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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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Monday, 09 February 15
Q2' CFR SOUTH CHINA COAL SWAP DECLINED 3.28% TO $ 56.92 W-O-W
COALspot.com: API 8 CFR South China Coal swap for Q2’ 2015 delivery declined US$ 1.93 (-3.28%) per MT month over month and US$ 0.10 (-0 ...
Sunday, 08 February 15
BDI FELL CONTINUOUSLY HIT A THREE DECADES LOW
COALspot.com: This week Baltic Exchange Dry Freight Index (BDI) fell continuously hit a three decades low.
The BDI continuously fell and was d ...
Friday, 06 February 15
WEEKLY U.S. COAL PRODUCTION UP AN ESTIMATED 1.1% FROM LAST WEEK - EIA
COALspot.com – United States the world's one of the largest coal producers, produced approximately 20.1 million short tons (mmst) of coal ...
Friday, 06 February 15
SHIP DAMAGED BY FIRE CAUSED BY PIRATES FOUND TO BE CONSTRUCTIVE TOTAL LOSS - TAYLOR WESSING
KNOWLEDGE TO ELEVATE
The High Court was asked to determine a number of preliminary issues, including whether a vessel was a constructive total ...
Thursday, 05 February 15
BDI HAS NOW FALLEN A LEVEL CLOSE TO THE INDEX'S HISTORIC LOW - INTERMODAL
They say a picture is worth a thousand words and in this instance just one look at the tables above is enough to understand the great pressure the ...
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Showing 3211 to 3215 news of total 6871 |
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- Kartika Selabumi Mining - Indonesia
- Central Java Power - Indonesia
- Kepco SPC Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- MS Steel International - UAE
- Cigading International Bulk Terminal - Indonesia
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- Minerals Council of Australia
- Wood Mackenzie - Singapore
- Commonwealth Bank - Australia
- GN Power Mariveles Coal Plant, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mjunction Services Limited - India
- PowerSource Philippines DevCo
- Kaltim Prima Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- Independent Power Producers Association of India
- Aboitiz Power Corporation - Philippines
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- PNOC Exploration Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Australian Coal Association
- Electricity Authority, New Zealand
- Global Green Power PLC Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- The State Trading Corporation of India Ltd
- Krishnapatnam Port Company Ltd. - India
- Sical Logistics Limited - India
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- Uttam Galva Steels Limited - India
- Antam Resourcindo - Indonesia
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bangladesh Power Developement Board
- Barasentosa Lestari - Indonesia
- Mintek Dendrill Indonesia
- Sojitz Corporation - Japan
- Billiton Holdings Pty Ltd - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Goldman Sachs - Singapore
- Therma Luzon, Inc, Philippines
- PTC India Limited - India
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Aditya Birla Group - India
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Bharathi Cement Corporation - India
- VISA Power Limited - India
- Xindia Steels Limited - India
- Latin American Coal - Colombia
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- Holcim Trading Pte Ltd - Singapore
- Orica Mining Services - Indonesia
- Madhucon Powers Ltd - India
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Vizag Seaport Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Bukit Baiduri Energy - Indonesia
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- Power Finance Corporation Ltd., India
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Formosa Plastics Group - Taiwan
- McConnell Dowell - Australia
- SMG Consultants - Indonesia
- Africa Commodities Group - South Africa
- Anglo American - United Kingdom
- Attock Cement Pakistan Limited
- Jaiprakash Power Ventures ltd
- Renaissance Capital - South Africa
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- Agrawal Coal Company - India
- Borneo Indobara - Indonesia
- The University of Queensland
- Baramulti Group, Indonesia
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- GVK Power & Infra Limited - India
- Mercator Lines Limited - India
- India Bulls Power Limited - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- Rio Tinto Coal - Australia
- Dalmia Cement Bharat India
- Directorate Of Revenue Intelligence - India
- European Bulk Services B.V. - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Eastern Energy - Thailand
- Coastal Gujarat Power Limited - India
- Economic Council, Georgia
- Gujarat Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- Kohat Cement Company Ltd. - Pakistan
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Parry Sugars Refinery, India
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GMR Energy Limited - India
- Energy Link Ltd, New Zealand
- Straits Asia Resources Limited - Singapore
- Ministry of Mines - Canada
- Larsen & Toubro Limited - India
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- Sinarmas Energy and Mining - Indonesia
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Planning Commission, India
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Kumho Petrochemical, South Korea
- Tata Chemicals Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Sakthi Sugars Limited - India
- Marubeni Corporation - India
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- Binh Thuan Hamico - Vietnam
- Georgia Ports Authority, United States
- Orica Australia Pty. Ltd.
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- Standard Chartered Bank - UAE
- Romanian Commodities Exchange
- OPG Power Generation Pvt Ltd - India
- Siam City Cement - Thailand
- Siam City Cement PLC, Thailand
- Bhatia International Limited - India
- Sarangani Energy Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- GAC Shipping (India) Pvt Ltd
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Heidelberg Cement - Germany
- Indonesian Coal Mining Association
- TNB Fuel Sdn Bhd - Malaysia
- Indika Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Kobexindo Tractors - Indoneisa
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Chamber of Mines of South Africa
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Coalindo Energy - Indonesia
- CNBM International Corporation - China
- New Zealand Coal & Carbon
- Indian Oil Corporation Limited
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