippines
- Coal and Oil Company - UAE
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Agrawal Coal Company - India
- OPG Power Generation Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Global Green Power PLC Corporation, Philippines
- Australian Commodity Traders Exchange
- Semirara Mining and Power Corporation, Philippines
- Wilmar Investment Holdings
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Bhoruka Overseas - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- ASAPP Information Group - India
- Tamil Nadu electricity Board
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Indo Tambangraya Megah - Indonesia
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Madhucon Powers Ltd - India
- Ministry of Mines - Canada
- Australian Coal Association
- Kapuas Tunggal Persada - Indonesia
- New Zealand Coal & Carbon
- GMR Energy Limited - India
- Trasteel International SA, Italy
- Savvy Resources Ltd - HongKong
- Semirara Mining Corp, Philippines
- Sical Logistics Limited - India
- TeaM Sual Corporation - Philippines
- Heidelberg Cement - Germany
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Petron Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Planning Commission, India
- Videocon Industries ltd - India
- Siam City Cement PLC, Thailand
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Coalindo Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Vedanta Resources Plc - India
- Petrochimia International Co. Ltd.- Taiwan
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PTC India Limited - India
- Malabar Cements Ltd - India
- Therma Luzon, Inc, Philippines
- CIMB Investment Bank - Malaysia
- Samtan Co., Ltd - South Korea
- Borneo Indobara - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Georgia Ports Authority, United States
- Barasentosa Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Africa Commodities Group - South Africa
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