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Saturday, 31 October 09
PRODUCERS BENEFIT FROM COAL'S TIGHT SUPPLY AND STRONG DEMAND
 The Jakarta Post reported that, The outlook for Indonesian coal producers appears promising with strong volume growth coming from both the domestic and export markets.
Despite the delayed completion of the 10,000 megawatts (MW) coal-fired steam power plant (PLTU) program, we expect to see additional electricity capacity starting in the fourth quarter of 2009. PLTU Labuan (2x300 MW) was scheduled to operate its first unit in September 2009 and the second unit by December 2009.
PLTU Rembang (2x315 MW) and Indramayu (2x330 MW) should start to operate by January 2010. As nine out of 10 projects in Java-Bali are now in their construction stages, there should be a total add-on capacity of 6,830 MW by the end of 2010. Six PLTU projects (total capacity162 MW) outside the Java-Bali region have already started the construction stage in the fourth quarter of this year with an additional 5 to follow suit.
The Government of Indonesia has finally approved the coal volume required for the domestic market obligation (DMO) at 75 million tons per year starting from 2010, 10.3 percent higher year-on-year from 68 million tons of domestic consumption estimated for 2009.
The volume set for the DMO would amount to 30 percent of the 2010 total estimate for coal production at 250 million tons or up 8.7 percent year-on-year from the 2009 estimate of 230 million tons (chart 1). PLN itself has signed 20-year coal supply contracts, effective once the PLTUs are operational, amounting to 30m tons per year of low-rank coal.
We foresee that the implementation of the DMO has limited the flexibility for coal producers to aggressively penetrate the export market. On top of that, the government has recently revealed its intention to apply a restriction on export quotas at 150 million tons per year starting from 2010.
The regulations would also require each coal producer to allocate 25 percent of their total coal production for the domestic market, or to face penalties in the form of restrictions on their exports.
We see, however, that this last regulation might not be necessary due to the anticipated increase in the volume of coal production going forward, exceeding the domestic demand requirements.
On a more positive note, the government seems willing to accommodate Indonesian coal producers' wishes for minor interventions in regulating the sales price for coal under the DMO provisions. The sales price will be with reference to the international market price to avoid high spreads between export and domestic pricing.
Based on the Newcastle Index, the year-to-date coal price has averaged US$70.7 per ton. Despite a downward trend since the fourth quarter of 2008, coal prices have been relatively steady throughout 2009.
We believe that the price of coal has found its new equilibrium at current levels, supported by stronger demand for higher energy needs mostly in the South East Asian region. Hence, we now expect the coal price to average US$75/t in 2010.
Government also plans to cut the royalty tax rate (DPHB) on low calorific value coal. The proposed DPHB rate is 9 percent for coal with CV<5,000kcal/kg (vis-*-vis 13.5 percent previously) and 7.5 percent for CV<4,500kcal/kg.
We see that upon implementation, lower royalty rates will mean incentives towards growth expectations in the sector.
Stronger domestic demand starting from 2010 paired with recovery of global demand will provide higher volume support for demand for both thermal and coking coal. In our view India will provide the highest growth in thermal coal demand, boosting imports by about 18% to 40m tons beginning this year, in line with the government's plan to double coal-fired electricity generation capacity by 2017.
Indonesia has also made preparations to start the 10,000 MW program phase II which is scheduled to start in 2012 and to operate by 2014.
We estimate coal-fired power plants will take around 48 percent from the total portion of 9,963 MW. Furthermore, coal supply may not grow at the same pace as demand due to export restrictions set on major coal exporters, such as Vietnam and China to secure their domestic needs.
Supported by the fact that the China government has decided to reduce its export quota by 50 percent from 40 million tons to 20 million tons.
As one of the world's major coal exporters, Indonesia will certainly have the upper hand in the tightening supply of coal.
Source:The Jakarta Post
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Sunday, 01 November 09
MINES REGULATION AMENDMENT BILL TO BE TABLED IN PARLIAMENT
Thaindia News reported that, A bill seeking to amend the Mines and Minerals Development Regulation Act, 1957, will be introduced in the winter sessi ...
Sunday, 01 November 09
THE COAL MOVEMENT TO INDIA FROM SOUTH AFRICA AND INDONESIA WOULD BE CONTINUE INCREASE - VISTAAR SINGAPORE
COALspot.com (Singapore): The BDI continued to be firm with an increase of 60 points and closed at 3,103 points.
The cape index also was firm an ...
Sunday, 01 November 09
INDONESIA ADARO Q3 NET PROFIT JUMPS ON COAL DEMAND
* Q3 net profit up 131.6 percent to 1.27 trillion rupiah
* Q3 revenue up 56.8 percent to 7.12 trillion rupiah
Reuters reported that, Indonesia' ...
Sunday, 01 November 09
PT INDIKA MAY BUY STAKES IN BHPB INDONESIA OPERATIONS
Dow Jones reported that Indonesian coal producer PT Indika Energy may buy stakes in BHP Billiton Limited's Indonesian coal operations and in local ...
Sunday, 01 November 09
ADAVALE RESOURCES MAKES COAL ACQUISITIONS IN INDONESIA
Adavale Resources Limited has entered into an agreement to acquire the rights to two thermal coal projects Tapan and Jambi in Sumatra Indonesia, hel ...
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- Banpu Public Company Limited - Thailand
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- Mintek Dendrill Indonesia
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- Bangladesh Power Developement Board
- Coalindo Energy - Indonesia
- Kumho Petrochemical, South Korea
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- London Commodity Brokers - England
- Bahari Cakrawala Sebuku - Indonesia
- Energy Development Corp, Philippines
- New Zealand Coal & Carbon
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- Thai Mozambique Logistica
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- San Jose City I Power Corp, Philippines
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- Planning Commission, India
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- India Bulls Power Limited - India
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Directorate Of Revenue Intelligence - India
- Australian Coal Association
- Salva Resources Pvt Ltd - India
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Georgia Ports Authority, United States
- The State Trading Corporation of India Ltd
- GVK Power & Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- Electricity Authority, New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Independent Power Producers Association of India
- Minerals Council of Australia
- Rio Tinto Coal - Australia
- Kapuas Tunggal Persada - Indonesia
- European Bulk Services B.V. - Netherlands
- International Coal Ventures Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- Sree Jayajothi Cements Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Petron Corporation, Philippines
- Antam Resourcindo - Indonesia
- Globalindo Alam Lestari - Indonesia
- Romanian Commodities Exchange
- Parliament of New Zealand
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- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
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- Manunggal Multi Energi - Indonesia
- Goldman Sachs - Singapore
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- Latin American Coal - Colombia
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- Coastal Gujarat Power Limited - India
- Vedanta Resources Plc - India
- Standard Chartered Bank - UAE
- Electricity Generating Authority of Thailand
- Ind-Barath Power Infra Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Price Waterhouse Coopers - Russia
- CIMB Investment Bank - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- Riau Bara Harum - Indonesia
- Alfred C Toepfer International GmbH - Germany
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- Medco Energi Mining Internasional
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- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Makarim & Taira - Indonesia
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Bulk Trading Sa - Switzerland
- IEA Clean Coal Centre - UK
- Siam City Cement PLC, Thailand
- Ministry of Transport, Egypt
- Ambuja Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Interocean Group of Companies - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sakthi Sugars Limited - India
- Meenaskhi Energy Private Limited - India
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Merrill Lynch Commodities Europe
- Mjunction Services Limited - India
- SN Aboitiz Power Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Savvy Resources Ltd - HongKong
- Ministry of Finance - Indonesia
- Indonesian Coal Mining Association
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Chamber of Mines of South Africa
- Central Java Power - Indonesia
- GMR Energy Limited - India
- Iligan Light & Power Inc, Philippines
- McConnell Dowell - Australia
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thiess Contractors Indonesia
- Dalmia Cement Bharat India
- Sarangani Energy Corporation, Philippines
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- Ministry of Mines - Canada
- Orica Mining Services - Indonesia
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
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- Power Finance Corporation Ltd., India
- PNOC Exploration Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- Intertek Mineral Services - Indonesia
- Xindia Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Kaltim Prima Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Gujarat Electricity Regulatory Commission - India
- Deloitte Consulting - India
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- Sojitz Corporation - Japan
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