Jakarta (ANTARA News) - Indonesia will not impose a ceiling on coal exports as domestic demand is still below production, the energy minister said on Thursday. Indonesia, the world's largest exporter of thermal coal, is expected to produce 196 million tonnes of coal this year with domestic consumption seen at 49 million tonnes, data from the energy ministry showed.
"Domestic market obligation for coal is included in contracts but we don't need it because domestic demand is small," Purnomo Yusgiantoro was quoted by Reuters as telling reporters.
"We will produce coal based on demand and we won't set a ceiling on exports."
The country is expected to export 147 million tonnes this year.
Coal output is likely to rise nearly 11 percent next year as producers increase capacity, but demand for coal is also set to soar as industries switch from petroleum to coal.
Indonesia is expected to consume 75 million and 90 million tonnes of coal in 2009 and 2010, respectively.
The expected increase in domestic coal demand is because of government plans to generate an additional 10,000 megawatts (MW) of electricity by 2010, some of it from coal-fired plants.
Industry officials said coal exports were likely to slow because of the expected increase in domestic demand.
Indonesia is expected to export 148 million tonnes of coal in 2008. Coal exports would increase by only 2 million tonnes to 150 million tonnes in 2009.
The country is the Asia-Pacific's only member of the Organization of the Petroleum Exporting Countries. But as its oil reserves dwindle, it is turning to alternative sources of energy such as coal and natural gas to meet rising demand for power.
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