Indonesia will lead global growth in thermal coal exports in the next decade with producers Bumi Resources and Adaro Energy becoming two of the top three coal exporting companies worldwide by 2015, an energy consultancy firm said on Tuesday.<\/p>\n
Wood Mackenzie said the country, already the world\u2019s top thermal coal exporter, would make up 39 percent of global increases in coal exports, with Australia coming in a close second, accounting for 36 percent of export growth.<\/p>\n
\u201cIndonesia will be the largest country for growth in thermal coal exports,\u201d said Rudi Vann, an analyst with Wood Mackenzie.<\/p>\n
\u201c[Bumi Resources and Adaro Energy] each own mines at the top of the 10 largest mine expansions for thermal exports in the world,\u201d he said, adding that six of the 10 largest mine expansions globally would be in Indonesia.<\/p>\n
By 2020, Indonesia\u2019s annual production will be above 500 million tonnes, a more than 50 percent increase from last year\u2019s production of 320 million tonnes.<\/p>\n
About a quarter of that - some 130 million tonnes - will be from new greenfield projects, and about 60 percent of which will be exported.<\/p>\n
Indonesia\u2019s coal export growth will be fueled in large part by China and India, where power demand is expected to lift coal imports significantly over the next five years.<\/p>\n
Chinese coal imports could more than double by 2015, trading house Noble Group said, and Wood Mackenzie estimates that China, the world\u2019s largest producer and consumer of coal, will produce an additional 1 billion tonnes through 2015 to meet that demand.<\/p>\n
\u201cIf you put that into context with all the other coal-producing countries, there is far greater growth happening in China than you\u2019re seeing anywhere else in the world,\u201d Vann said.<\/p>\n
But with skyrocketing demand for fuel, Chinese domestic production will lag demand.<\/p>\n
\u201cWe think it\u2019s going to become a structural shift where the local coal industry will not be able to keep up physically with them in China,\u201d Vann said.<\/p>\n
\u201cFor them to physically increase their production, there\u2019s a lot of infrastructure that needs to be built, a lot of coal projects that need to come online,\u201d he added.<\/p>\n
Still, India, which will overtake Japan as the biggest buyer of Indonesian coal this year, will stay ahead of China in the competition for supply from Indonesia, where it gets most of its exports.<\/p>\n
The more than 50 percent surge in Indonesia\u2019s coal production will require significant investment, particularly as newer mines move farther inland, requiring additional infrastructure for export.<\/p>\n
\u201cWith opportunities for thermal seaborne exports, Indonesia needs to continue to attract new investors to sustain production increase ahead of its largest competitor - Australia,\u201d Vann said.<\/p>\n
Despite complaints that Indonesia\u2019s recent overhaul of mining laws has stymied growth in the sector, Wood Mackenzie says Indonesia is relatively well-placed to attract investment.<\/p>\n
\u201cRoyalties have actually reduced as Indonesia tries to attract more investment into the country. And the tax rate has also reduced for producers of coal from previous years to the current system,\u201d Vann said.<\/p>\n
\u201cDespite this uncertainty with the new regulations in place, Indonesia [has] continually increased its production and exports,\u201d he said. \u201c[Companies] always seem to find a way to work around these challenges.\u201d<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/indonesia-to-lead-coal-export-growth-through-2020-1306908408", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }