Saturday, January 23, 2010

India hopes Indonesia stays a coal exporter

India is hoping Indonesia will not stop exporting coal as its National Energy Board (DEN) reportedly intends to recoomend. According to Antara news agency, Indian Ambassador to Indonesia, Biren Nanda, advised that India's need for coal is expected to rise to 50 Mt/y in the future.

"I believe Indonesia has many coal reserves so that its coal exports to India and other countries need not disturb its coal mining industry's ability to meet domestic needs," he said.

During a hearing with Indonesia's House of Reoresentatives (DPR) Commission VII on 20 Jan, DEN member, Rinaldi Dalimi said the board was formulating a recommendation to the government to gradually stop the export of coal. He said coal should be saved as an energy reserve to meet future needs.

Rinaldi argued that keeping coal as a future energy source would give maximum benefit to Indonesia since the product`s price was expected to rise in the years ahead. In addition, he said, Indonesia's present coal production of 250 Mt/y would only reach its break-even point in the next 20 to 30 years.

However, the chairman of the Indonesian Coal Mining Association (APBI), Bob Kamandau, said an immediate halt in coal exports would have a negative impact on state revenue and the people's economy. Coal exports contribute Rp 27 trillion per year to the state coffers. Stopping coal exports can cause financial and material losses, increased unemployment and create the risk of investors leaving Indonesia," he said.

He added Indonesia currently produces more than 250 Mt/y of coal while domestic consumption only stands at 60-70 Mt/y. "If the country needs 250 Mt/y of coal, we will be glad to give priority to the national need," he confirmed.

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