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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, 04 August 17
U.S. WEEKLY COAL OUTPUT UP 4.4% W/W - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totaled an estimated 16.1 million short tonn ...
Friday, 04 August 17
IMPORTED COAL CONTINUES TO BE A COMPETITIVE, SAFE AND RELIABLE ENERGY SOURCE FOR GERMANY - VDKI
COALspot.com: Worldwide hard coal production in 2016 declined by 3.8% to 6.7 billion tonnes.
According to the Germany Coal Importers Associati ...
Thursday, 03 August 17
SUPRAMAX: INDO TO CHINA COAL ROUNDS ARE GETTING FIXED AROUND MID $8000 - FEARNLEYS
In the Pacific rates have remained weak and under pressure this week with most routes softening.
Indo/China coal rounds are getting fixed arou ...
Thursday, 03 August 17
BUMI RESOURCES COAL SALES RELATIVELY FLAT AT 41.5 MILLION TONS IN 1H' 17; REPORTS US$162.3 MILLION PROFIT IN FIRST SEMESTER
COALspot.com: The BUMI Resources, Indonesia’s one of the largest coal producer, has reported a net income of $162.3 million in 1H’ 17 c ...
Wednesday, 02 August 17
SHIPPING MARKET INSIGHT - GIANNIS ANDRITSOPOULOS
During the duration of the first half of the year, the dry bulk market saw intense buying interest that boosted SnP prices significantly. We saw a ...
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Showing 1986 to 1990 news of total 6871 |
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- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Manunggal Multi Energi - Indonesia
- Jindal Steel & Power Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- Deloitte Consulting - India
- Larsen & Toubro Limited - India
- Aboitiz Power Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- Chamber of Mines of South Africa
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Thiess Contractors Indonesia
- Singapore Mercantile Exchange
- Ambuja Cements Ltd - India
- Malabar Cements Ltd - India
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Eastern Coal Council - USA
- The State Trading Corporation of India Ltd
- ICICI Bank Limited - India
- Gujarat Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- SMG Consultants - Indonesia
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercator Lines Limited - India
- SMC Global Power, Philippines
- San Jose City I Power Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Trasteel International SA, Italy
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Sakthi Sugars Limited - India
- Indogreen Group - Indonesia
- Semirara Mining and Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Energy Development Corp, Philippines
- Jaiprakash Power Ventures ltd
- Kapuas Tunggal Persada - Indonesia
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- Savvy Resources Ltd - HongKong
- Kepco SPC Power Corporation, Philippines
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- CNBM International Corporation - China
- Vijayanagar Sugar Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Therma Luzon, Inc, Philippines
- Coalindo Energy - Indonesia
- Posco Energy - South Korea
- Thai Mozambique Logistica
- Medco Energi Mining Internasional
- Madhucon Powers Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Neyveli Lignite Corporation Ltd, - India
- Xindia Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- Star Paper Mills Limited - India
- Sinarmas Energy and Mining - Indonesia
- IEA Clean Coal Centre - UK
- Cement Manufacturers Association - India
- PTC India Limited - India
- Sree Jayajothi Cements Limited - India
- McConnell Dowell - Australia
- Carbofer General Trading SA - India
- Kumho Petrochemical, South Korea
- Rio Tinto Coal - Australia
- Parliament of New Zealand
- Global Coal Blending Company Limited - Australia
- Maheswari Brothers Coal Limited - India
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- MS Steel International - UAE
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Straits Asia Resources Limited - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Romanian Commodities Exchange
- Sical Logistics Limited - India
- Borneo Indobara - Indonesia
- Coal and Oil Company - UAE
- Ministry of Finance - Indonesia
- Kartika Selabumi Mining - Indonesia
- Altura Mining Limited, Indonesia
- Essar Steel Hazira Ltd - India
- Chettinad Cement Corporation Ltd - India
- Metalloyd Limited - United Kingdom
- Bhushan Steel Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Makmur.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Planning Commission, India
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- India Bulls Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Edison Trading Spa - Italy
- Uttam Galva Steels Limited - India
- Banpu Public Company Limited - Thailand
- IHS Mccloskey Coal Group - USA
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- European Bulk Services B.V. - Netherlands
- Kideco Jaya Agung - Indonesia
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Economic Council, Georgia
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Mercuria Energy - Indonesia
- New Zealand Coal & Carbon
- Tamil Nadu electricity Board
- Latin American Coal - Colombia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- Heidelberg Cement - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Mintek Dendrill Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Toyota Tsusho Corporation, Japan
- Dalmia Cement Bharat India
- Gujarat Sidhee Cement - India
- Vedanta Resources Plc - India
- Bharathi Cement Corporation - India
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Central Java Power - Indonesia
- Eastern Energy - Thailand
- The University of Queensland
- Orica Australia Pty. Ltd.
- Mjunction Services Limited - India
- Electricity Authority, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Standard Chartered Bank - UAE
- PowerSource Philippines DevCo
- Kaltim Prima Coal - Indonesia
- Central Electricity Authority - India
- GVK Power & Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- Wilmar Investment Holdings
- Ministry of Transport, Egypt
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- Semirara Mining Corp, Philippines
- Global Business Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- Ind-Barath Power Infra Limited - India
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Meenaskhi Energy Private Limited - India
- Oldendorff Carriers - Singapore
- Holcim Trading Pte Ltd - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Bulk Trading Sa - Switzerland
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Directorate Of Revenue Intelligence - India
- Ministry of Mines - Canada
- Videocon Industries ltd - India
- Parry Sugars Refinery, India
- Salva Resources Pvt Ltd - India
- Baramulti Group, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- White Energy Company Limited
- South Luzon Thermal Energy Corporation
- SN Aboitiz Power Inc, Philippines
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- Africa Commodities Group - South Africa
- Renaissance Capital - South Africa
- Minerals Council of Australia
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