Serabdi Sakti
Jakarta, August 2016
Energy Industry in Indonesia
&
World’s Renewable Energy
by :
Sando Sasako
Serabdi Sakti
Jakarta, August 2016
Energy Industry in Indonesia
&
World’s Renewable Energy
by :
Sando Sasako
Jakarta, 20 July 2016
Last update: 2016-08-25 03:03:22
This book is a part of an on-going research on energy business in Indonesia, including a near
exhaustive profile of renewable energy in the world and its increasing trends. This part will be
updated in a timely manner.
This book is available on a print-on-demand basis. The flash version is for demo purpose only and
available only to be served in Greater Jakarta, Indonesia.
You may reach the publisher for demo request, inquiries, and purchase order from this number:
+62 851 0518 7118 or +62 21 4027 8375.
Energy Industry in Indonesia & World's Renewable Energy – iii
Foreword in Coal Mining Business in Indonesia
Coal deposits all around the world may have been declining. It’s on the surface, but not in deep
underground. Extracting coal physically beneath the earth, majorly under the deep seabed, is not an
easy task to fulfill and complete. Some advantages may have come for digging coal out of the
underwater. Coal washing doesnot need special water resources and treatment, but from the sea or
ocean. Every thing must have a plus and a minus. It depends on what perspectives you’ve taken all
along.
The choice then lend it to the tasks of extracting the coal ores, that is the molecular carbons in gas,
namely CO, CH4, and H2. Syngas, they used to call it as the term. But not the CO2. CO2 is mostly
considered as the public enemy number one to be captured and imprisoned in a dungeon, deep
underground, for good. Various CO2 absorbents have been sought and developed, along with the
technologies to filter out the impurities embedded with coal, namely SOx and NOx.
Many have mixed up inappropriately the understandingness between coal gasification and coal
combustion. Even FoE. Those two coal treatments are different things. The first is heating the coal,
while the second is burning the coal. Both process involves massive thermal chain reactions. The
problems with UCG is that how can you guarantee that it is the coal seam and the intended ones that
has been gasified.
How about the walls, the roofs, the floors, and the layers buffering the coal seams? How about if the
words of collapse and/or cracks applied to those layers? Won’t they initiate a flow of the
unexpected such as a mud flow for example as in Porong, Sidoarjo, East Java, Indonesia, that hasn’t
stopped since it began to erupt on 29 May 2006.
Even worse is how the earth is burning the coal seams underground. Burning Mountain of Mount
Wingen in New South Wales has been burning for 6000 years, Brennender Berg in German since
1688, Smoking Hill in NW Canada since its discovery in 1826, Emalahleni in South Africa since
1953, and Centralia in Pennsylvania since 27 May 1962.
The list doesnot include the burning of methane in Derweze, Turkmenistan since 1971, known as
door to hell; Baba Gurgur oilfield nearby Kirkuk, Irak for 2500 years, known as eternal fire; Yanar
Dag near Baku, Azerbaijan since 1950s, known as land of fire.
The unanswered questions to protect the environment underground and the surrounding area has left
many UCG projects to be terminated, cancelled, withdrawn, neglected, abandoned, forbidden. They
are all due to lack of environmental protection technologies, and most of all understandingness how
to deal and cope it before hand.
Therefore, UCG is not an option to exploit coal deposits underground. At least for now, and some
decades to come.
Jakarta, 31 August 2016
Sando Sasako
Email: sandosako @ yahoo.com
Mobile: +62 812 8056 516
Energy Industry in Indonesia & World's Renewable Energy – v
Foreword in PT Borneo Lumbung Energi & Metal Tbk: On the Road to Recovery
In less than 2 months before Linc Energy Ltd filed for voluntary administration on 30 March 2016,
Linc Energy had signed an MOU with at least 2 Indonesian companies regarding the UCG projects
in Indonesia, that is 18 February 2016. However, on 23 May 2016, Linc Energy just had confirmed
its status as a liquidating company, but not its US subsidiaries as they had filed for relief and seek
bankruptcy protection (Chapter 11) on 29 May 2016.
The MOUs were the one of many heydays that UCG projects have been accepted worldwide as an
alternative to mine the primary energy coal in terms of syngas. Scotland, Australia, Vancouver, and
Nova Scotia were the few names that had been offering and approving coal companies to try and
implement the UCG technologies.
As coal companies can never be aware of what beneath the earth surface, they failed to convince
that they already have the required technologies and resources to protect the environment. They are
doomed to fail before it’s begun.
As a consequences, lenders and creditors participating as investors in the proposed UCG projects
surely stop funding and began to demand a payback. Even worst, they wanted to liquidate their
assets invested in the troubled coal companies.
Some companies may weather the storm and sail unscathedly. Some others may have to sink and
scuttle their ships to the bottom of ocean floor. Nevertheless, what may have saved the ships from
sinking is the captain and skipper of the ship. Should the captain know exactly the weights and
worth of the ship, the cargoes, and the crews, they shall bargain to salvage what’s worth saving.
Indeed, in the beginning, it hurts. A lot. To many parties. Corporate retrenchment, layoffs, shrinking
assets are some desperate measures to be taken in desperate times. These inevitable corporate
actions are unload some burdens in preserving cashflows and contain cash drains. Some assets are
indeed liabilities. Especially when the assets are failing to perform and generate revenues that
profitable enough to cover the incurred and embedded expenses.
Jakarta, 31 August 2016
Sando Sasako
Email: sandosako @ yahoo.com
Mobile: +62 812 8056 516
Energy Industry in Indonesia & World's Renewable Energy – vii
Contents
Foreword in Coal Mining Business in Indonesia ............................................................................ iii
Foreword in PT Borneo Lumbung Energi & Metal Tbk: On the Road to Recovery .......................... v
Contents ....................................................................................................................................... vii List of Tables .............................................................................................................................. xiii
List of Figures ............................................................................................................................... xv
Why do we need renewables? .......................................................................................................... 1
Lesser Lead Times ....................................................................................................................... 2 Higher Capital Recovery.............................................................................................................. 3
Increased Trends in Renewable Power Generation ....................................................................... 5 Shifting costs to use renewables ................................................................................................... 9
Share of Renewables Consumption ................................................................................................ 10
Total Energy Consumption ........................................................................................................ 12 Renewable Energy Applications ................................................................................................ 13
Renewables vs Non-Renewables ................................................................................................ 14 Why Liquid Fuels Matter ........................................................................................................... 16
Energy Industry Defined ............................................................................................................ 18 Forms of Energy ........................................................................................................................ 19
Investments in Renewables ........................................................................................................ 21 Capacity in Renewable Energy .................................................................................................. 23
Renewable Electricity ................................................................................................................ 24 Capacity in Renewable Electricity ............................................................................................. 28
Energy Technology Costs .............................................................................................................. 31
Supports to Renewable Energy Industry ........................................................................................ 35
Input and Output in Energy Industry .............................................................................................. 38
Global Trends in Energy Industry .................................................................................................. 44
The Saudi Factor........................................................................................................................ 44 The Revolutionary US Shale ...................................................................................................... 46
Primary Energy Consumption in the World ............................................................................... 48
Global Coal Trends........................................................................................................................ 51 Coal Price Dynamics in the World ............................................................................................. 52
Fracking Coalmines ................................................................................................................... 55 Coal Gasification ....................................................................................................................... 56
Underground Coal Gasification .............................................................................................. 59 Kincardine UCG, Scotland, UK ............................................................................................. 60
Raven and Hat Creek Coalfield, BC, Canada ......................................................................... 63
Global Warming or Global Heating ........................................................................................... 65 Greenhouse Gas ..................................................................................................................... 67
CO2 as One of GHGs ............................................................................................................ 69 Oxygen Carriers ..................................................................................................................... 70
CO2 Recovery ....................................................................................................................... 72
viii – Energy Industry in Indonesia & World's Renewable Energy
Underwater Coalmines............................................................................................................... 73
Hashima Coal Mine, Japan ..................................................................................................... 74 Okinoyama Coal Mine, Japan ................................................................................................ 75
Beizao Coal Mine, China ....................................................................................................... 75 Bomlo Coal Mine, Norway .................................................................................................... 77
Cape Breton Coal Mines, Nova Scotia, Canada ...................................................................... 79 Solway Coal Mines, Cumbria, UK ......................................................................................... 83
North Sea Coal Mines, NE England ....................................................................................... 84 Forth Coal Mines, Scotland, UK ............................................................................................ 85
The End of Deep Coal Mines in the UK ................................................................................. 86
Energy Business in Indonesia in a brief ......................................................................................... 89
Oil ............................................................................................................................................. 90 Oil Infrastructure ................................................................................................................... 91
Oil Production ....................................................................................................................... 92
Gas ............................................................................................................................................ 93 Chemical Characteristics of Gas............................................................................................. 96
Liquefied Natural Gas ............................................................................................................ 96 Liquefied Petroleum Gas...................................................................................................... 101
Coal-Bed Methane ................................................................................................................... 105
The Milestone of CBM Commercialisation .......................................................................... 107 CBM Asia @ Kutai West PSC ............................................................................................. 108
Dart Energy & IGas ............................................................................................................. 110 Dart Energy & NuEnergy ..................................................................................................... 111
Coal ......................................................................................................................................... 119
History of Coal Business in Indonesia .................................................................................. 124 Regulatory Frameworks ....................................................................................................... 127
The Dutch Colonialism .................................................................................................... 127 The Mining Law of 1967.................................................................................................. 127
The Production Sharing Contract in Coal Mining of 1975 ................................................ 129 The Coal Contract of Work of 1981 ................................................................................. 129
Forced Localisation .......................................................................................................... 130
Issues on Enviromental and Decentralisation ....................................................................... 132 Ministerial Regulations (Permen ESDM) ......................................................................... 133
Ministerial Decrees (Kepmen ESDM) .............................................................................. 135
Clean and Clear: The Causes ................................................................................................ 138 The Non-CNC Status ....................................................................................................... 140
Unclear DMO System ...................................................................................................... 143 Forestry Land Use Permit................................................................................................. 147
Korsup Minerba ............................................................................................................... 148
CCoW Companies: The First Generations ............................................................................ 151 BHP Kendilo Coal Indonesia ........................................................................................... 156
BHP Businesses in Indonesia ........................................................................................... 158 Rio Tinto.......................................................................................................................... 158
Tata Power ....................................................................................................................... 159
Energy Industry in Indonesia & World's Renewable Energy – ix
Arutmin Indonesia ........................................................................................................... 161
Kaltim Prima Coal ........................................................................................................... 161 Bumi Resources ............................................................................................................... 163
The IndoCoal Deals ..................................................................................................... 163
Borneo Lumbung Energi & Metal .................................................................................... 166 Has Samin Tan lost his bets in Bumi plc and BORN? ................................................... 166
The Company Named Borneo Lumbung Energi ........................................................... 167 The Road to Highly Indebted BORN ............................................................................ 169
The Awkward and Ugliness in 2011 ............................................................................. 172 The Teasing Dreams and Illusion of Interest in Bumi plc ............................................. 176
The $1b Debt Traps for Lending Stanchart and Borrowing BORN ............................... 178 The End of Bumi plc .................................................................................................... 180
Tony Blair .................................................................................................................... 181 REDD+ ........................................................................................................................ 182
Heart of Borneo ........................................................................................................... 183 Samin Tan .................................................................................................................... 184
Recapital Advisors ....................................................................................................... 185 Borneo Lumbung Energi and Energi Megah Persada .................................................... 186
Borneo Lumbung Energi & Metal: The Brief Profile ........................................................ 188
Shareholders ................................................................................................................ 188 Management ................................................................................................................ 189
Related Parties and Financial Transactions ................................................................... 190 Third Parties & Transaction Types ............................................................................... 192
IPO Proceeds ............................................................................................................... 194 Financials ..................................................................................................................... 195
Surviving on Debt Burdens, Theoretically .................................................................... 195 The Walk-Through ....................................................................................................... 198
The Road So Far .......................................................................................................... 199 Troubles with the Crown Jewel Holding the Bargain Chip ........................................... 200
Asmin Koalindo Tuhup .................................................................................................... 203
AKT in Brief, Legally .................................................................................................. 205 Concession Area .......................................................................................................... 206
Coal Deposits ............................................................................................................... 207 Mining Operations ....................................................................................................... 208
Production .................................................................................................................... 209 Product Specifications .................................................................................................. 210
Coal 101 ...................................................................................................................... 210 Coking Coal Grades ..................................................................................................... 212
Infrastructure................................................................................................................ 212 Transportation .............................................................................................................. 213
Marketing & Sales ....................................................................................................... 215 Customers .................................................................................................................... 215
Management ................................................................................................................ 216 Shareholders ................................................................................................................ 216
Financials ..................................................................................................................... 217
Allied Indo Coal .............................................................................................................. 219
References ................................................................................................................................... 221
x – Energy Industry in Indonesia & World's Renewable Energy
Directory of Coal Mining Companies in Indonesia ...................................................................... 225
Abadi Batubara Cemerlang .................................................................................................. 225 Abadi Coal Cemerlang ......................................................................................................... 225
Aceh Resources and Mineral ................................................................................................ 225 Aceh Resources and Mineral Core ....................................................................................... 225
Adaro Indonesia ................................................................................................................... 225 Adimas Baturaja Cemerlang ................................................................................................ 225
Allied Indo Coal , PT ........................................................................................................... 226 Andhika Mutiara Etam ......................................................................................................... 226
Andhika Mutiara Lestari ...................................................................................................... 226 Andhika Mutiara Sejahtera ................................................................................................... 226
Antang Gunung Meratus ...................................................................................................... 226 Anugerah Jatimulia .............................................................................................................. 227
Anugerah Jatimulya ............................................................................................................. 227 Arutmin Indonesia ............................................................................................................... 227
Asmin Bara Bronang............................................................................................................ 227 Asmin Bara Jaan .................................................................................................................. 227
Asmin Koalindo Tuhup ........................................................................................................ 227 Astaka Dodol ....................................................................................................................... 228
Bahari Cakrawala Sebuku .................................................................................................... 228 Bangun Banua Persada Kalimantan ...................................................................................... 228
Bara Mutiara Prima .............................................................................................................. 228 Bara Pramulya Abadi ........................................................................................................... 229
Bara Sentosa Lestari ............................................................................................................ 229 Bara Utama Unggul ............................................................................................................. 229
Baradinamika Mudasukses ................................................................................................... 229 Baramarta, PD ..................................................................................................................... 229
Baramarta ............................................................................................................................ 229 Baramulti Sukses Sarana ...................................................................................................... 230
Baramulti Suksessartana ...................................................................................................... 230 Baramutiara Prima ............................................................................................................... 230
Barasentosa Lestari .............................................................................................................. 230 Batu Alam Selaras ............................................................................................................... 230
Batubara Duaribu Abadi, PT ................................................................................................ 230 Batubara Selaras Sapta, PT .................................................................................................. 230
Baturona Adimulya .............................................................................................................. 231 Benakat Energi .................................................................................................................... 231
Benakat Energy.................................................................................................................... 231 Bentala Coal Mining ............................................................................................................ 231
Berau Coal ........................................................................................................................... 231 Bharinto Ekatama ................................................................................................................ 231
Bima Duta Batubara Sakti .................................................................................................... 232 Borneo Bhaktibara Utama .................................................................................................... 232
Borneo Indobara .................................................................................................................. 232 Buana Bara Utama ............................................................................................................... 232
Bukit Baiduri Enterprises ..................................................................................................... 232 Bukit Sunur.......................................................................................................................... 233
Bumi Laksana Perkasa ......................................................................................................... 233 Bumi Panen Sukses .............................................................................................................. 233
Bumi Sukse Mandiri ............................................................................................................ 233 Buntok Perdana Coal Mining ............................................................................................... 233
Calicari ................................................................................................................................ 233
Energy Industry in Indonesia & World's Renewable Energy – xi
Coal Duaribu Abadi ............................................................................................................. 233
Coal Selaras Sapta ............................................................................................................... 234 Danau Mas Hitam ................................................................................................................ 234
Daya Lapan ......................................................................................................................... 234 Delma Mining Corporation .................................................................................................. 234
Dhamar Tejokencono ........................................................................................................... 234 Dharma Puspita Mining ....................................................................................................... 234
Dutaputra Tanaratama .......................................................................................................... 235 Ekasatya Yanatama .............................................................................................................. 235
Energi Batubara Sumatera .................................................................................................... 235 Energy Batubara Sumatra .................................................................................................... 235
Fajar Bumi Sakti .................................................................................................................. 235 Firman Ketaun Perkasa ........................................................................................................ 235
Galicari ................................................................................................................................ 235 General Sakti Kreasindo ...................................................................................................... 236
Generalindo Prima Coal ....................................................................................................... 236 Gunung Bayan Pratama ....................................................................................................... 236
Gunung Bayan Pratama Coal ............................................................................................... 236 Hulubalang Inti Bumi .......................................................................................................... 236
Indexim Coalindo ................................................................................................................ 236 Indominco Mandiri .............................................................................................................. 237
Insani Bara Perkasa .............................................................................................................. 237 Interex Sacra Raya ............................................................................................................... 237
Intitirta Prima Sakti .............................................................................................................. 237 Intitirta Primasakti ............................................................................................................... 238
Jorong Barutama Greston ..................................................................................................... 238 Juloi Coal ............................................................................................................................ 238
Kadya Caraka Mulia ............................................................................................................ 238 Kalimantan Energi Lestari ................................................................................................... 238
Kalteng Coal ........................................................................................................................ 239 Kaltim Prima Coal ............................................................................................................... 239
Kartika Selabumi Mining ..................................................................................................... 239 Karunia Poladaya Bumi ....................................................................................................... 239
Karya Bumi Baratama.......................................................................................................... 239 Kendilo Coal Indonesia ........................................................................................................ 240
BHP Kendilo Coal Indonesia ............................................................................................... 240 Kideco Jaya Agung .............................................................................................................. 240
Kitadin ................................................................................................................................. 240 Kodeco Horna Mandiri ........................................................................................................ 240
Kurnia Sarana Lestari .......................................................................................................... 240 Kutai Kertanegara Prima Coal ............................................................................................. 240
Lahai Coal ........................................................................................................................... 241 Lanna Harita Indonesia ........................................................................................................ 241
Lianganggang Cemerlang .................................................................................................... 241 Mahakam Sumber Jaya ........................................................................................................ 241
Mandiri Intiperkasa .............................................................................................................. 241 Mantimin Coal Mining ........................................................................................................ 242
Marunda Graha Mineral ....................................................................................................... 242 Marunda Grahamineral ........................................................................................................ 242
Maruwai Coal ...................................................................................................................... 242 Maruai Coal ......................................................................................................................... 242
Meulaboh Energitama .......................................................................................................... 242
xii – Energy Industry in Indonesia & World's Renewable Energy
Meullaboho Energitama ....................................................................................................... 243
Mitrajaya Timuragung ......................................................................................................... 243 Multi Harapan Utama .......................................................................................................... 243
Multi Tambangjaya Utama ................................................................................................... 243 Nusa Minera Utama ............................................................................................................. 243
Nusantara Termal Coal (D/A Nusantara Thai Coal) ............................................................. 244 Nusantara Thai Coal ............................................................................................................ 244
Pari Coal .............................................................................................................................. 244 Pendopo Energi Coal ........................................................................................................... 244
Pendopo Energy Batubara .................................................................................................... 244 Perkasa Inakakerta ............................................................................................................... 244
Persada Permata Mulya ........................................................................................................ 245 Persada Permata Mulia......................................................................................................... 245
Pesona Khatulistiwa Nusantara ............................................................................................ 245 Pinang Jaya Sarana Bara ...................................................................................................... 245
Pinangjaya Sarana Bara ....................................................................................................... 245 Ramdany Coal Mining ......................................................................................................... 245
Ratah Coal ........................................................................................................................... 245 Restubara Karya Pratama ..................................................................................................... 246
Riau Bara Harum ................................................................................................................. 246 Salamindo Coalindo ............................................................................................................. 246
Salamindo Pahala................................................................................................................. 246 Santan Coal.......................................................................................................................... 246
Santan Batubara ................................................................................................................... 246 Sarwa Sembada Karya Bumi ................................................................................................ 246
Selatan Selabara ................................................................................................................... 247 Selo Argodedali ................................................................................................................... 247
Selo Argokencono Sakti ....................................................................................................... 247 Senamas Energindo Mulya ................................................................................................... 247
Senamas Energindo Mulia ................................................................................................... 247 Sinar Benua Prima ............................................................................................................... 248
Sinarindo Barakarya............................................................................................................. 248 Singlurus Pratama ................................................................................................................ 248
Solok Bara Adipratama ........................................................................................................ 248 Sumber Barito Coal ............................................................................................................. 248
Sumber Kurnia Buana .......................................................................................................... 249 Suprabari Mapanindo Mineral .............................................................................................. 249
Tambang Damai .................................................................................................................. 249 Tanito Harum....................................................................................................................... 249
Tanjung Alam Jaya .............................................................................................................. 250 Tanjung Alam Raya ............................................................................................................. 250
Taraco Mining ..................................................................................................................... 250 Teguh Persada Coal ............................................................................................................. 250
Teguh Reksa Daya ............................................................................................................... 250 Teguh Sinar Abadi ............................................................................................................... 250
Tempayang Cemerlang ........................................................................................................ 251 Timah Batubara Utama ........................................................................................................ 251
Torah Antareja Mining......................................................................................................... 251 Trimarta Coal Perkasa .......................................................................................................... 251
Trimata Buana ..................................................................................................................... 251 Trimata Benua ..................................................................................................................... 251
Trimata Coal Perkasa ........................................................................................................... 252
Energy Industry in Indonesia & World's Renewable Energy – xiii
Trubaindo Coal Mining ........................................................................................................ 252
Wadung Mas Tambang Mulia .............................................................................................. 252 Wadungmas Tambang Mulia ............................................................................................... 252
Wahana Baratama Mining .................................................................................................... 252 Whirakaneo Coalindo .......................................................................................................... 252
Whiratama Bina Perkasa ...................................................................................................... 252 Yamabhumi Palaka .............................................................................................................. 253
List of Tables
Table 1 – World primary energy demand by fuel and scenario (Mtoe) ........................................... 10
Table 2 – World renewables consumption by scenario ................................................................... 11 Table 3 – Share of global final energy consumption by end-use, 2014 ........................................... 13
Table 4 – Distributed renewable energy for productive energy services and economic
development ........................................................................................................... 14
Table 5 – Energy characteristics of energy-intensive industries, 2013 ............................................ 19 Table 6 – Forms of energy ............................................................................................................. 19
Table 7 – Energy units with conversion factors and energy equivalents ......................................... 20 Table 8 – Energy conversion efficiencies ....................................................................................... 21
Table 9 – Global trends in renewable energy new investment by technology, 2004-2014 (US$
bn) .......................................................................................................................... 21
Table 10 – Renewable energy indicator, 2014 ................................................................................ 22 Table 11 – Global trends in renewable energy new investment by stage, 2004-2014 (US$ bn) ....... 23
Table 12 – Global renewable energy capacity and biofuel production, 2014 .................................. 23 Table 13 – Top-5 countries in annual investment / net capacity additions / production, 2014 ......... 24
Table 14 – World electricity generation by source and scenario (TWh).......................................... 25 Table 15 – Power system flexibility options and characteristics ..................................................... 27
Table 16 – Renewable electric power global capacity, top regions/countries, 2014 (GW) .............. 29 Table 17 – Top-5 countries in total capacity or generation as of end-2014 ..................................... 30
Table 18 – Status of renewable technologies: characteristics and costs in power generation
and hot water/heating/cooling ................................................................................. 33
Table 19 – Status of renewable technologies: characteristics and costs: Distributed renewable
energy in developing countries ................................................................................ 34
Table 20 – Status of renewable technologies: characteristics and costs: Transport fuels ................. 35 Table 21 – Relevant comparisons for evaluating competitiveness of renewable energy
technologies by scale and role played ...................................................................... 36 Table 22 – Primary Energy Consumption in the World by Countries, 2005-2015 (mtoe) ............... 48
Table 23 – Primary Energy: Consumption in the World by Countries and by Fuel Type, 2014
(mtoe) ..................................................................................................................... 49
Table 24 – Primary Energy: Consumption in the World by Countries and by Fuel Type, 2015
(mtoe) ..................................................................................................................... 50
Table 25 – BP coal prices, 1987-2015 ($/tonne) ............................................................................. 52 Table 26 – US coal export price, 2010q1-2016q1 ($/short tons) ..................................................... 52
Table 27 – Coal In-Place Resources for Upper Limestone Fm + Limestone Coal Fm,
Kincardine, Nov.2014 ............................................................................................. 61
Table 28 – Coal In-Place Resources for Upper Limestone Fm, Kincardine, Nov.2014 ................... 61 Table 29 – Coal In-Place Resources for Limestone Coal Fm, Kincardine, Nov.2014 ..................... 61
Table 30 – Coal In-Place Resources, Kincardine, Nov.2014 .......................................................... 62 Table 31 – Estimates of trace chemicals abundance in the global atmosphere, 1980. ...................... 69
Table 32 – Overview of existing chemical-looping combustors ..................................................... 72 Table 33 – Some undersea coalmines in Solway Firth, Cumbria, UK ............................................. 83
xiv – Energy Industry in Indonesia & World's Renewable Energy
Table 34 – Oil refineries in Indonesia, 2014 ................................................................................... 91
Table 35 – Crude oil supply and demand in Indonesia, 2000-2014 ................................................. 93 Table 36 – Crude oil refinery production in Indonesia, 2000-2014 ................................................. 93
Table 37 – Natural gas production in Indonesia, 2000-2014 ........................................................... 94 Table 38 – LNG Plants in Indonesia .............................................................................................. 97
Table 39 – Regasification terminals in Indonesia, existing and planned, 2014 ................................ 98 Table 40 – LPG supply and sales in Indonesia, 2000-2014 ........................................................... 101
Table 41 – CBM Resources in Indonesia ..................................................................................... 105 Table 42 – The 20 largest shareholders of Dart Energy Limited, 20100914 .................................. 110
Table 43 – Some subsidiaries of IGas which were held through subsidiaries, 30 June 2015 ......... 111 Table 44 – Coal reserves in Indonesia, 2014 ................................................................................ 120
Table 45 – Coal supply in Indonesia, 2000-2014 .......................................................................... 121 Table 46 – Existing coal terminals in Indonesia ........................................................................... 122
Table 47 – Coal mining companies in Indonesia by permits, March 2015 .................................... 124 Table 48 – CNC status of IUP by announcements, 20110630-20160104 ...................................... 139
Table 49 – Problems of Non-CNC IUPs by category and regions, 20140203 ............................... 140 Table 50 – Clean and Clear IUPs by province, 2014 – April 2016 ................................................ 142
Table 51 – Coal Domestic Market Obligations in Indonesia, 2010-2015 ...................................... 143 Table 52 – Coal Domestic Market Obligations in Indonesia, by CCoW and KP/IUP
companies, 20100419-20150427 (mt) ................................................................... 145 Table 53 – Overlay of IUP, COW, and PKP2B with Forest Area Map and IPPKH....................... 147
Table 54 – IUP within conservation forests in 12 provinces, 2014-2015 ...................................... 147 Table 55 – The First Generation CCoW Companies: The dates, area, and resources/reserves ....... 151
Table 56 – The second generation of CCoW Companies: 17 of 19 ............................................... 151 Table 57 – Coal produced from Kalimantan, 1997-2000 (1000 ton) ............................................. 152
Table 58 – The third generation of CCoW Companies: 106 of 114 .............................................. 153 Table 59 – Coal production from CCoW companies, 2005-2012 (1,000 ton) ............................... 155
Table 60 – Financial profile of 3 direct subsidiaries of Tata Power on coal business in
Indonesia, 2015q1 (₹ crore)................................................................................... 159
Table 61 – Subsidiaries of Tata Power related with coal mining business in Indonesia, 2015q1
(₹ crore) ................................................................................................................ 159
Table 62 – Tata Power companies in Indonesia, 2015 .................................................................. 160 Table 63 – The most vital financial figures of PT Borneo Lumbung Energi & Metal Tbk,
2006-2014q3 ......................................................................................................... 169 Table 64 – BORN’s debts by signing dates and terms, 2005-2010 ............................................... 171
Table 65 – BORN’s loans, 2007q4 -2012q1 ................................................................................. 172 Table 66 – Underwriters at BORN’s IPO ..................................................................................... 173
Table 67 – Corporate actions of Bakrie & Brothers regarding Bumi plc and BORN, late 2011 ..... 174 Table 68 – BORN’s IPO proceeds: Planned vs Reported in 2012 Annual Report (IDR mn) ......... 174
Table 69 – Subsidiaries of Bumi plc, June 2012 ........................................................................... 177 Table 70 – ARMS company financials, 2011-2014 £(M) ............................................................. 181
Table 71 – BORN’s Shareholders, March 2006 – Sept. 2014 (shares) .......................................... 188 Table 72 – Trading suspension dates of BORN’s stock in IDX, 20130701-20160801 .................. 188
Table 73 – BORN’s Board of Commissioners, Dec. 2007 – Sept. 2014 ........................................ 189 Table 74 – BORN’s Board of Directors, Dec. 2007 – Sept. 2014 ................................................. 189
Table 75 – Corporate Officers in BORN group of companies, 2010 ............................................. 190 Table 76 – Related companies of BORN and transaction types, 2011-201409 (US$) ................... 190
Table 77 – Related companies of BORN and transaction types, 2007-2011 (IDR mn).................. 192 Table 78 – Third parties of BORN ............................................................................................... 192
Table 79 – BORN’s IPO underwriting fees detailed ..................................................................... 194 Table 80 – BORN’s IPO proceeds: Planned vs Reported in 2012 Annual Report (IDR mn) ......... 194
Table 81 – BORN’s outstanding loans, 20100630 ........................................................................ 195
Energy Industry in Indonesia & World's Renewable Energy – xv
Table 82 – The most vital financial figures of PT Borneo Lumbung Energi & Metal Tbk,
2006-2014q3 ......................................................................................................... 195 Table 83 – The financial structure of BORN (share of liabilities components to assets), 2009-
2014q3 .................................................................................................................. 196 Table 84 – Coal mineable reserves of BORN, March 2013 (mt)................................................... 207
Table 85 – Coal resources of BORN, March 2013 (mt) ................................................................ 207 Table 86 – BORN’s coal deposits in Kohong and Telakong blocks, 30 June 2010 (mt) ................ 207
Table 87 – BORN’s performance in coal productions, sales, and price, 2007-2013 ...................... 209 Table 88 – Tuhup coal product specification, 30 June 2010 ......................................................... 210
Table 89 – Grades of coking coal ................................................................................................. 212 Table 90 – Utilisation of installed capacity of BORN, 2007-2010H1 ........................................... 213
Table 91 – Third parties contracted in relation to barging and loading in ISP ............................... 214 Table 92 – Coal sales by marketers, 2011-2012 ($) ...................................................................... 215
Table 93 – BORN sales by country, 2009-2013 ........................................................................... 216 Table 94 – Management Boards of Asmindo Koalindo Tuhup, 1 Sept. 2010 ................................ 216
Table 95 – Changes in AKT shareholders, 1993 – 20091220 ....................................................... 216 Table 96 – The financials of AKT acquisition in 2008 and 2012 .................................................. 217
Table 97 – The financials of AKT, 2007 – 2010H1 ($) ................................................................ 218
List of Figures
Figure 1 – Degrees of capital requirement and asset life time in oil industry .................................... 1 Figure 2 – Risk-return investment profile in oil industry .................................................................. 1
Figure 3 – Average lead times between final investment decision and first production for
different oil resource types ........................................................................................ 2
Figure 4 – Supply response of US tight oil based on oil price in 2020. ............................................. 3 Figure 5 – Cellulosic ethanol breakeven crude oil price for competitiveness with gasoline .............. 3
Figure 6 – Components of total power generation costs, 2020 .......................................................... 4 Figure 7 – Components of total power generation costs, 2040 .......................................................... 4
Figure 8 – Components of electricity price, by regions and time frame ............................................ 5 Figure 9 – Lowered costs in power generation by renewables .......................................................... 5
Figure 10 – Share of renewables consumption in sector demand, 2005-2014, and forecast to
2020 ......................................................................................................................... 6
Figure 11 – Renewable power net additions to capacity under main and accelerated cases by
countries ................................................................................................................... 6
Figure 12 – Breakdown of global renewable energy use in 2010 ...................................................... 7 Figure 13 – Primary energy generation by supply and consumption in the US, 2014 ........................ 7
Figure 14 – Breakdown of global renewable energy use in 2030 ...................................................... 8 Figure 15 – Primary energy supply and consumption in the US, 2014 .............................................. 8
Figure 16 – Average weighted substitution cost and benefits by sector ............................................ 9 Figure 17 – Technology cost curve by primary energy source, 2030 .............................................. 10
Figure 18 – Renewable energy share in global energy consumption, 2013 ..................................... 11 Figure 19 – World energy consumption by end-use in 2012 & projection in 2040 (quadrillion
Btu) ........................................................................................................................ 12 Figure 20 – World energy consumption by source in 2012 & projection in 2040 (quadrillion
Btu) ........................................................................................................................ 12 Figure 21 – Conversion process from shale to fuel oil and byproducts ........................................... 15
Figure 22 – Liquid fuels classified ................................................................................................. 15 Figure 23 – Trends in oil intensity and GDP per capita in selected countries and regions ............... 17
Figure 24 – Early signs of commercialisation in the advanced biofuels sector ................................ 17 Figure 25 – World Energy Model .................................................................................................. 18
xvi – Energy Industry in Indonesia & World's Renewable Energy
Figure 26 – Energy forms .............................................................................................................. 20
Figure 27 – Global New Investment in Renewable Power and Fuels, Developed and
Developing Countries, 2004–2014 .......................................................................... 22
Figure 28 – Renewable Energy Share of Global Electricity Production, End-2014 ......................... 24 Figure 29 – Global renewables-based electricity generation by technology in the New Policies
Scenario .................................................................................................................. 25 Figure 30 – World net electricity generation by source in 2012 & projection in 2040 (trillion
kWH) ...................................................................................................................... 25 Figure 31 – World net electricity generation from renewables by source in 2012 & projection
in 2040 (trillion kWH) ............................................................................................ 26 Figure 32 – World net electricity generation from renewables by country in 2040 (billion
kWH) ...................................................................................................................... 26 Figure 33 – Power mix of renewable electricity in 24 hours ........................................................... 27
Figure 34 – Natural gas prices and the share of non-hydro renewables in the US power mix .......... 28 Figure 35 – Average Annual Growth Rates of Renewable Energy Capacity and Biofuels
Production, End-2009–2014 .................................................................................... 29 Figure 36 – Renewable Power Capacities* in World, EU-28, BRICS, and Top Seven
Countries, 2014 ....................................................................................................... 30 Figure 37 – Energy-related CO2 emissions and economic growth, 2005-2014 ............................... 31
Figure 38 – World energy-related carbon dioxide emissions (billion metric tons) .......................... 31 Figure 39 – Evolution of energy technology costs per unit in the New Policies Scenario, 2014-
2040........................................................................................................................ 32 Figure 40 – Extent of global mandatory efficiency regulation of final energy consumption by
sector and region ..................................................................................................... 35 Figure 41 – Enabling policy in supporting the renewable energy industry ...................................... 36
Figure 42 – Milestones on the road to competitiveness for renewables ........................................... 37 Figure 43 – Energy input–output cross-paths from primary sources to consumption sectors
and energy losses. ................................................................................................... 38 Figure 44 – US energy use, 2014, The Sankey Diagram of energy resources (left) flow to end-
use sectors (right) .................................................................................................... 39 Figure 45 – US Primary Energy Consumption by Source and Sector, 2014 .................................... 39
Figure 46 – U.S. Energy Flow, 2014 (Quadrillion Btu) .................................................................. 40 Figure 47 – World energy demand by fuel and sector in the New Policies Scenario, 2040
(Mtoe)..................................................................................................................... 41 Figure 48 – Power generation by fuel and demand by sector in the US (TWh) ............................... 42
Figure 49 – Power generation by fuel and demand by sector in the EU (TWh) ............................... 42 Figure 50 – Power generation by fuel and demand by sector in China (TWh) ................................ 43
Figure 51 – Power generation by fuel and demand by sector in India (TWh) .................................. 43 Figure 52 – Potential future global oil projects by average breakeven prices .................................. 46
Figure 53 – Australian monthly thermal coal price, Jan. 1980 – July 2016 (US$/metric ton) .......... 53 Figure 54 – Monthly coal prices from Australia, Colombia, South Africa, Jan. 1970 – July
2016 ($/mt) ............................................................................................................. 53 Figure 55 – American weekly coal prices, 20080506-20160812 (US$) .......................................... 54
Figure 56 – Various technologies implemented during power generation process .......................... 56 Figure 57 – Some chemical reactions in converting syngas ............................................................ 57
Figure 58 – Some routes of coal to chemicals from methane via syngas ......................................... 57 Figure 59 – Coal cycle and its derived products schematics, from liquid (CTL), to gas (CTG),
and chemicals (CTC) .............................................................................................. 58 Figure 60 – Potential UCG in the UK, 2004 ................................................................................... 59
Figure 61 – Kincardine UGC project area of interest, 20141105 .................................................... 61 Figure 62 – Kincardine UCG licenses in the Firth of Forth, 20150402. .......................................... 62
Figure 63 – Kincardine area of interest in Midland Valley of Scotland, 20141105 ......................... 63
Energy Industry in Indonesia & World's Renewable Energy – xvii
Figure 64 – Coalmines in British Columbia, Canada ...................................................................... 64
Figure 65 – Selected significant climate anomalies and events, July 2016 ...................................... 65 Figure 66 – Earth's Annual Global Mean Energy Budget, July 1987 – Dec. 1988 ......................... 66
Figure 67 – Earth’s Global Energy Budget, March 2000 – March 2004 ......................................... 66 Figure 68 – Monthly mean atmospheric carbon dioxide at Mauna Loa Observatory, Hawaii,
March 1958 – July 2016 (ppm) ............................................................................... 70 Figure 69 – Oxygen transport capability of different MeO/Me systems. ......................................... 71
Figure 70 – The effective aquifuge in Beizao Coalmine ................................................................. 76 Figure 71 – TBU Underwater coal mining in The Baltic Union...................................................... 77
Figure 72 – TBU Coal Island ......................................................................................................... 78 Figure 73 – TBU Sandisle structure ............................................................................................... 78
Figure 74 – Coal mines in Nova Scotia, Canada ............................................................................ 80 Figure 75 – Donkin coal resource block ......................................................................................... 80
Figure 76 – Solway Firth, Irish Sea, UK ........................................................................................ 83 Figure 77 – The map of Tynemouth-Boldon-Sunderland, NE England........................................... 85
Figure 78 – Deep coal mining closures in the UK, 2010-2015........................................................ 87 Figure 79 – Deep coal mining closures in the UK, 1960-1969........................................................ 87
Figure 80 – Onshore coal distribution in the UK by depth, 2014 .................................................... 88 Figure 81 – Oil reserves in Indonesia, 2014 ................................................................................... 90
Figure 82 – Installed capacity of oil refineries in Indonesia, 2014 .................................................. 92 Figure 83 – Natural gas reserves in Indonesia, 2014 ...................................................................... 94
Figure 84 – LNG plants in Indonesia, 2015 .................................................................................... 97 Figure 85 – LNG plants infrastructure in Indonesia, 2015 .............................................................. 98
Figure 86 – LNG Applications ....................................................................................................... 99 Figure 87 – Gas transmission and distribution in Indonesia, 2010-2025 ....................................... 100
Figure 88 – Bottling plants of LPG in Indonesia, 2015................................................................. 103 Figure 89 – LPG supply scheme from import and 3 PSCs to 3 main terminals ............................. 104
Figure 90 – CBM Basins in Indonesia.......................................................................................... 105 Figure 91 – Coal bed methane (CBM) resources in Indonesia, 2010 ............................................ 106
Figure 92 – CBM PSC terms in Indonesia ................................................................................... 106 Figure 93 – Some CBM PSCs in East Kalimantan ....................................................................... 109
Figure 94 – CBM basin in South Sumatera, Nov. 2011 ................................................................ 112 Figure 95 – Tanjung Enim CBM PSC .......................................................................................... 113
Figure 96 – Muralim CBM PSC .................................................................................................. 114 Figure 97 – Sangatta West CBM PSC .......................................................................................... 116
Figure 98 – The CBM PSCs of NuEnergy in Sumatera ................................................................ 117 Figure 99 – Gasification-based system concepts .......................................................................... 119
Figure 100 – Gasification chemistry ............................................................................................ 119 Figure 101 – Coal distribution in Indonesia by calory class, 2014 ................................................ 120
Figure 102 – Supply and export of Indonesian coal, 1997-2014 ................................................... 121 Figure 103 – Export share over coal production in top producing countries ................................. 121
Figure 104 – Coal seaports in Indonesia, 2015 ............................................................................. 123 Figure 105 – UK banks involvement in Indonesian coal companies ............................................. 124
Figure 106 – Mining permits in Indonesia, 20140203 .................................................................. 125 Figure 107 – Mining problems in Indonesia, 20140203 ............................................................... 138
Figure 108 – JORC's general relationship between exploration results, mineral resources, and
ore reserves ........................................................................................................... 138
Figure 109 – Problems of Non-Clean & Clear Status of IUPs classified and mapped ................... 141 Figure 110 – Adding value to the coal by implementing clean coal technology ............................ 143
Figure 111 – Coal DMO mechanism in Indonesia ........................................................................ 144 Figure 112 – Monitoring and reporting system on the implementation of coal DMO
mechanism in Indonesia ........................................................................................ 145
xviii – Energy Industry in Indonesia & World's Renewable Energy
Figure 113 – Clean & Clear Status of IUPs, May 2011 – April 2016 ............................................ 148
Figure 114 – The mechanics of $600m structure finance (fixed rate note) of IndoCoal in 2005 .... 164 Figure 115 – The mechanics of unrated $900m structured export notes (FRN) of IndoCoal in
2006...................................................................................................................... 164 Figure 116 – Share price of Vallar plc, Bumi plc, and Asia Resource Minerals plc, 9 July
2010 – 10 August 2015 ......................................................................................... 166 Figure 117 – The owners of BLE ................................................................................................. 168
Figure 118 - The net debt maturities of PT Borneo Lumbung Energi & Metal Tbk, 2012q1 ......... 169 Figure 119 - The debt burdens of PT Borneo Lumbung Energi & Metal Tbk, 2012q1 .................. 169
Figure 120 – The flows of debts and stakes within companies related with PT Borneo
Lumbung Energi & Metal Tbk (BORN), Nov.2010 ............................................... 170
Figure 121 – The interests of BNBR and LHHL in Bumi plc, December 2011 ............................. 175 Figure 122 – The interests of BORN and Samin Tan in Bumi plc, June 2012 ............................... 176
Figure 123 – Bumi plc related companies, from shareholders to subsidiaries, June 2012 .............. 177 Figure 124 – The interests of BORN and Samin Tan in Bumi plc, prior to March 2014 ............... 179
Figure 125 – Heart of Borneo: Three countries, One conservation vision ..................................... 183 Figure 126 – Transfers of $15m loan of AKT .............................................................................. 191
Figure 127 – Transfers of $50m loan of BMS .............................................................................. 191 Figure 128 – Transfers of $75m loan of BORN............................................................................ 191
Figure 129 – Transfer of advance and receivable of ETU in BMS and BORN to REM ................ 191 Figure 130 – Classification of asset structure, financial structure, and capital structure ................ 196
Figure 131 – AKT's coal deposit, 200511-201109........................................................................ 203 Figure 132 – BORN's coal specification, worldwide comparation ................................................ 203
Figure 133 – Indonesian coal producers by mine sites .................................................................. 204 Figure 134 – Sea access of AKT as BORN's asset........................................................................ 205
Figure 135 – The site map of Muara Tuhup and Damparan in Central Kalimantan ....................... 206 Figure 136 – Mining activities cycle of AKT ............................................................................... 208
Figure 137 – BORN monthly production, Oct.2008 – June 2010 (000 ton) .................................. 209 Figure 138 – Coal classification by energy content ...................................................................... 211
Figure 139 – Bulk carriers compared by size, from Handysize to Capesize .................................. 213