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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, 13 July 17
SUPRAMAX: NICKEL ORE TRIPS TO CHINA VIA PHILIPPINES WITH DELIVERY S. CHINA IS PAYING AROUND MID $9000 - FEARNLEYS
Supramax
COALspot.com: Another slow start to the week with somewhat softening rates and few fixtures.
Nickel Ore trips to China via the Phil ...
Wednesday, 12 July 17
COAL HAS CONTINUED A STELLAR RUN OVER THE PAST YEAR GAINING ~10% OVER THE PAST QUARTER AND ~41% OVER THE PAST YEAR - LINOS KOGEVINAS
Having just passed the second quarter of 2017, it is interesting to take a look at the performance of the commodity market and how certain commodit ...
Monday, 10 July 17
A ROLLERCOASTER YEAR FOR COAL PRICES; ICPR ROSE 4.62% M/M
COALspot.com: Indonesian coal benchmark price rose 4.62% in July, government data showed.
The benchmark price of Indonesian thermal c ...
Monday, 10 July 17
THE FREIGHT MARKET WAS SHOWS A NEGATIVE TREND WEEK OVER WEEK
COALspot.com: The Freight market decline this past week compared to the previous week, as BDI and Cape indexes show a negative trend week over week ...
Friday, 07 July 17
SHOULD WE BE AVOIDING GENERAL AVERAGE? - ALEX KEMP
KNOWLEDGE TO ELEVATE
Calls for general average to be abolished are nearly as old as the regime itself. A representative of Lloyd’s atten ...
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Showing 2006 to 2010 news of total 6871 |
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- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Star Paper Mills Limited - India
- Merrill Lynch Commodities Europe
- ASAPP Information Group - India
- Rashtriya Ispat Nigam Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Jaiprakash Power Ventures ltd
- Gujarat Mineral Development Corp Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Savvy Resources Ltd - HongKong
- Meralco Power Generation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Deloitte Consulting - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Wood Mackenzie - Singapore
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Gujarat Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Iligan Light & Power Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indian Energy Exchange, India
- Bukit Makmur.PT - Indonesia
- Central Java Power - Indonesia
- Coastal Gujarat Power Limited - India
- TeaM Sual Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- Global Coal Blending Company Limited - Australia
- CIMB Investment Bank - Malaysia
- Therma Luzon, Inc, Philippines
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Port Waratah Coal Services - Australia
- Renaissance Capital - South Africa
- San Jose City I Power Corp, Philippines
- Borneo Indobara - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- TNB Fuel Sdn Bhd - Malaysia
- Altura Mining Limited, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Energy Link Ltd, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Karaikal Port Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Formosa Plastics Group - Taiwan
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Maheswari Brothers Coal Limited - India
- Bayan Resources Tbk. - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- Ministry of Transport, Egypt
- Krishnapatnam Port Company Ltd. - India
- McConnell Dowell - Australia
- Parliament of New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- Billiton Holdings Pty Ltd - Australia
- Ind-Barath Power Infra Limited - India
- Edison Trading Spa - Italy
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Romanian Commodities Exchange
- Africa Commodities Group - South Africa
- Videocon Industries ltd - India
- Marubeni Corporation - India
- MS Steel International - UAE
- Meenaskhi Energy Private Limited - India
- Orica Mining Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Aboitiz Power Corporation - Philippines
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- Trasteel International SA, Italy
- The State Trading Corporation of India Ltd
- Aditya Birla Group - India
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Bhushan Steel Limited - India
- Global Business Power Corporation, Philippines
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Mintek Dendrill Indonesia
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Bangladesh Power Developement Board
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Eastern Coal Council - USA
- South Luzon Thermal Energy Corporation
- Interocean Group of Companies - India
- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Central Electricity Authority - India
- PTC India Limited - India
- PowerSource Philippines DevCo
- Riau Bara Harum - Indonesia
- Coal and Oil Company - UAE
- Wilmar Investment Holdings
- Ministry of Finance - Indonesia
- Kobexindo Tractors - Indoneisa
- IHS Mccloskey Coal Group - USA
- Uttam Galva Steels Limited - India
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- Siam City Cement - Thailand
- Chamber of Mines of South Africa
- Indika Energy - Indonesia
- Bhatia International Limited - India
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- Sakthi Sugars Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Sojitz Corporation - Japan
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Indo Tambangraya Megah - Indonesia
- Georgia Ports Authority, United States
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- Cement Manufacturers Association - India
- ICICI Bank Limited - India
- Cigading International Bulk Terminal - Indonesia
- Dalmia Cement Bharat India
- Thiess Contractors Indonesia
- Minerals Council of Australia
- Electricity Authority, New Zealand
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- India Bulls Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Mjunction Services Limited - India
- Planning Commission, India
- GMR Energy Limited - India
- Vedanta Resources Plc - India
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- Bhoruka Overseas - Indonesia
- International Coal Ventures Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Toyota Tsusho Corporation, Japan
- Electricity Generating Authority of Thailand
- GAC Shipping (India) Pvt Ltd
- Karbindo Abesyapradhi - Indoneisa
- Coalindo Energy - Indonesia
- Ambuja Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- Ministry of Mines - Canada
- Asmin Koalindo Tuhup - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Anglo American - United Kingdom
- Australian Coal Association
- GN Power Mariveles Coal Plant, Philippines
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