Indonesia denies reports of possible coal export quotas

Indonesia has denied that it will set a quota for coal exports as it wants to reserve the coal for future use.

The reports had prompted rising interest in the country’s natural resources from energy-hungry China and India.
The reports were baseless and the new mining law likely to be passed by Parliament by June would in fact provide more certainty for mining companies, said Simon Sembiring, director-general of the mineral, coal and geothermal energy department in the Energy and Mining Ministry.

He said the new law would include a plan to set up a mining watchdog that would oversee state reserves of tin, nickel, copper, bauxite, iron and coal.

The announcement comes as companies from China and India are vying for lucrative thermal power mines across Indonesia, which has helped push up the price of coal and shares of companies listed on the Jakarta exchange, including the subsidiary of Thailand’s Banpu Plc.

China No. 2 coal producer, China Coal Energy, said it was exploring investments in Australia and Indonesia while it doubles spending to expand production and feed the world’s largest coal market.

Coal prices FOB (free on board) have nearly doubled over the past year to as high as $125 a tonne.

The hunt for commodities comes as global oil prices continue to soar and some power plant operators look to shift their fuel sources away from petroleum and natural gas.

Bangkok Post