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INDONESIA COAL: A KEY FUEL SOURCE FOR INDUSTRIAL OPERATIONS

Indonesian coal plays a crucial role in balancing energy and fuel prices in Asian countries. With its high-quality coal reserves ranking among the top globally and accounting for approximately 2.2% of the total global coal reserves, Indonesia stands as one of the largest producers and suppliers of coal worldwide.

1. Overview of Indonesian Coal

- Indonesia stands as a leading nation in terms of coal reserves and coal export ratios in both Asia and globally. Indonesian coal is among the precious resources of this Southeast Asian country, formed through natural processes over millions of years. During this time, layers of prehistoric vegetation were buried beneath the Earth's crust due to geological transformations. Along with temperature, moisture, bacteria, and the pressure of the Earth's crust, this layer of organic material underwent decomposition, gradually forming coal.

- With its abundant supply, high quality, low cost, easy transportation, and minimal environmental impact, Indonesian coal is being widely utilized as a fuel for steam boilers providing energy in various industries such as chemicals, textiles, food, paper, and packaging. It serves as a stable supply source, helping to reduce production costs compared to other fuels, thus playing a crucial role in industrial development.

- Indonesian coal is categorized into four main groups:

	*Group 1*	*Group 2*	*Group 3*	*Group 4*
*Energy*	Very high	High	Medium	Low
*Calorific value*	Above 71000 kcal/kg	6100 – 7100 kcal/kg	5100 – 6100 kcal/kg	Around 5100 kcal/kg

2. The Potential of Indonesian Coal

- The total coal potential of Indonesia is approximately 161 billion tons. Of this, around 121 billion tons are extracted through surface mining methods, while approximately 40 billion tons are from underground mining. Indonesia's main coal exports consist of lignite and bituminous coal.

- Currently, the growth rate of coal in Indonesia surpasses that of Vietnam's coal industry by a significant margin. Overall, the Indonesian coal industry exhibits a highly sustainable development, maintaining a balance between extraction output, explored reserves, and surveyed potential. This stability has led to a continuous increase in investment in the coal mining sector in Indonesia.

- The largest markets for coal are in Asia, with China and India currently accounting for 56% of global coal consumption, with a significant portion of their demand being met by Indonesian coal. Due to its geographical proximity to these two major markets, Indonesia holds a considerable competitive advantage over other continents with large coal exports. Lower transportation costs and/or the ability to use smaller vessels contribute to the ease of supply from Indonesia to Asian countries.

- All of these factors have contributed to the increase in Indonesian coal exports, with Vietnam being one of the countries importing a substantial amount of Indonesian coal. To understand why Vietnam imports such large quantities of coal from Indonesia, it is essential to examine the quality of Indonesian coal below.

3. Characteristics of Indonesian Coal

- The appearance and size of Indonesian coal can vary depending on the type, but it's typically distinguishable by its black or dark brown color, glossy surface, and oily residue.

- It is primarily composed of carbon with high sulfur content and trace amounts of other elements. Indonesian coal is known to be volatile and easily ignitable. In terms of moisture content, raw coal may have slightly higher moisture levels but still fall within acceptable ranges for efficiency. Let's explore some specific characteristics to gain a deeper understanding of the composition and components of Indonesian coal:

Heat value: Varied, distributed evenly across four levels from low to high, with an average heat value ranging from 5000 – 7000 kcal/kg.
Ash content: Typically between 3 - 8%, although high heat value coal may have higher ash content, often exceeding 10%.
Sulfur content: Approximately 0.2 - 0.6%, though coal mined in East Kalimantan may have higher sulfur content.
Moisture: Inverse relationship with heat value, higher heat value coal tends to have lower moisture content. Indonesian coal has a low moisture content, typically less than 10%, with moisture increasing by approximately 38-40% for every 3,800 kcal/kg of heat released.

Learn more: What is coal? Characteristics, classification and applications of coal

4. Common Types of Indonesian Coal

- Indonesia produces various types of coal, ranging from high-quality bituminous coal to others such as anthracite and sub-bituminous coal. Each type of coal has distinct characteristics and is applied in different sectors such as power generation, chemical industries, and steel production.

Indonesian Lignite (Brown Coal): This type of coal has a low heat value, around 4165 kcal/kg, with chemical components causing high volatility, accounting for over 31%, and moisture content exceeding 66%.
Indonesian Coking Coal: This type of coal has an average heat value of about 5700 kcal/kg. Indonesian coking coal is particularly favored due to its low ash content, sometimes not producing ash during combustion, making it widely used in processes such as iron smelting and odor removal in the metallurgical industry.
Indonesian Bituminous and Anthracite Coal: Bituminous coal is formed after sub-bituminous coal and eventually becomes anthracite. Both types of coal are used as combustion fuels in industrial boilers. Bituminous coal has lower quality compared to anthracite. Depending on the specific requirements, either bituminous or anthracite coal can be applied accordingly.
Indonesian Sub-Bituminous Coal: This type of coal is similar to Indonesian lignite and is widely used in heat generation processes. However, sub-bituminous coal is more commonly used due to its superiority over lignite. The heat value of Indonesian sub-bituminous coal ranges from 4165 to 5700 kcal/kg.

5. Benefits of Using Indonesian Coal

- Indonesian coal is evaluated by experts as one of the highest-quality coals globally, with low ash and sulfur content. These are among the primary factors in choosing coal for power plants and industries. Below are the prominent benefits of using Indonesian coal:

High calorific value, easy combustion: One of the highly regarded quality characteristics of Indonesian coal is its high calorific value, making it easy to combust with readily available materials in Vietnam.
Easy transportation, minimal environmental impact: Indonesian coal has low ash content, making it easier to transport and causing minimal environmental impact. Due to the geographical proximity, freight costs from Indonesia to Vietnam are relatively low, resulting in an affordable and swift supply of Indonesian coal.
Stable supply source: Indonesia boasts abundant coal reserves, ensuring a steady and continuous supply to the market.
Cost-saving: Indonesian coal is relatively inexpensive and has a large supply, contributing to lowering the prices of other fuels such as diesel oil (DO), fuel oil (FO), FO-R, liquefied petroleum gas (LPG), and some higher-priced fuels.

6. Why Choose Thuan Hai as the Supplier of Indonesian Coal in Vietnam?

- With the increasing demand for Indonesian coal in the Vietnamese market, Thuan Hai is one of the first private enterprises specializing in coal importation and trading in Vietnam. We provide industrial coal to major manufacturing plants, delivering high economic value to our customers.

- Thuan Hai has established long-term cooperative relationships with major coal mines. This advantage enables us to ensure stable and continuous coal reserves. We are committed to ensuring the quality of our products by conducting on-site inspections at coal mines and rigorously inspecting the coal sources before transportation to Vietnam. To maintain quality stability, our coal is stored in enclosed warehouses equipped with roofing, conveyor belts, and dust filtration systems to protect the environment. We invest in modern equipment such as laboratories, moisture testing machines, and thermal testing machines to regularly monitor the quality of fuel from input to output.

- Thuan Hai has established a network of 6 satellite warehouses stretching from North to South with a total capacity of 1.2 million tons, strategically located near industrial zones and major transportation routes. This facilitates more convenient importation and storage of fuel. Additionally, we have a fleet of over 100 vehicles and vessels to optimize costs and transportation time for our customers. Purchasing procedures are also conducted promptly and professionally to ensure customer satisfaction