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Thursday, 05 April 12
COAL EXPORT TAX: MATTER OF CONCERN FOR INDIA - SUNIL K KUMBHAT
 COALspot.com - Since the issuance of Indonesian Mining law in 2009, miners have increased their activities in exploring , exploiting and exporting all types of minerals,specially Black Gold –Coal.
In order to regulate the mining sector , the Goverment of Indonesia has announced a series of new mining regulations, including a ban on exports of some unprocessed metals and low-grade Coal from 2014 , which is designed to spur investment in mineral processing .The proposed ban on exports of coal under the 5,700-kcal/kg from Jan 2014 will change the dynamics of the global thermal coal market, which has seen spiralling demand from China and India. Such a ban will have a substantial impact on the thermal coal market, as large amounts of low-quality coal from Indonesia are exported to India and China.
Another Goverment regulation known as GR 24 of 2012 ( Amendment of GR 23 of 2010 ), signed by President of Indonesia on Feb. 21,2012 stipulates that foreign shareholders/ Companies must gradually divest 51 percent of their shares in local mining companies to local investors after the fifth year of commercial production and complete the divestment by the 10th year of production. The divestment regulation resulted from a revision to a earlier GR 23 of 2010 that required foreign shareholders in local mineral and coal mining companies to divest 20 percent of their holdings.
In a latest move The Goverment of Indonesia now plans to impose a tax of 25% on export of coal and base metals during the current year, and increase it to 50% in 2013. The step is to boost investment in the downstream industry of metal and mining sectors. It is also expected to restrict the exports of mineral and ore metal shipment.The date of implementing the regulation and calculating the Export tax is yet to announced.
Indonesian Government is capitalizing on the mining boom driven by high demand of thermal Coal from China and India . Inspite of series of Taxes , the proposed Export tax is designed to restrict the production and also share profit on the minerals being mined. Coal prices are increasing due to huge requirement and inadequate global production capacity. Govt of Indonesia is encashing the Global situation of demand and supply .Coal will remain hot commodity and Indonesia as heart of Coal Boom.
If the proposed tax is implemented , it is definitely cause of serious concern , particularly for Indian buyers. India is a major buyer of Indonesian thermal coal, along with are China, South Korea, Japan .This is a wake-up call for all the foreign miners operating in Indonesia specially for Coal, that gone are the days of soft and flexible regulations.It is also wake up call for country like India that slow environmental ,forestery clearances and land acquisition issues ,if not sorted out will led to stagnating coal production in India which will resultinto increased dependence on imports, specially from Indnonesia , Australia and south Africa.
Never before India has such a high demand for coal, so also environmental consciousness been so high. Both are legitimate & serious issues but the solution is not to clamp down on coal production. India’s soaring energy need is vital for its industrial growth.
The magnitude of growth in power generation in India will necessarily mean that coal demand will remain very strong. Coal will remain life line for Indian economy for coming many decades till 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.
As the situation stands today, India could become the world’s biggest thermal coal importer by 2015 and Indonesia would be one of the Countries to take care of bulk of coal requirement.
India is today one of the fastest growing economies and also has a shortage of power supply. Indonesia is one of the countries with huge natural resources and exporting thermal coal to many countries for use in power plants for generating energy but it is paradoxical that Indonesia is short of energy. Many Indian companies are capable of sharing power technology and setting up mega power plants in Indonesia
Indonesian private companies can buy equity stakes in India’s power plants in exchange for long-term coal supply. Since India is today one of the fastest growing economies and also has a shortage of power supply then such deals can be beneficial to both parties.
Indonesia requires huge investment from foreign investors in infrastructure, Power Generation, Oil & Gas exploration, telecom sector, Port and Rapid transport system. So it is essential to have transparency in all regulations, legal system and improvement in corporate Governance. Indonesia's mining industry is undergoing a regulatory overhaul which may weaken the operating health and financial performance of many domestic mining companies.
Besides increased operating uncertainty, the new regulations of recent past & proposed may also make the mining industry less attractive to foreign investors. Foreign investor is likly to seriouly question the Safety and Security of their investment in mining sector considering the regulations of the recent past. Lack of transparency in the legal process and the risk of regulatory duplication and inconsistencies will continue to act as deterrents to substantial investment ,specially foreign direct investments (FDI).
As the situation stands today next couple of years shall be very challening for foreign companies operating in Mining sector in Indonesia.
The present proposed tax would hit the profits of both domestic and foreign-owned companies and would heavily raise costs for importers.
The market analysts and experts in mining sector are skeptical about all the mining regulations and plans announced in recent past.
By: Sunil K Kumbhat , Jodhpur (Rajasthan) India
Views expressed herein are personal views of the author and not that of COALspot.com.
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Tuesday, 01 May 12
VIETNAM FEARS IT MAY NOT SEEK COAL SUPPLIES - TBKTSG / VIETNAMNET BRIDGE
TBKTSG / VietNamNet Bridge reported that, with five coal-run thermopower plants under construction, PetroVietnam alone would need 18 million tons of ...
Sunday, 29 April 12
THE FREIGHT MARKET EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - The BDI continued to go up with the support of Panamax/Supramax and was up by 8.34 pct closing at 1,156 points.
The cape index was ...
Sunday, 29 April 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS FOR MAY 2012 DELIVERY WAS STABLE THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps for May deliveries stable this week, according to DSP of SGX AsiaClear OTC Coal Swaps. In the me ...
Friday, 27 April 12
BUKIT ASAMS NET INCOME UP 14% IN 1Q 2012 (UNAUDITED)
Press Release - PT Bukit Asam (Persero) Tbk, announced the Consolidated Financial Statements and Subsidiaries per 31 March 2012 (Unaudited).
Reve ...
Thursday, 26 April 12
AUSTRALIAS COKAL EXPANDS MET COAL POTENTIAL INTO WEST KALIMANTAN
COALspot.com - Global metallurgical coal group Cokal Limited (Cokal) (ASX:CKA) announced today it has completed the acquisition of 75.2% of PT Silan ...
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- Formosa Plastics Group - Taiwan
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- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- Parry Sugars Refinery, India
- Globalindo Alam Lestari - Indonesia
- Uttam Galva Steels Limited - India
- The University of Queensland
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- PetroVietnam Power Coal Import and Supply Company
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- Global Business Power Corporation, Philippines
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- Dong Bac Coal Mineral Investment Coporation - Vietnam
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- Agrawal Coal Company - India
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- Energy Development Corp, Philippines
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- Aboitiz Power Corporation - Philippines
- Eastern Coal Council - USA
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
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- Romanian Commodities Exchange
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- Videocon Industries ltd - India
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- Chamber of Mines of South Africa
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- PNOC Exploration Corporation - Philippines
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- Grasim Industreis Ltd - India
- Standard Chartered Bank - UAE
- Indian Energy Exchange, India
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Siam City Cement PLC, Thailand
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- Georgia Ports Authority, United States
- Jaiprakash Power Ventures ltd
- McConnell Dowell - Australia
- Kobexindo Tractors - Indoneisa
- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- Electricity Authority, New Zealand
- Samtan Co., Ltd - South Korea
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- The State Trading Corporation of India Ltd
- Trasteel International SA, Italy
- Petron Corporation, Philippines
- Heidelberg Cement - Germany
- Posco Energy - South Korea
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Vizag Seaport Private Limited - India
- Australian Commodity Traders Exchange
- Vedanta Resources Plc - India
- Australian Coal Association
- Sree Jayajothi Cements Limited - India
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- European Bulk Services B.V. - Netherlands
- Coastal Gujarat Power Limited - India
- Planning Commission, India
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- OPG Power Generation Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Makarim & Taira - Indonesia
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Indian Oil Corporation Limited
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Ceylon Electricity Board - Sri Lanka
- Edison Trading Spa - Italy
- Parliament of New Zealand
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Star Paper Mills Limited - India
- GVK Power & Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Global Green Power PLC Corporation, Philippines
- Latin American Coal - Colombia
- Mintek Dendrill Indonesia
- Thai Mozambique Logistica
- The Treasury - Australian Government
- Essar Steel Hazira Ltd - India
- SMG Consultants - Indonesia
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- Sojitz Corporation - Japan
- Thiess Contractors Indonesia
- Barasentosa Lestari - Indonesia
- Oldendorff Carriers - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Ministry of Transport, Egypt
- CNBM International Corporation - China
- GN Power Mariveles Coal Plant, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Mercuria Energy - Indonesia
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Price Waterhouse Coopers - Russia
- Global Coal Blending Company Limited - Australia
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Bayan Resources Tbk. - Indonesia
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- Vijayanagar Sugar Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Indonesian Coal Mining Association
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
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- VISA Power Limited - India
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- CIMB Investment Bank - Malaysia
- Directorate Of Revenue Intelligence - India
- Bhatia International Limited - India
- Semirara Mining Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Meralco Power Generation, Philippines
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- Attock Cement Pakistan Limited
- Karaikal Port Pvt Ltd - India
- Ambuja Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- London Commodity Brokers - England
- Port Waratah Coal Services - Australia
- Intertek Mineral Services - Indonesia
- Sarangani Energy Corporation, Philippines
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- Sindya Power Generating Company Private Ltd
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- IHS Mccloskey Coal Group - USA
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