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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, 13 December 17
REFINED COAL HAS MADE UP NEARLY ONE-FIFTH OF COAL-FIRED POWER GENERATION SO FAR IN 2017 - EIA
The U.S. power sector consumption of coal is increasingly shifting to refined coal, even as coal-fired electricity generation decreases. Use of ref ...
Wednesday, 13 December 17
DEMAND FOR THERMAL COAL LOOKED RELATIVELY ROBUST - DANIEL HYNES
Coal prices were a touch higher. Demand for thermal coal looked relatively robust, after reports continued to surface that Chinese authorities have ...
Wednesday, 13 December 17
SHIPPING MARKET INSIGHT - GEORGE PANAGOPOULOS
As another year is coming to an end and much has been already written about the positive reversal in the dry bulk market, we think it is interestin ...
Monday, 11 December 17
INDIA CONSUMERS ARE SAID TO BE DESPERATELY SEEKING CARGOES - DANIEL HYNES
Coal markets were stronger, as strong demand outside China continues to spur buying said Daniel Hynes, Senior Commodity Strategist at ANZ.
Acc ...
Monday, 11 December 17
CAPESIZE FFA MARKET LOOKING PROMISING MOVING FORWARD - FIS
Capesize
Another very promising day for the big ships as rates continued to firm in both oceans and the paper market ate into the backwardation s ...
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Showing 1851 to 1855 news of total 6871 |
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- Essar Steel Hazira Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Parliament of New Zealand
- White Energy Company Limited
- Straits Asia Resources Limited - Singapore
- Ministry of Transport, Egypt
- Interocean Group of Companies - India
- Bangladesh Power Developement Board
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mintek Dendrill Indonesia
- Kaltim Prima Coal - Indonesia
- PTC India Limited - India
- Indo Tambangraya Megah - Indonesia
- Orica Australia Pty. Ltd.
- Pipit Mutiara Jaya. PT, Indonesia
- Thai Mozambique Logistica
- Videocon Industries ltd - India
- Larsen & Toubro Limited - India
- Savvy Resources Ltd - HongKong
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- Bhatia International Limited - India
- Georgia Ports Authority, United States
- Planning Commission, India
- Altura Mining Limited, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Barasentosa Lestari - Indonesia
- The University of Queensland
- Sindya Power Generating Company Private Ltd
- Port Waratah Coal Services - Australia
- Toyota Tsusho Corporation, Japan
- Rashtriya Ispat Nigam Limited - India
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement PLC, Thailand
- Formosa Plastics Group - Taiwan
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- Energy Development Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Mjunction Services Limited - India
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Commonwealth Bank - Australia
- Central Electricity Authority - India
- IEA Clean Coal Centre - UK
- Thiess Contractors Indonesia
- Siam City Cement - Thailand
- New Zealand Coal & Carbon
- Krishnapatnam Port Company Ltd. - India
- Aboitiz Power Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Carbofer General Trading SA - India
- Ministry of Mines - Canada
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- Bhushan Steel Limited - India
- Ministry of Finance - Indonesia
- Ambuja Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Standard Chartered Bank - UAE
- Borneo Indobara - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Binh Thuan Hamico - Vietnam
- Semirara Mining Corp, Philippines
- Latin American Coal - Colombia
- Bukit Baiduri Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- Agrawal Coal Company - India
- Global Green Power PLC Corporation, Philippines
- VISA Power Limited - India
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- Kobexindo Tractors - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Manunggal Multi Energi - Indonesia
- Petron Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- TeaM Sual Corporation - Philippines
- Eastern Energy - Thailand
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- Australian Coal Association
- Intertek Mineral Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Chamber of Mines of South Africa
- Indika Energy - Indonesia
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- Chettinad Cement Corporation Ltd - India
- Grasim Industreis Ltd - India
- India Bulls Power Limited - India
- The Treasury - Australian Government
- Wilmar Investment Holdings
- GVK Power & Infra Limited - India
- Eastern Coal Council - USA
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- PowerSource Philippines DevCo
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Romanian Commodities Exchange
- Madhucon Powers Ltd - India
- Karaikal Port Pvt Ltd - India
- CNBM International Corporation - China
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cement Manufacturers Association - India
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Jindal Steel & Power Ltd - India
- Mercuria Energy - Indonesia
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Coalindo Energy - Indonesia
- Orica Mining Services - Indonesia
- Samtan Co., Ltd - South Korea
- Australian Commodity Traders Exchange
- Renaissance Capital - South Africa
- Miang Besar Coal Terminal - Indonesia
- ICICI Bank Limited - India
- Goldman Sachs - Singapore
- GMR Energy Limited - India
- OPG Power Generation Pvt Ltd - India
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- Vedanta Resources Plc - India
- Makarim & Taira - Indonesia
- Jaiprakash Power Ventures ltd
- Energy Link Ltd, New Zealand
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Dalmia Cement Bharat India
- Tata Chemicals Ltd - India
- Central Java Power - Indonesia
- GAC Shipping (India) Pvt Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Tamil Nadu electricity Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- Attock Cement Pakistan Limited
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Sakthi Sugars Limited - India
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Deloitte Consulting - India
- Sarangani Energy Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- MS Steel International - UAE
- Minerals Council of Australia
- Electricity Generating Authority of Thailand
- Aditya Birla Group - India
- Medco Energi Mining Internasional
- Vizag Seaport Private Limited - India
- Antam Resourcindo - Indonesia
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- Economic Council, Georgia
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Bahari Cakrawala Sebuku - Indonesia
- Maheswari Brothers Coal Limited - India
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Merrill Lynch Commodities Europe
- Timah Investasi Mineral - Indoneisa
- Meralco Power Generation, Philippines
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- Indogreen Group - Indonesia
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