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Tuesday, 19 January 10
COAL FOR DOMESTIC USERS
 While the government is already almost a year behind schedule in issuing regulations to implement the new mining law, mineral producers have been worried about the domestic market obligation (DMO) that the Energy and Mining Resources Ministry imposed through a ruling late last month.
Their concern is not so much about the requirement to allocate a portion of their output to domestic users, but the lack of clarity regarding how the volume of domestic needs for each mineral is set, how the obligation will be distributed among the producers and how the prices will be determined.
Mineral producers (other than oil and natural gas) are fully aware that they should fulfill domestic needs. That requirement is also by and large stipulated in their mining contracts. However, the DMO will create new uncertainty if this obligation is not based on clear-cut regulations.
Unfortunately, the Dec. 31, 2009 decree by the energy and mineral resources minister is mostly about repressive measures for companies failing to meet their DMO. It stipulates that producers who fail to realize their DMO are liable to a 50 percent cut of their output for the following year.
What is encouraging to note is that a similar penalty is also imposed on domestic users failing to take up their annual quota — their annual quota will also be cut by 50 percent. This enforcement is important because the volume of the DMO is based on the domestic market demand, which in turn is based on the annual needs of domestic industrial users each year.
The most affected by the DMO policy are certainly coal producers, who have made Indonesia the world’s largest seaborne exporter of thermal coal with an estimated output of 230 million tons last year, of which only about 50 million tons was used locally. However, the domestic demand for coal is estimated to almost double this year with the coming on stream of several power plants run by state electricity company PT PLN, all fired by coal. They are part of the government’s crash program to build 10,000 megawatts in additional capacity at PLN’s plants.
The government has strived to achieve the right balance between maximizing export revenues from coal and also securing supplies for domestic users. The challenge, though, is how to make producers accept domestic prices as fair compared what they get from exports.
Put another way, there should be an Indonesian coal reference price index that is acceptable to both producers and users, taking into account such factors as the coal’s calorific value, moisture content, etc. Such a reference price index is crucial because, unlike other minerals that have commodity exchanges of their own for price formation, coal doesn’t have any exchange of its own.
In the past, the domestic purchasing price of different grades of coal was often considered arbitrary, which acted as a disincentive for some producers to produce and sell higher-quality coal to PLN, the largest single domestic user.
Commercially, as long as the prices are right, producers will happily sell their output to the domestic market as this will cut the delivery time and freight costs.
The problem, though, is that the latest ministerial decree does not touch at all on a pricing mechanism for the implementation of the domestic market obligation, and this is creating a sense of uncertainty among producers.
Obviously the government needs to address this pricing issue immediately through another clear-cut regulation so as not to adversely affect new investment in the mining sector.
Source: Editorial, The Jakarta Post
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Sunday, 17 January 10
THE FUTURES FOR THREE YEARS (2010 - 2012) FIRMED UP - VISTAAR SINGAPORE
COALspot.com (Singapore): The freight market was a bit mixed with BDI up by about 159 points and closed at 3,299 points.
BDI
The cape index cont ...
Sunday, 17 January 10
NTPC TO DOUBLE CAPACITY BY 2017
NTPC, which will launch its follow-on public offer on February 3, plans to more than double its generating capacity to over 70,000 mega watts by 201 ...
Saturday, 16 January 10
HANDY CONTINUED FIRM CONDITIONS FOR MARKET IN THE ATLANTIC
HANDY
Continued firm conditions for the Handymax / Smax market in the Atlantic with the BSI having a continued upwards momentum. US$ 45,000 ac ...
Friday, 15 January 10
INDONESIA COAL - HEAVY RAINS HAVE LITTLE IMPACT ON COAL OUTPUT
Coal shipments from Indonesia's main coal-producing area are unlikely to be hit by heavy rains during January-February as many miners are prepared ...
Friday, 15 January 10
GOVT BRINGS IN DOMESTIC COAL MARKET OBLIGATION
The Energy and Mineral Resources Ministry has issued a ministerial decree requiring producers of coal and other minerals to allocate a proportion ...
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- Cement Manufacturers Association - India
- Kepco SPC Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Parliament of New Zealand
- Sindya Power Generating Company Private Ltd
- Deloitte Consulting - India
- Agrawal Coal Company - India
- Indian Oil Corporation Limited
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- New Zealand Coal & Carbon
- Riau Bara Harum - Indonesia
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Toyota Tsusho Corporation, Japan
- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Sical Logistics Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Mintek Dendrill Indonesia
- The University of Queensland
- Globalindo Alam Lestari - Indonesia
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- CIMB Investment Bank - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Mercuria Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- Therma Luzon, Inc, Philippines
- Power Finance Corporation Ltd., India
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Leighton Contractors Pty Ltd - Australia
- IHS Mccloskey Coal Group - USA
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Salva Resources Pvt Ltd - India
- Attock Cement Pakistan Limited
- Xindia Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Dalmia Cement Bharat India
- South Luzon Thermal Energy Corporation
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhatia International Limited - India
- Eastern Coal Council - USA
- Aboitiz Power Corporation - Philippines
- Madhucon Powers Ltd - India
- Price Waterhouse Coopers - Russia
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Trasteel International SA, Italy
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Heidelberg Cement - Germany
- Ceylon Electricity Board - Sri Lanka
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Borneo Indobara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Medco Energi Mining Internasional
- Kalimantan Lumbung Energi - Indonesia
- Bhushan Steel Limited - India
- Ind-Barath Power Infra Limited - India
- Metalloyd Limited - United Kingdom
- ASAPP Information Group - India
- GN Power Mariveles Coal Plant, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- Planning Commission, India
- Larsen & Toubro Limited - India
- SMG Consultants - Indonesia
- International Coal Ventures Pvt Ltd - India
- MS Steel International - UAE
- Port Waratah Coal Services - Australia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- Kartika Selabumi Mining - Indonesia
- Wilmar Investment Holdings
- Kideco Jaya Agung - Indonesia
- Barasentosa Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Singapore Mercantile Exchange
- White Energy Company Limited
- Global Coal Blending Company Limited - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IEA Clean Coal Centre - UK
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- Thiess Contractors Indonesia
- PowerSource Philippines DevCo
- Global Business Power Corporation, Philippines
- Ministry of Transport, Egypt
- Eastern Energy - Thailand
- Savvy Resources Ltd - HongKong
- Gujarat Mineral Development Corp Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- Kumho Petrochemical, South Korea
- The State Trading Corporation of India Ltd
- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Rashtriya Ispat Nigam Limited - India
- San Jose City I Power Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- Siam City Cement - Thailand
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Gujarat Sidhee Cement - India
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Minerals Council of Australia
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Siam City Cement PLC, Thailand
- GVK Power & Infra Limited - India
- Tamil Nadu electricity Board
- Indonesian Coal Mining Association
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Baiduri Energy - Indonesia
- Sakthi Sugars Limited - India
- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Sojitz Corporation - Japan
- Electricity Generating Authority of Thailand
- SN Aboitiz Power Inc, Philippines
- Latin American Coal - Colombia
- TeaM Sual Corporation - Philippines
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- Carbofer General Trading SA - India
- PetroVietnam Power Coal Import and Supply Company
- Edison Trading Spa - Italy
- SMC Global Power, Philippines
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- London Commodity Brokers - England
- Holcim Trading Pte Ltd - Singapore
- Meralco Power Generation, Philippines
- Ministry of Finance - Indonesia
- Videocon Industries ltd - India
- Indika Energy - Indonesia
- The Treasury - Australian Government
- OPG Power Generation Pvt Ltd - India
- Vedanta Resources Plc - India
- Timah Investasi Mineral - Indoneisa
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Australian Coal Association
- GMR Energy Limited - India
- Sree Jayajothi Cements Limited - India
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Central Electricity Authority - India
- Bharathi Cement Corporation - India
- Chettinad Cement Corporation Ltd - India
- Coastal Gujarat Power Limited - India
- Wood Mackenzie - Singapore
- Marubeni Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Miang Besar Coal Terminal - Indonesia
- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Petron Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Interocean Group of Companies - India
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- Bulk Trading Sa - Switzerland
- Aditya Birla Group - India
- Romanian Commodities Exchange
- Africa Commodities Group - South Africa
- Samtan Co., Ltd - South Korea
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