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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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Wednesday, 11 April 12
TWO PERCENT OF IBP CONCESSION CONTAINS 42 MMT OF COAL
COALspot.com - 42.35 million ton of coal found in just 2% of PT Insani Bara Perkasa’s total concession area of 24,477 hectare.
Accord ...
Wednesday, 11 April 12
DRY BULK MARKET STILL SUBDUED, RECOVERY NOT YET SEEN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market entered the new week after the past days of easter holidays in western countries in a subdued mood. The industry’s benchma ...
Monday, 09 April 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The first week of April ended with the Baltic Dry Index falling below 950 points, before Catholic Easter, and capesizes showing a modest upturn with ...
Sunday, 08 April 12
CHARTER RATES COULD CONTINUE TO BE SOFT NEXT WEEK - VISTAAR
COALspot.com - The BDI was almost at same levels closing slightly lower by 0.64 pct at 928 points.
The Cape index was up by 6.73 pct closing at ...
Friday, 06 April 12
INDONESIAN HBA FALL TO LOWEST LEVEL SINCE JANUARY 2011
COALspot.com - Indonesian HBA fall to lowest level since January 2011 this month. The monthly coal reference price for coal sales in April fal ...
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- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- Agrawal Coal Company - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Siam City Cement - Thailand
- Bukit Makmur.PT - Indonesia
- New Zealand Coal & Carbon
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- Indika Energy - Indonesia
- Bangladesh Power Developement Board
- ICICI Bank Limited - India
- Mercator Lines Limited - India
- MS Steel International - UAE
- SMC Global Power, Philippines
- Leighton Contractors Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- Bhushan Steel Limited - India
- Kumho Petrochemical, South Korea
- Jaiprakash Power Ventures ltd
- Indian Energy Exchange, India
- Independent Power Producers Association of India
- Parry Sugars Refinery, India
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Development Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- Semirara Mining and Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Power Finance Corporation Ltd., India
- European Bulk Services B.V. - Netherlands
- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
- Lanco Infratech Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Australia Pty. Ltd.
- Orica Mining Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Oldendorff Carriers - Singapore
- Global Coal Blending Company Limited - Australia
- Semirara Mining Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bayan Resources Tbk. - Indonesia
- Tamil Nadu electricity Board
- The University of Queensland
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- TeaM Sual Corporation - Philippines
- India Bulls Power Limited - India
- CNBM International Corporation - China
- PNOC Exploration Corporation - Philippines
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- Economic Council, Georgia
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- Parliament of New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Carbofer General Trading SA - India
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vizag Seaport Private Limited - India
- Makarim & Taira - Indonesia
- White Energy Company Limited
- Bhatia International Limited - India
- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- ASAPP Information Group - India
- Bhoruka Overseas - Indonesia
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Toyota Tsusho Corporation, Japan
- VISA Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Mintek Dendrill Indonesia
- Port Waratah Coal Services - Australia
- Commonwealth Bank - Australia
- Altura Mining Limited, Indonesia
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Indian Oil Corporation Limited
- Meenaskhi Energy Private Limited - India
- GMR Energy Limited - India
- Planning Commission, India
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- Manunggal Multi Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Eastern Coal Council - USA
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Ministry of Transport, Egypt
- Indogreen Group - Indonesia
- The State Trading Corporation of India Ltd
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- Jindal Steel & Power Ltd - India
- Essar Steel Hazira Ltd - India
- Price Waterhouse Coopers - Russia
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Karaikal Port Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- Africa Commodities Group - South Africa
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Georgia Ports Authority, United States
- CIMB Investment Bank - Malaysia
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Riau Bara Harum - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Billiton Holdings Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Simpson Spence & Young - Indonesia
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Indonesian Coal Mining Association
- Star Paper Mills Limited - India
- Alfred C Toepfer International GmbH - Germany
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Samtan Co., Ltd - South Korea
- Madhucon Powers Ltd - India
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Intertek Mineral Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- McConnell Dowell - Australia
- Uttam Galva Steels Limited - India
- AsiaOL BioFuels Corp., Philippines
- LBH Netherlands Bv - Netherlands
- Interocean Group of Companies - India
- Ind-Barath Power Infra Limited - India
- Heidelberg Cement - Germany
- Meralco Power Generation, Philippines
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- South Luzon Thermal Energy Corporation
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Binh Thuan Hamico - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Ambuja Cements Ltd - India
- Dalmia Cement Bharat India
- Vijayanagar Sugar Pvt Ltd - India
- Standard Chartered Bank - UAE
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Barasentosa Lestari - Indonesia
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