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Monday, 16 February 15
COAL MINING SLUMP A BLESSING IN DISGUISE - THE JAKARTA POST
 The growth of the coal-mining industry, which has diminished in the last two years, is expected to slump even further this year following weakening demand for coal in the world market. This has been worsened by the more recent tumbling price of oil as the world’s main source of energy, which has discouraged the conversion of energy use from oil to coal.
The diminishing growth of the coal-mining sector has contributed to a decline in government revenue over the last two years. Since coal has become Indonesia’s major export commodity, the weakening of coal exports has resulted in a declining trade performance of Indonesia’s non-oil and gas sector, and in turn, contributed to an overall trade deficit in the past three years.
However, the diminishing shine of the coal industry has its bright side. This is because the increasing amount of coal-mining activity in the past decade has not only resulted in serious environmental degradation, but also enhanced the proliferation of corrupt and clientelistic practices in the regions.
The previous rapid growth in coal demand not only benefited large coal-mining firms, but also increased the escalation and dispersion of small-scale coal mining activities, particularly after the decentralization of the coal sector in 2009. Law No.4/2009 on mineral and coal mining grants the province and district governments new authorities for issuing coal mining licenses for Indonesian companies, cooperatives or individuals, which covers an area of less than 50,000 hectares.
Since then, the magnitude of small-scale coal mining activities has increased tremendously. The Energy and Mineral Resources Ministry records that 9,662 permits were issued for small-scale coal mining by regencies as of 2011. Of these permits, only 3,778 were supported with the necessary documents without any outstanding legal issues.
Local governments have benefited from these mining operations through accepting large royalty payments from miners. In some coal-rich regencies, the revenues generated from coal royalties can be worth several times more than the contributions made by land and building taxes. The high profitability of small-scale coal mining has encouraged many regencies to allow these mining operations to operate without considering their detrimental impacts on the environment and the surrounding communities.
Many of these small open-pit coal mines are near residential areas, polluting rice fields and fish ponds and triggering landslides and floods.
Besides being an important source of local government revenue, coal has also become a source of funds for certain political groups close to local governments. Those who can obtain small-scale mining licenses in the regions are usually those who have some special or familial relationship with local government leaders, or are in some way connected to certain powerful local councilors.
Due to the high-cost politics associated with the direct elections of local government leaders since 2005, the money generated from small-scale coal mining activities has become an important source of political funding for government and political leaders participating in elections. An incumbent from a ruling political party can generate funds for a political campaign by developing a coal-mining business or issuing coal-mining licenses.
Apart from its high profitability, local politicians’ attraction to coal mining businesses is also due to the quick returns on investment compared to other booming commodities, such as palm oil. The quick returns generated by coal mining is very important for local politicians, who need to mobilize assets in anticipation of the local elections conducted every five years.
This high-cost politics and the local government’s lack of accountability have also provided a favorable environment for business actors and brokers to take advantage of the situation. Businessmen in the coal industry have often provided financial backing for the candidates for local government and legislative leaders who they think have a high chance of winning in the local elections, known as pilkada.
In exchange for financial backing, businessmen expect to gain rewards in the form of projects or certain policies in favor of their coal-mining business from the candidates they support, should they win the election.
Although the 2009 mining regulation has given greater opportunity for locals to obtain a mining permit, many have been reluctant to apply for a permit due to complications and bureaucratic red-tape in the processing of mining licenses. As a result, many locals choose to engage in illegal mining activities, frequently also supported by business actors, who serve as the financial backers and collectors of the coal extracted by local people.
These illegal activities have resulted in the extraction of millions of tons of coal per annum during its peak period.
Considering the serious problems resulting from the escalation and dispersion of coal-mining operations in the regions, the industry’s current downturn is a blessing in disguise. Weakening of coal demand has forced many coal-mining firms, particularly the illegal ones and the small- and medium-sized ones, to cease their operations.
This substantial reduction of coal-mining has reduced the frantic pace of exploitation and slowed environmental degradation in the last few years, which usually involves corrupt and clientelistic cooperation between businesses, government and political actors.
Nevertheless, if the government shows little concern for accountability and does not strengthen monitoring mechanisms overseeing the implementation of coal-sector decentralization, corrupt and clientelistic practices that have triggered rapid and careless coal exploitation will likely re-flourish once the demand for the commodity recovers. And undoubtedly, this condition is not only applicable to coal mining, but also to any other lucrative industry in Indonesia.
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The writer is the research director at the Center of Reform on Economics (CORE) Indonesia, Jakarta
Source: The Jakarta Post
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Friday, 20 February 15
U.S. PRODUCED AROUND 19.2 MILLION SHORT TONS OF COAL WEEK ON WEEK
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.2 million short tons (mmst) of coal ...
Thursday, 19 February 15
PANAMAX: NOPAC AND AUSSIE ROUNDS ARE DONE IN LOW/MID $ 4000; TRIPS VIA INDONESIA TO INDIA CLOSER TO THE $5000 MARK - FEARNLEYS
Handy
The handy and supra market has not seen any firming rates in front of the Chinese New Year and still suffering on low activity in both hemi ...
Wednesday, 18 February 15
DRY BULK SHIPPING TO RECOVER IN LATE 2015 - DREWRY MARITIME RESEARCH
Strong trade growth, moderating fleet development and deployment of new fuel efficient vessels are expected to lead to a recovery in dry bulk shipp ...
Tuesday, 17 February 15
WHO PAYS THE SUEZ CANAL FEES? - INCE & CO
KNOWLEDGE TO ELEVATE
This was an appeal from an arbitration award on a point of construction in relation to the wording of an addendum to a ch ...
Tuesday, 17 February 15
BUOYANT WAVES IN RECENT YEARS: GLOBAL SHIP INVESTMENT SINCE THE CRASH - HELLENIC SHIPPING NEWS
Anxiety about fleet expansion is a recurring feature of world shipping markets. Within the global maritime community, worries about the vast amount ...
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- AsiaOL BioFuels Corp., Philippines
- Central Java Power - Indonesia
- Metalloyd Limited - United Kingdom
- Ind-Barath Power Infra Limited - India
- Meralco Power Generation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aditya Birla Group - India
- Bukit Makmur.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Gujarat Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- Siam City Cement - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Essar Steel Hazira Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Indogreen Group - Indonesia
- Mintek Dendrill Indonesia
- Ceylon Electricity Board - Sri Lanka
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Trasteel International SA, Italy
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Electricity Authority, New Zealand
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Merrill Lynch Commodities Europe
- Economic Council, Georgia
- IHS Mccloskey Coal Group - USA
- Eastern Energy - Thailand
- Kartika Selabumi Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Intertek Mineral Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Medco Energi Mining Internasional
- Singapore Mercantile Exchange
- MS Steel International - UAE
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- London Commodity Brokers - England
- Savvy Resources Ltd - HongKong
- Meenaskhi Energy Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Standard Chartered Bank - UAE
- Miang Besar Coal Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GMR Energy Limited - India
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- Therma Luzon, Inc, Philippines
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- Videocon Industries ltd - India
- Wilmar Investment Holdings
- Aboitiz Power Corporation - Philippines
- Orica Australia Pty. Ltd.
- Kideco Jaya Agung - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Latin American Coal - Colombia
- White Energy Company Limited
- Power Finance Corporation Ltd., India
- Kohat Cement Company Ltd. - Pakistan
- Minerals Council of Australia
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Mercator Lines Limited - India
- Eastern Coal Council - USA
- San Jose City I Power Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Barasentosa Lestari - Indonesia
- SMG Consultants - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- CIMB Investment Bank - Malaysia
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- Jindal Steel & Power Ltd - India
- McConnell Dowell - Australia
- Ministry of Mines - Canada
- Jaiprakash Power Ventures ltd
- Bangladesh Power Developement Board
- Directorate Of Revenue Intelligence - India
- Parry Sugars Refinery, India
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Orica Mining Services - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indika Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Star Paper Mills Limited - India
- Kumho Petrochemical, South Korea
- GN Power Mariveles Coal Plant, Philippines
- Bhatia International Limited - India
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Coalindo Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Madhucon Powers Ltd - India
- Grasim Industreis Ltd - India
- South Luzon Thermal Energy Corporation
- The University of Queensland
- Bharathi Cement Corporation - India
- Electricity Generating Authority of Thailand
- Pendopo Energi Batubara - Indonesia
- India Bulls Power Limited - India
- PNOC Exploration Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Chamber of Mines of South Africa
- Goldman Sachs - Singapore
- Sree Jayajothi Cements Limited - India
- Carbofer General Trading SA - India
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- Vizag Seaport Private Limited - India
- Independent Power Producers Association of India
- European Bulk Services B.V. - Netherlands
- Tamil Nadu electricity Board
- Coastal Gujarat Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Semirara Mining Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- VISA Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Malabar Cements Ltd - India
- Antam Resourcindo - Indonesia
- Kepco SPC Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- Ambuja Cements Ltd - India
- The State Trading Corporation of India Ltd
- Makarim & Taira - Indonesia
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- Uttam Galva Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Energy Link Ltd, New Zealand
- Chettinad Cement Corporation Ltd - India
- Simpson Spence & Young - Indonesia
- Sakthi Sugars Limited - India
- Toyota Tsusho Corporation, Japan
- Global Business Power Corporation, Philippines
- Agrawal Coal Company - India
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Alfred C Toepfer International GmbH - Germany
- Energy Development Corp, Philippines
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Marubeni Corporation - India
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PTC India Limited - India
- Global Green Power PLC Corporation, Philippines
- IEA Clean Coal Centre - UK
- Salva Resources Pvt Ltd - India
- Anglo American - United Kingdom
- Dalmia Cement Bharat India
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Ministry of Finance - Indonesia
- The Treasury - Australian Government
- Central Electricity Authority - India
- Sojitz Corporation - Japan
- SN Aboitiz Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Petron Corporation, Philippines
- Tata Chemicals Ltd - India
- Attock Cement Pakistan Limited
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- Bhoruka Overseas - Indonesia
- SMC Global Power, Philippines
- Planning Commission, India
- Australian Commodity Traders Exchange
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