Indonesia, currently among the world’s largest coal exporters, produced nearly 100 million tons coal, mostly used for the operation of power plants, in the first quarter of this year, an official has said.
The Energy and Mineral Resources Ministry’s coal director, Edi Prasodjo, said in Jakarta on Tuesday that coal production totaled 99 million tons in the first three months of this year in line with targets.
Speaking on the sidelines of the seventh Australian Mining Exhibition and Conference (Ozmine 2013) in Jakarta, Edi said that 80 million tons, or around 80 percent of the total 99 million tons of coal production during the three-month period, were exported to major importing countries, such as China and India.
Indonesia, he added, aimed to produce a total of 391 million tons of coal, mostly thermal coal, by the end of this year up by 1.2 percent from the output in 2012 of 386 million tons.
Of the total production estimated this year, around 74.3 million tons, or 19 percent, would be allocated for domestic buyers as part of the country’s domestic market obligation (DMO) policy, while the rest would be exported, he said. Last year, Indonesia exported 304 million tons of coal or 78 percent of the total production while the remaining 22 percent, or 82 million tons, was sold domestically, according to ministry data.
The ministry’s data also shows that the Indonesian coal price reference (HBA) reached US$88.56 per ton in April this year or slightly lower than the price in March of $90 per ton. In January, the HBA stood at $87.55 per ton before it went slightly higher to $88.35 per ton in February.
The government had previously expected the price to reach over $100 per ton this year following potential economic recovery.
The average HBA last year only reached $95.5 per ton, far below the average of $118.4 per ton throughout 2011, much to the dismay of the country’s mining companies.
As previously reported by The Jakarta Post, the country’s main utility firm, state-owned Perusahaan Listrik Negara (PLN), expected Indonesia to begin importing coal as of 2020 to meet domestic power needs as the country exports almost 80 percent of its annual coal output.
In 2014, according to PLN’s data, the country will need 67.8 million tons of coal to produce electricity, which might increase to 101.4 million tons in 2017 and 125.7 million tons in 2020.
The ministry’s head of coal operation, production and marketing, Gultom Guska, said separately the government acknowledged the percentage of domestic coal demand remained low compared to exports.
“Coal is still treated as a commodity for increasing state revenues,” he said.
Indonesia’s coal and minerals mining sector in 2012 contributed Rp 123.6 trillion (US$12.7 billion) of non-tax revenue, less than half that generated by the oil and gas industry, which contributed Rp 301 trillion of non-tax revenue.
Indonesia’s coal reserves are estimated at 20 billion tons, according to data from the country’s mining associations, which is smaller than other countries such as China, which has coal reserves of 115 billion tons, and Australia, which possesses around 76 billion tons of reserves.
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