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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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Tuesday, 05 September 17
COAL: A STRONG MOVEMENT IN THE COAL MARKET OVER THE SUMMER MONTHS - GEORGE LAZARIDIS
We have been witnessing a strong movement in the coal market over the summer months something that has not only helped boost prices for the commodi ...
Friday, 01 September 17
U.S COAL OUTPUT DIPS WEEK OVER WEEK, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 16.7 million short ton ...
Thursday, 31 August 17
SUPRAMAX: INDO TO CHINA COAL TRIPS AT AROUND $9000, DELIVERY THAILAND - FEARNLEYS
Supramax
A bit slow start to the week with UK holidays on Monday. Still strong rates for cargoes out of Black Sea, where front hauls where done $ ...
Tuesday, 29 August 17
WEEKLY SHIPPING MARKET ANALYSIS - ALLIED
In the aftermath of Hurricane Harvey, one of the worst disasters to hit Texas, we are now looking to get a clearer picture of the possible disrupti ...
Tuesday, 29 August 17
U.S WEEKLY COAL OUT UP 3.4% WEEK OVER WEEK TO APPROX. 17 MMST, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 17 million short tonne ...
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Showing 1956 to 1960 news of total 6871 |
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- Antam Resourcindo - Indonesia
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Cement Manufacturers Association - India
- TNB Fuel Sdn Bhd - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- Oldendorff Carriers - Singapore
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- SN Aboitiz Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Borneo Indobara - Indonesia
- Bangladesh Power Developement Board
- San Jose City I Power Corp, Philippines
- Interocean Group of Companies - India
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Indika Energy - Indonesia
- Australian Commodity Traders Exchange
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Coastal Gujarat Power Limited - India
- Anglo American - United Kingdom
- South Luzon Thermal Energy Corporation
- Maheswari Brothers Coal Limited - India
- PTC India Limited - India
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Ministry of Finance - Indonesia
- Coalindo Energy - Indonesia
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- Trasteel International SA, Italy
- India Bulls Power Limited - India
- The Treasury - Australian Government
- London Commodity Brokers - England
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Bhushan Steel Limited - India
- Sical Logistics Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Central Java Power - Indonesia
- Bayan Resources Tbk. - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Karbindo Abesyapradhi - Indoneisa
- PNOC Exploration Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Tata Chemicals Ltd - India
- Lanco Infratech Ltd - India
- Wilmar Investment Holdings
- Therma Luzon, Inc, Philippines
- Medco Energi Mining Internasional
- Ambuja Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Formosa Plastics Group - Taiwan
- Semirara Mining and Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- LBH Netherlands Bv - Netherlands
- Grasim Industreis Ltd - India
- Toyota Tsusho Corporation, Japan
- Intertek Mineral Services - Indonesia
- Orica Australia Pty. Ltd.
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- Siam City Cement - Thailand
- Neyveli Lignite Corporation Ltd, - India
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Australian Coal Association
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Economic Council, Georgia
- IHS Mccloskey Coal Group - USA
- Essar Steel Hazira Ltd - India
- Savvy Resources Ltd - HongKong
- Ceylon Electricity Board - Sri Lanka
- Global Green Power PLC Corporation, Philippines
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Jaiprakash Power Ventures ltd
- Cigading International Bulk Terminal - Indonesia
- Parliament of New Zealand
- GVK Power & Infra Limited - India
- Siam City Cement PLC, Thailand
- The University of Queensland
- New Zealand Coal & Carbon
- ICICI Bank Limited - India
- Minerals Council of Australia
- Aditya Birla Group - India
- Thiess Contractors Indonesia
- Malabar Cements Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Bukit Baiduri Energy - Indonesia
- Indian Oil Corporation Limited
- Chettinad Cement Corporation Ltd - India
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Transport, Egypt
- IEA Clean Coal Centre - UK
- Jindal Steel & Power Ltd - India
- Georgia Ports Authority, United States
- Commonwealth Bank - Australia
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Price Waterhouse Coopers - Russia
- MS Steel International - UAE
- Iligan Light & Power Inc, Philippines
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Energy Exchange, India
- Port Waratah Coal Services - Australia
- Kideco Jaya Agung - Indonesia
- Africa Commodities Group - South Africa
- CIMB Investment Bank - Malaysia
- Power Finance Corporation Ltd., India
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- European Bulk Services B.V. - Netherlands
- Bhatia International Limited - India
- SMG Consultants - Indonesia
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- Videocon Industries ltd - India
- Rio Tinto Coal - Australia
- Straits Asia Resources Limited - Singapore
- Rashtriya Ispat Nigam Limited - India
- Merrill Lynch Commodities Europe
- Banpu Public Company Limited - Thailand
- Jorong Barutama Greston.PT - Indonesia
- CNBM International Corporation - China
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Ministry of Mines - Canada
- Krishnapatnam Port Company Ltd. - India
- Parry Sugars Refinery, India
- GMR Energy Limited - India
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Indonesian Coal Mining Association
- Independent Power Producers Association of India
- Simpson Spence & Young - Indonesia
- Kaltim Prima Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Agrawal Coal Company - India
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- SMC Global Power, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- McConnell Dowell - Australia
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Electricity Authority, New Zealand
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- Sindya Power Generating Company Private Ltd
- Kumho Petrochemical, South Korea
- Indogreen Group - Indonesia
- Eastern Coal Council - USA
- Gujarat Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Energy Link Ltd, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Carbofer General Trading SA - India
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- Latin American Coal - Colombia
- Meenaskhi Energy Private Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Central Electricity Authority - India
- Goldman Sachs - Singapore
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