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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, 15 July 15
SAS TO BUILD 108 KM ROAD FOR COAL IN JAMBI, SAYS JAKARTA POST
Jambi Governor Hasan Basri Agus said on Sunday that mining company PT Sinar Anugerah Sukses (SAS) would develop a 108-kilometer road with a width o ...
Wednesday, 15 July 15
ANY FUTURE IRAN OIL DEAL WILL BOOST SUPPLY FUNDAMENTALS WITH TANKER OWNERS HOPING FROM TEHRAN TO QUICKLY BOOST ITS PRODUCTION
With the Greek “Euro-drama” apparently over, at least for now, Iran’s oil deal still remains elusive, with any potential agreemen ...
Tuesday, 14 July 15
FOB NEWCASTLE COAL SWAPS MAINTAIN OVERALL NEGATIVE TONE THIS PAST WEEK
COALspot.com: API 5 FOB Newcastle Coal swap for Q3’ 2015 delivery down $ 1.02 per MT (-2.23%) month over month to US$ 44.68 per mt. The swap ...
Tuesday, 14 July 15
CFR SOUTH CHINA COAL SWAPS DECLINE THIS PAST WEEK
COALspot.com: API 8 CFR South China Coal swap for Q3’ 2015 delivery declined US$ 1.47 (2.82%) per MT month over month.
A commodity swap ...
Monday, 13 July 15
THERMAL COAL IMPORTS SOAR 23 PER CENT TO 24.08 MILLION TONNES AT 12 MAJOR INDIAN PORTS
Import of thermal coal jumped 23 per cent to 24.08 million tonnes at 12 major ports in the first quarter of the fiscal, even as the government cont ...
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Showing 2926 to 2930 news of total 6871 |
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- Pendopo Energi Batubara - Indonesia
- Global Business Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Maheswari Brothers Coal Limited - India
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- Lanco Infratech Ltd - India
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Parry Sugars Refinery, India
- Simpson Spence & Young - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Standard Chartered Bank - UAE
- Karbindo Abesyapradhi - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- India Bulls Power Limited - India
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Central Electricity Authority - India
- ASAPP Information Group - India
- Latin American Coal - Colombia
- Ministry of Mines - Canada
- Attock Cement Pakistan Limited
- Wilmar Investment Holdings
- Cement Manufacturers Association - India
- Barasentosa Lestari - Indonesia
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- The Treasury - Australian Government
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Electricity Generating Authority of Thailand
- Africa Commodities Group - South Africa
- Eastern Energy - Thailand
- Indonesian Coal Mining Association
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Ministry of Finance - Indonesia
- Petron Corporation, Philippines
- Uttam Galva Steels Limited - India
- SN Aboitiz Power Inc, Philippines
- Indika Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Riau Bara Harum - Indonesia
- Salva Resources Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Agrawal Coal Company - India
- Kepco SPC Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- Coastal Gujarat Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Sarangani Energy Corporation, Philippines
- Antam Resourcindo - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- Edison Trading Spa - Italy
- Toyota Tsusho Corporation, Japan
- Kalimantan Lumbung Energi - Indonesia
- South Luzon Thermal Energy Corporation
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Binh Thuan Hamico - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- Trasteel International SA, Italy
- Power Finance Corporation Ltd., India
- Port Waratah Coal Services - Australia
- Altura Mining Limited, Indonesia
- Star Paper Mills Limited - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Bukit Baiduri Energy - Indonesia
- Bhushan Steel Limited - India
- San Jose City I Power Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Indian Energy Exchange, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- White Energy Company Limited
- Vizag Seaport Private Limited - India
- Tata Chemicals Ltd - India
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Globalindo Alam Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Cigading International Bulk Terminal - Indonesia
- Independent Power Producers Association of India
- Thiess Contractors Indonesia
- New Zealand Coal & Carbon
- Renaissance Capital - South Africa
- Carbofer General Trading SA - India
- Australian Coal Association
- Jindal Steel & Power Ltd - India
- Electricity Authority, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- CIMB Investment Bank - Malaysia
- Ceylon Electricity Board - Sri Lanka
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- Sakthi Sugars Limited - India
- Indo Tambangraya Megah - Indonesia
- Kideco Jaya Agung - Indonesia
- Bayan Resources Tbk. - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- Aditya Birla Group - India
- Medco Energi Mining Internasional
- Economic Council, Georgia
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- Alfred C Toepfer International GmbH - Germany
- Aboitiz Power Corporation - Philippines
- Siam City Cement PLC, Thailand
- PNOC Exploration Corporation - Philippines
- Bangladesh Power Developement Board
- Oldendorff Carriers - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sojitz Corporation - Japan
- AsiaOL BioFuels Corp., Philippines
- ICICI Bank Limited - India
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- TeaM Sual Corporation - Philippines
- GVK Power & Infra Limited - India
- Baramulti Group, Indonesia
- London Commodity Brokers - England
- Banpu Public Company Limited - Thailand
- Jorong Barutama Greston.PT - Indonesia
- VISA Power Limited - India
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Commonwealth Bank - Australia
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- Makarim & Taira - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Georgia Ports Authority, United States
- MS Steel International - UAE
- Kartika Selabumi Mining - Indonesia
- McConnell Dowell - Australia
- Ministry of Transport, Egypt
- International Coal Ventures Pvt Ltd - India
- Orica Mining Services - Indonesia
- Sical Logistics Limited - India
- Karaikal Port Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Anglo American - United Kingdom
- Directorate Of Revenue Intelligence - India
- Global Green Power PLC Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Marubeni Corporation - India
- PTC India Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Mineral Development Corp Ltd - India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Central Java Power - Indonesia
- Savvy Resources Ltd - HongKong
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Larsen & Toubro Limited - India
- Minerals Council of Australia
- Bulk Trading Sa - Switzerland
- Goldman Sachs - Singapore
- Bharathi Cement Corporation - India
- The University of Queensland
- Kobexindo Tractors - Indoneisa
- Malabar Cements Ltd - India
- Australian Commodity Traders Exchange
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