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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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Friday, 20 April 12
PANAMAXES LEAD DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A rebound of demand for smaller dry bulk carriers has led the industry’s benchmark, the BDI (Baltic Dry Index) above the 1,000-point mark for ...
Friday, 20 April 12
BUMA HAS PRODUCED 2.6 MILLION TONS OF COAL IN MARCH 2012
COALspot.com - BUMA has removed 28.0 million bcm (+6.4% YoY) of overburden in March 2012 while coal production was at 2.6 million tons (+1.3% YoY).
...
Thursday, 19 April 12
FRESH COAL SALES FROM JATENERGYS JONGKANG MINES
COALspot.com - Energy company Jatenergy Ltd (ASX code JAT) announced today that it had signed a contract for an 11,000 tonne coal sale due for shipm ...
Thursday, 19 April 12
HANDY - 'POSITIVE TREND', PANAMAX - 'A FIRMER TENDENCY', CAPESIZE - 'AGAIN NEGATIVE'
Handy
The positive trend from last week continued, with more cargoes entering the market. Skaw/Passero del fixed tick above USD 4000 for US Gulf di ...
Thursday, 19 April 12
WILLIS MARINE MARKET REVIEW FORECASTS ANOTHER DIFFICULT YEAR - WILLIS GLOBAL MARINE / HELLENIC SHIPPING
After an inauspicious start, 2012 could well be "another difficult and uncertain year for the maritime industry faced with the aftermath of the ...
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- Makarim & Taira - Indonesia
- Independent Power Producers Association of India
- Alfred C Toepfer International GmbH - Germany
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Mercuria Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Madhucon Powers Ltd - India
- PNOC Exploration Corporation - Philippines
- Deloitte Consulting - India
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Timah Investasi Mineral - Indoneisa
- Goldman Sachs - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Romanian Commodities Exchange
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Malabar Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- CIMB Investment Bank - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- SN Aboitiz Power Inc, Philippines
- Borneo Indobara - Indonesia
- Jaiprakash Power Ventures ltd
- Essar Steel Hazira Ltd - India
- Gujarat Sidhee Cement - India
- Therma Luzon, Inc, Philippines
- Medco Energi Mining Internasional
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Antam Resourcindo - Indonesia
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Larsen & Toubro Limited - India
- Neyveli Lignite Corporation Ltd, - India
- The University of Queensland
- Bukit Makmur.PT - Indonesia
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- Globalindo Alam Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vizag Seaport Private Limited - India
- Riau Bara Harum - Indonesia
- Directorate Of Revenue Intelligence - India
- Indonesian Coal Mining Association
- Bharathi Cement Corporation - India
- Ministry of Finance - Indonesia
- ICICI Bank Limited - India
- Renaissance Capital - South Africa
- Jindal Steel & Power Ltd - India
- Sakthi Sugars Limited - India
- Vedanta Resources Plc - India
- Indika Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Minerals Council of Australia
- PTC India Limited - India
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chettinad Cement Corporation Ltd - India
- Bhoruka Overseas - Indonesia
- Karaikal Port Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Rio Tinto Coal - Australia
- Xindia Steels Limited - India
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Iligan Light & Power Inc, Philippines
- Orica Australia Pty. Ltd.
- Sindya Power Generating Company Private Ltd
- IHS Mccloskey Coal Group - USA
- Bahari Cakrawala Sebuku - Indonesia
- Parry Sugars Refinery, India
- Bulk Trading Sa - Switzerland
- Kapuas Tunggal Persada - Indonesia
- Aboitiz Power Corporation - Philippines
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Sical Logistics Limited - India
- Toyota Tsusho Corporation, Japan
- Tamil Nadu electricity Board
- Mintek Dendrill Indonesia
- Marubeni Corporation - India
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Posco Energy - South Korea
- PowerSource Philippines DevCo
- Aditya Birla Group - India
- Electricity Authority, New Zealand
- Indogreen Group - Indonesia
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Singapore Mercantile Exchange
- Sojitz Corporation - Japan
- Ministry of Transport, Egypt
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- Billiton Holdings Pty Ltd - Australia
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Eastern Coal Council - USA
- Cement Manufacturers Association - India
- Straits Asia Resources Limited - Singapore
- GAC Shipping (India) Pvt Ltd
- Metalloyd Limited - United Kingdom
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- Coastal Gujarat Power Limited - India
- Parliament of New Zealand
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- San Jose City I Power Corp, Philippines
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Indian Oil Corporation Limited
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Ambuja Cements Ltd - India
- Attock Cement Pakistan Limited
- Mercator Lines Limited - India
- IEA Clean Coal Centre - UK
- The Treasury - Australian Government
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- White Energy Company Limited
- Global Green Power PLC Corporation, Philippines
- Commonwealth Bank - Australia
- New Zealand Coal & Carbon
- Pendopo Energi Batubara - Indonesia
- Ind-Barath Power Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Orica Mining Services - Indonesia
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Semirara Mining Corp, Philippines
- Price Waterhouse Coopers - Russia
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Sinarmas Energy and Mining - Indonesia
- Latin American Coal - Colombia
- GN Power Mariveles Coal Plant, Philippines
- Lanco Infratech Ltd - India
- Sarangani Energy Corporation, Philippines
- Grasim Industreis Ltd - India
- VISA Power Limited - India
- Anglo American - United Kingdom
- Binh Thuan Hamico - Vietnam
- OPG Power Generation Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Bangladesh Power Developement Board
- Bukit Baiduri Energy - Indonesia
- Carbofer General Trading SA - India
- MS Steel International - UAE
- Dalmia Cement Bharat India
- Electricity Generating Authority of Thailand
- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Wilmar Investment Holdings
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- GVK Power & Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- CNBM International Corporation - China
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Krishnapatnam Port Company Ltd. - India
- Georgia Ports Authority, United States
- Bhatia International Limited - India
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