PT Anggun Makmur Energy (PT AME) is to supply steam coal to power plants in Vietnam as part of an offtake agreement agreed with Commodities Intelligence Centre (CIC) on behalf of its trading platform registered users.
The total contract value is $8.5 million, with the first coal shipment produced by “clean coal technologies” commencing in October 2019.
This agreement will reduce cross-border transaction costs and achieve greater trading synergies in the region, strengthening Singapore’s role as an international trading hub, according to CIC. It also has the potential to influence expansion into other markets in Asia, such as China and the Philippines.
Coal dominates world power generation and is an important and crucial commodity for Asia Pacific, according to CIC. The International Energy Agency, in 2018, estimated Asia produced 70% of the world’s coal, with coal demand projected to grow 5% year-on-year to support the growth of Southeast Asia.
CIC said: “Despite its strong demand, low-cost coal runs counter to the global trend that is looking to cut carbon emissions. As coal continues to be the dominant fuel for power generation in Southeast Asia and Asia-Pacific, the development of clean coal technology and innovative solutions can reduce the environmental pollution that coal brings to the world.”
PT AME is an Indonesia-based coal miner that, through its mining practices, is enabling independent power plants (IPPs) to comply with global CO2 emission standards. Its mines generate less coal ash than others in the industry, according to CIC.
“Their (PT AME’s) technology is able to revive the region’s economically dead mines or old mines with good coal, producing lower volumes of waste material when extracting one-unit tonne of coal,” CIC said. “The overall cost of coal mining is also reduced by up to 80%, providing cost savings to the operation and maintenance of IPPs.”
Peter Yu, Chief Executive Officer of CIC, said: “This partnership with PT AME marks a significant milestone achieved by CIC that will facilitate intra-ASEAN trade and strengthens Singapore’s role as an international trading hub in the digital realm.”
Pak Djoko, President Director of PT AME (pictured left), quoting a 2017 report from Danish Energy Agency, said Vietnam’s import share of total primary energy supply is set to increase to 37.5% in 2025 and 58.5% in 2035 with high demand on imported fuel, especially coal.
He added: “We believe that PT AME will be able to use best practices garnered from our experience in the Asia-Pacific region in supplying the necessary energy source, to meet the demands of Vietnam. Moreover, CIC’s eTrade Platform extensive network and market knowledge will allow us to enter the Vietnam market with confidence and help bring our sustainable and environmental-friendly mining practices to the country.”
CIC is a Singapore-based platform backed by Enterprise Singapore, and is a joint venture between ZALL Smart Commerce Group, a business-to-business (B2B) platform in China; Singapore Exchange; and Global eTrade Services, a subsidiary of eGovernment products and services provider CrimsonLogic. CIC aims to create an interoperable global B2B physical commodities trading platform with global connectivity.