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Agency for Natural Resources and EnergyThe Sixth Japan-Indonesia Coal Policy Dialogue

On Wednesday, June 18, 2014, the Agency for Natural Resources and Energy held the Sixth Japan-Indonesia Coal Policy Dialogue in Jakarta, Indonesia, with the Ministry of Energy and Mineral Resources of Indonesia, in order to promote a wide range of cooperation, from coal exploration and development to coal utilization.

1. Background

As Indonesia is Japan's second largest supplier of coal (following Australia) and accounts for 20% of all coal imported to Japan, it is a very important country for Japan in terms of ensuring a stable supply of coal.

In this context, a wide range of cooperation, including the exploration and development of coal mines and coal utilization, has continued for a long time between Japan and Indonesia. The Japan-Indonesia Coal Policy Dialogue aims to promote such cooperation, and this time marked the sixth session.

2. Outline of the Sixth Japan-Indonesia Coal Policy Dialogue

There were about 40 participants in total from both countries (as referred to below), including Mr. Katsuhisa Shimakura, Director for Coal Policy, METI, from Japan, and Dr. R. Sukhyar, Director General, Directorate General of Mineral and Coal, Ministry of Energy and Mineral Resources, from Indonesia. The following results were achieved.

  1. Participants discussed the maintenance and improvement of ongoing and stable coal trading between Japan and Indonesia. The Government of Japan expressed concern towards the Government of Indonesia on the policy measures implemented by Indonesia, namely, enhancing the domestic market obligation (DMO), considering production control and raising the royalty rate, and also requested the improvement of infrastructure and an investment environment in relation to coal mine development. In addition, Japan stated that it is willing to provide cooperation for coal exploration and development that contribute to the stable supply of coal to Japan. Both countries confirmed that they will continue discussing such mutually beneficial cooperation.
  2. In Indonesia, the effective utilization of low-rank coal is recognized as an important policy issue. Both countries confirmed that cooperation should be further promoted toward the goal of having the relevant technologies—slurry formation, gasification, and upgrading of low-rank coal—introduced into Indonesia. In this context, as a measure to promote the introduction of these technologies, the Government of Japan proposed that the Government of Indonesia consider introducing a tax exemption as well as other incentives.
  3. There are many plans for construction of high-efficiency coal-fired power generation plants in Indonesia, and both countries reaffirmed the importance of cooperation in this area. The Government of Japan requested the Government of Indonesia to provide support, including the improvement of the surrounding environment, so as to ensure that these construction projects of coal-fired power generation plants will go on swiftly. Furthermore, the Government of Japan requested proper evaluation of the advanced facilities, and operation and maintenance technologies of Japanese companies in new coal-fired power generation projects, as well as cooperation for smooth implementation of Japan's public financing support measures.

3. Future Direction

METI will make efforts to further enhance the cooperative relationship between Japan and Indonesia in the area of coal, and to ensure the stable supply of coal from Indonesia to Japan, as well as to contribute to the realization of efficient and environmentally-friendly power supply in Indonesia by introducing Japan's state of the art technology for coal-fired power generation to Indonesia.

(Japanese participants)
METI, Embassy of Japan in Indonesia, Japan Oil, Gas and Metals National Corporation (JOGMEC), New Energy and Industrial Technology Development Organization (NEDO), Japan International Cooperation Agency (JICA), Nippon Export and Investment Insurance (NEXI), and Japan Coal Energy Center (JCOAL)

(Indonesian participants)
Ministry of Energy and Mineral Resources (Directorate General of Mineral and Coal; Directorate General of Electricity, Geology Agency; Research and Development Agency, and Education and Training Agency), Coordinating Ministry of Economic Affairs, PT Tambang Batubara Bukit Asam (PTBA), PT PLN (Persero) and Indonesian Coal Mining Association (ICMA)

Release Date

June 20, 2014

Division in Charge

Coal Division, Natural Resources and Fuel Department, Agency for Natural Resources and Energy

Related Information

Regional Affairs / Indonesia

Ministry of Economy, Trade and Industry
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