INDONESIA plans to curb coal exports and is considering a tax on shipments of the mineral, government officials said yesterday, pushing shares in the country's leading coal miners down by more than 13 per cent.!
The world's top thermal coal exporter has introduced a series of regulations aimed at squeezing extra state revenue from the mining industry, including limiting foreign ownership and a 20 percent tax on exports of unprocessed minerals.!
But the government has so far steered clear of coal exports, worth US$27 billion last year, or 13 per cent of the country's total.!
Any coal export curb is not likely to boost prices in the short-term for a well supplied market, but could push up costs for the fuel in the long run as it would force Indonesia's top coal buyers India and China to seek alternatives.
"Indonesia is the biggest supplier of seaborne thermal coal, and if everyone has to pay 20 per cent more to get Indonesian tonnes, it will have a real impact for sure," said Lachlan Shaw, commodities analyst at Commonwealth Bank of Australia in Melbourne.!
Energy and Minerals Minister Jero Wacik said on Monday the country needed to conserve coal for domestic use, in a G20 economy seeing strong growth and surging demand for power generation.!
"Indonesia's need for coal will increase strongly, so exports will need to be controlled," Wacik told the Coaltrans conference in Bali. !
He gave no details on the scope or timeframe of any curbs. !
The comments drove down shares in the country's top coal miners Bumi Resources and Adaro Energy by over 13 per cent, versus a 4.3 pe rcent drop in the broader Jakarta index.!
Indonesia's coal demand is seen growing 10 per cent next year to 63.2 million tonnes and then to about 68 million tonnes by 2014, state utility PLN said yesterday.
It forecasts consumption will surge to 125.7 million tonnes by 2022.!
The former OPEC member is already reducing its liquefied natural gas exports because of higher domestic power demand.!
Thamrin Sihite, a director general in the energy and minerals ministry, said the country is still considering a tax on coal exports, while another official at the ministry said it could impose a quota on production and higher royalties. "Royalties at the moment are too low," Edi Prasodjo, coal mining chief at the ministry, told Reuters on the sidelines of the conference.
"We are still discussing the figures." !
Indonesia already has a domestic supply obligation for coal, but miners have so far been easily able to meet this and ship growing volumes each year to meet regional demand, particularly to India where power generation has surged.!
Tuesday, June 5, 2012
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