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All eyes on Indonesia’s state-owned Perusahaan Listrik Negara (PLN)

The republic’s exports can only resume if PLN confirms it has sufficient stockpile

It has been a roller coaster ride for Indonesia’s coal market this month, especially for miners and plantations. However, if the country’s state-owned utility company PLN confirms its supply to be sufficient for 15 operational days, the export ban would be lifted.

Country-wide nail-biting wait
All it took for Indonesia to impose the ban was also PLN’s declaration of critically low supply. Coal miners were struggling to cope with the month-long export ban imposed by Ridwan Jamaludin, Director General of Mineral and Coal at the Energy Ministry. President Joko Widodo dished a nasty threat to revoke export and business permits for coal producers that failed to fulfil domestic obligations. The hardball came shortly after – an official revoking of thousands of mining and plantation permits!

Subsequently, Indonesia granted 14 coal-loaded vessels to depart, but it turned out all vessels were still awaiting formal approval as at 12 January 2022 – according to Mugen Suprihatin Sartoto, an official from the Transportation Ministry. The Indonesian government is waiting for PLN to declare that it has secured enough coal before it can decide to end the export ban, as Energy Minister Arifin Tasrif revealed.

He added that the ban lift would be executed partially if it happens. “We will prioritise miners who fulfilled 100 per cent of their domestic market obligations (DMO),” he pointed, which decreed miners to sell 25 per cent of their output to local market at a maximum price of US$70 per tonne for power plants. Regrettably, PLN offered no comments.

As it is now, Japan is closely monitoring the situation and may turn to liquefied natural gas (LNG) if its Indonesian supply remains unstable. Other importers like South Korea and the Philippines also feared the worst – domestic disruption. The power outage will be earthshaking for their economies. The next question is: would the other countries start planning contingencies too?

Marine Online News Team
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