Over the past two decades, Indonesia's coal industry has transformed itself from being an unknown, minor player in Asia's coal markets to the world's largest exporter of steam coal. In what is likely the most detailed analysis of the Indonesian coal industry ever released, Dr. Bart Lucarelli tells the story of how Indonesia created this world-scale industry over two decades despite challenges created by widespread government corruption, a weak legal system, the Asian Financial Crisis of 1997, and the fall of the Soeharto government in 1998.

The paper argues that key physical and technical factors, along with regulatory and political factors, have acted as the primary drivers of the industry's phenomenal growth over the past two decades and will be the most important factors for consideration over the next two decades.  It also discusses current estimates of Indonesia's coal resources and reserves, the role played by location and geological factors in the development of its coal resources, the future impacts of the passage of Indonesia's Mining Law of 2009 and its related implementing regulations, and how these issues might affect the coal industry's structure and performance before 2020.