# Coal - where to now?



## markrmau

As you may have seen, coal stocks have been hammered recently (EXL,CEY,MCC...) because of big drops in price of coal.

But just possibly, could good old booring coal be the next boom commodity?

China is looking at 'liquefying' coal, to act as an oil replacement.

http://www.globalcoal.com/news/coalnews.cfm

While U is booming ATM, the problem is that U is only used to create electricity (on any meaningful scale). But electricity is basically not storable in significant quantities, so is not much good for mobile needs (cars, trucks etc). That is why petrol (oil) is vital to the economy.

But if in future years, a liquid energy source can be obtained from coal, coal COULD go through the roof.

I like EXL for a pure coal play (don't own any ATM). SRL probably better as it is a diversified miner and has other interests.


----------



## excalibur

Good Argument Markrmau.
Could be a good reason why oil price is deflating.
I fear that the price of coal will explode.
Coal mine stocks are behaving very peculiar. Won`t be surprised for a breakout.
Cheers from Germany


----------



## michael_selway

markrmau said:
			
		

> As you may have seen, coal stocks have been hammered recently (EXL,CEY,MCC...) because of big drops in price of coal.
> 
> But just possibly, could good old booring coal be the next boom commodity?
> 
> China is looking at 'liquefying' coal, to act as an oil replacement.
> 
> http://www.globalcoal.com/news/coalnews.cfm
> 
> While U is booming ATM, the problem is that U is only used to create electricity (on any meaningful scale). But electricity is basically not storable in significant quantities, so is not much good for mobile needs (cars, trucks etc). That is why petrol (oil) is vital to the economy.
> 
> But if in future years, a liquid energy source can be obtained from coal, coal COULD go through the roof.
> 
> I like EXL for a pure coal play (don't own any ATM). SRL probably better as it is a diversified miner and has other interests.




Hi yeah i like EXL too, dont have any yet, ir dropped a bit more today due to an annoucement of increase costs

However if u look at the Forecasts (comsec), they seem very good even despite drop in Coal Prices/SP? Forecast EPS for 2008 is 136.5c? thats a PE of under 5 using current SP? Nice dividends too

EPS(c) PE Growth 
Year Ending 30-06-06 70.2 9.1 42.3% 
Year Ending 30-06-07 117.7 5.4 67.7% 

Earnings and Dividends Forecast (cents per share) 
 2005 2006 2007 2008 
EPS 49.3 70.2 117.7 136.5 
DPS 24.0 35.0 49.0 70.5

Thoughts anyone?

Thanks

MS


----------



## Julia

I have quite a few EXL bought May 04 at $2.20, and, despite present lowered SP, am happy to be holding for a recovery:  regard it as a long term stock.

Julia


----------



## michael_selway

Julia said:
			
		

> I have quite a few EXL bought May 04 at $2.20, and, despite present lowered SP, am happy to be holding for a recovery:  regard it as a long term stock.
> 
> Julia




HI Julia, there are 2 stocks that u bought low on, GTP and EXL

At current prices, which woudl you favour more and why? Both stocks have dropped a bit this yr

thx

MS


----------



## nizar

exl quarterly out 2day...

looks good 2 me, market doesnt seem 2 think so...

maybe a buying opportunity?


----------



## Julia

To contradict my earlier post, I sold all my EXL a couple of weeks ago.  The stock had done pretty well for me (bought at $2.20), it was down more than $2 off its high and the chart showed a continuous descent.  Happy to take my profits and go.  Since then the price has been erratic.  I'm happy to be out for now - there's just too much uncertainty about coal prices for me at present.

Michael:  really wouldn't like to compare GTP and EXL.  I've sold some of my GTP and, although I believe the fundamentals for GTP in the longer term are excellent, I'll sell more at the annual peak of May/June if not before, not because of any unhappiness with the company but just because I'm overweight in this stock.

Julia


----------



## michael_selway

Julia said:
			
		

> To contradict my earlier post, I sold all my EXL a couple of weeks ago.  The stock had done pretty well for me (bought at $2.20), it was down more than $2 off its high and the chart showed a continuous descent.  Happy to take my profits and go.  Since then the price has been erratic.  I'm happy to be out for now - there's just too much uncertainty about coal prices for me at present.
> 
> Michael:  really wouldn't like to compare GTP and EXL.  I've sold some of my GTP and, although I believe the fundamentals for GTP in the longer term are excellent, I'll sell more at the annual peak of May/June if not before, not because of any unhappiness with the company but just because I'm overweight in this stock.
> 
> Julia




Hi Julia

ok thx, when u say "overweight" does that mean u have to much in your portfolio? 

Also GTP u say there is an annual peak May/June GTP? Do you know why?

EXL MCC CEY GCL, yeah very unstable atm, hard to say which way it will go

Thanks

MS


----------



## Julia

Hi Michael,

Yes - overweight means exactly that.  It happened for a number of reasons which are not relevant here.  I don't mind being similarly overweight in, e.g., some of the banking stocks, but am not comfortable when it's something as volatile as GTP

Re the annual peak.  This occurs when there is heavy buying of the various "Trees" managed invesment schemes (buying of the tree lots themselves) because of the tax advantages for the end of the financial year.  The perception of the extra renenue/profit to the company seems to carry through to the SP.

Regards

Julia


----------



## nizar

Julia said:
			
		

> Hi Michael,
> 
> Yes - overweight means exactly that.  It happened for a number of reasons which are not relevant here.  I don't mind being similarly overweight in, e.g., some of the banking stocks, but am not comfortable when it's something as volatile as GTP
> 
> Re the annual peak.  This occurs when there is heavy buying of the various "Trees" managed invesment schemes (buying of the tree lots themselves) because of the tax advantages for the end of the financial year.  The perception of the extra renenue/profit to the company seems to carry through to the SP.
> 
> Regards
> 
> Julia




hey julia

u mean all companies generally experience sp peaks at end of financial yr? do u mean our financial year (30 June) or like the specific companies' end of financial yr eg. MBL end of financial yr is 31st March and they report mid-May.


----------



## Julia

Nizar:

No, I do not mean that all companies experience peaks at the end of the financial year (30 June).  

If you look back through the thread on GTP (rather than get off track on the "Coal" thread, you will probably find several posts on the special situation regarding not only GTP but other companies who have MIS (managed investments schemes) which are mostly bought for their tax advantages.

Julia


----------



## Julia

Nizar:

No, I do not mean that all companies experience peaks at the end of the financial year (30 June).  

If you look back through the thread on GTP (rather than get off track on the "Coal" thread), you will probably find several posts on the special situation regarding not only GTP but other companies who have MIS (managed investments schemes) which are mostly bought for their tax advantages.

Julia


----------



## Smurf1976

Some non-financial background info on coal for those who are interested... Ignore this if you're only interested in price charts etc.

As a rough guide, there's the same energy (heat) content in a metric tonne of export grade (thermal) black coal as there is in 4.4 barrels of crude oil. That will vary a bit depending on the grade of coal and source of oil.

Coal ranges from lignite (brown coal) to sub-bituminous to black to anthracite. There are various sub categories within those groups. Actual mining in Australia for black coal (the common exportable grade) takes place mostly in Qld and NSW and on a much smaller scale in WA where it's used locally in industry and power stations. Australia's coal exports originate from Qld and NSW. Vic (lignite), SA (a rather unique type of sub-bituminous coal) and Tas (sub-bituminous) do not produce coal suitable for export. Production in those states is used locally for power generation (Vic, SA) and heavy industry, particularly paper mills and cement works (Tas). Coal is not mined in the NT.

The main way that coal competes with other fuels is for the generation of electricity. In Australia, about 80% of all electricity is produced from coal. About 10% comes from hydro (60% of that in Tas) and the rest is mostly from natural gas (WA and SA dominate gas consumption for electricity generation but it's used in all states and supplies 95% of total generation in NT). Small amounts of oil are used for startup of coal-fired plant, in isolated communities and for peak power generation to the main grid.

Internationally, coal is far less dominant but is still by far the most important resource used for electricity generation. The major international sources are coal, nuclear, hydro, gas and oil in that order. There is significant room for coal to grow at the expense of nuclear and/or gas. 

In the USA it's coal, nuclear, gas, hydro, oil in that order. In the UK it's gas, coal, nuclear and small amounts of various others (oil, renewables) in that order. In New Zealand it's hydro, gas/coal (there's significant switching between the two according to availability), geothermal and oil in that order.

Oil tends to be used mostly for peaking plants or as backup and in general it would not be economic to construct new coal-fired plant for this purpose unless the oil price really does head to the moon. New Zealand just built a new oil-fired plant solely for backup use. Coal and particularly gas-fired plants often use oil as a backup when the primary fuel source is in short supply. Various gas-fired plants in Australia do this from time to time.

Existing hydro plants have virtually zero cost and thus aren't likely to be prematurely replaced and they have long lives. Typically they're designed for a minimum life of 70-90 years although for most plants they ought to survive far longer than that with proper maintenance. There's quite a few 100+ year old hydro plants still fully operational with the original machinery.

Non-hydro renewable energy sources aren't a serious contender as a _replacement_ for conventional power sources at the present time. They are, however, a clean and useful supplement in many cases.

So in practice it's coal versus nuclear versus gas. As gas becomes expensive (far too expensive for economic power generation in US and UK now) it comes back to nuclear versus coal and that is more a question of politics than anything else.

If coal liquefaction ever gets off the ground in a big way then that would certainly increase coal demand. However, much of the interest so far is in using low grade brown coal rather than black coal. Various plants have been proposed in Victoria and New Zealand amongst other places. In my opinion there won't be serious demand for black coal as a feedstock for "oil" production in the next 10 years as there simply isn't anywhere near sufficient investment being made to build the necessary liquefaction plants on sufficient scale. That doesn't mean there will be _no_ demand for coal for that purpose though.

Coal is also relatively abundant comapred to oil and it's still very easy to increase coal production. No different to any other mineral apart from oil/gas in that sense. It lacks genuine scarcity. Of course that doesn't preclude a bull market, but it lacks the sort of scarcity which leads to wars etc.

This post for info only. I have intentionally not drawn any conclusions regarding price. Think about it and reach your own conclusions.


----------



## Julia

Hi Smurf
 Thanks for a really informative and interesting post.  Would you say what happens from here in terms of choices of energy supply etc. is more politically determined than anything else?

Julia


----------



## michael_selway

Smurf1976 said:
			
		

> Some non-financial background info on coal for those who are interested... Ignore this if you're only interested in price charts etc.
> 
> As a rough guide, there's the same energy (heat) content in a metric tonne of export grade (thermal) black coal as there is in 4.4 barrels of crude oil. That will vary a bit depending on the grade of coal and source of oil.
> 
> Coal ranges from lignite (brown coal) to sub-bituminous to black to anthracite. There are various sub categories within those groups. Actual mining in Australia for black coal (the common exportable grade) takes place mostly in Qld and NSW and on a much smaller scale in WA where it's used locally in industry and power stations. Australia's coal exports originate from Qld and NSW. Vic (lignite), SA (a rather unique type of sub-bituminous coal) and Tas (sub-bituminous) do not produce coal suitable for export. Production in those states is used locally for power generation (Vic, SA) and heavy industry, particularly paper mills and cement works (Tas). Coal is not mined in the NT.
> 
> The main way that coal competes with other fuels is for the generation of electricity. In Australia, about 80% of all electricity is produced from coal. About 10% comes from hydro (60% of that in Tas) and the rest is mostly from natural gas (WA and SA dominate gas consumption for electricity generation but it's used in all states and supplies 95% of total generation in NT). Small amounts of oil are used for startup of coal-fired plant, in isolated communities and for peak power generation to the main grid.
> 
> Internationally, coal is far less dominant but is still by far the most important resource used for electricity generation. The major international sources are coal, nuclear, hydro, gas and oil in that order. There is significant room for coal to grow at the expense of nuclear and/or gas.
> 
> In the USA it's coal, nuclear, gas, hydro, oil in that order. In the UK it's gas, coal, nuclear and small amounts of various others (oil, renewables) in that order. In New Zealand it's hydro, gas/coal (there's significant switching between the two according to availability), geothermal and oil in that order.
> 
> Oil tends to be used mostly for peaking plants or as backup and in general it would not be economic to construct new coal-fired plant for this purpose unless the oil price really does head to the moon. New Zealand just built a new oil-fired plant solely for backup use. Coal and particularly gas-fired plants often use oil as a backup when the primary fuel source is in short supply. Various gas-fired plants in Australia do this from time to time.
> 
> Existing hydro plants have virtually zero cost and thus aren't likely to be prematurely replaced and they have long lives. Typically they're designed for a minimum life of 70-90 years although for most plants they ought to survive far longer than that with proper maintenance. There's quite a few 100+ year old hydro plants still fully operational with the original machinery.
> 
> Non-hydro renewable energy sources aren't a serious contender as a _replacement_ for conventional power sources at the present time. They are, however, a clean and useful supplement in many cases.
> 
> So in practice it's coal versus nuclear versus gas. As gas becomes expensive (far too expensive for economic power generation in US and UK now) it comes back to nuclear versus coal and that is more a question of politics than anything else.
> 
> If coal liquefaction ever gets off the ground in a big way then that would certainly increase coal demand. However, much of the interest so far is in using low grade brown coal rather than black coal. Various plants have been proposed in Victoria and New Zealand amongst other places. In my opinion there won't be serious demand for black coal as a feedstock for "oil" production in the next 10 years as there simply isn't anywhere near sufficient investment being made to build the necessary liquefaction plants on sufficient scale. That doesn't mean there will be _no_ demand for coal for that purpose though.
> 
> Coal is also relatively abundant comapred to oil and it's still very easy to increase coal production. No different to any other mineral apart from oil/gas in that sense. It lacks genuine scarcity. Of course that doesn't preclude a bull market, but it lacks the sort of scarcity which leads to wars etc.
> 
> This post for info only. I have intentionally not drawn any conclusions regarding price. Think about it and reach your own conclusions.




Hi Smurf thx!

Btw do u knwo why there was a surge in Coal Prices prior in 2004, thus the rise of EXL, MCC, CEY, GCL (before they dropped in 2005)?

MS


----------



## excalibur

2005 was of course a boom year for coal because of the high request of coal for growing china and the japanese steel mills. There are a few factors to keep in mind when dealing coal. First of all coal is handled with US dollars. And so long the dollar is weak, there is a stagnation in the rise of value of stock. If you anlayze all 4 securities (EXL, MCC, CEY, GCL), they all have been having trouble in the past year. I would define such a behaviour as a correction in price ( as the old Kostolany used to put it).
Of course china has been active in obtaining commodities of its own but IOP it will never be able to obtain sufficient coal for there factories, which are situated in the east. There coal mines are unfortunately situated in the west and transportation to the mills is utterly expensive. Its cheaper for them to ship it out of australia.
I am expecting a stronger US dollar this year which will force the price of oil to stagnate. IOP it is already happening. Paying oil in US dollars means inflation with an expensive greenback. Consequentially commodities like coal will sky-rocket for a while...and then we`ll see...


----------



## michael_selway

excalibur said:
			
		

> 2005 was of course a boom year for coal because of the high request of coal for growing china and the japanese steel mills. There are a few factors to keep in mind when dealing coal. First of all coal is handled with US dollars. And so long the dollar is weak, there is a stagnation in the rise of value of stock. If you anlayze all 4 securities (EXL, MCC, CEY, GCL), they all have been having trouble in the past year. I would define such a behaviour as a correction in price ( as the old Kostolany used to put it).
> Of course china has been active in obtaining commodities of its own but IOP it will never be able to obtain sufficient coal for there factories, which are situated in the east. There coal mines are unfortunately situated in the west and transportation to the mills is utterly expensive. Its cheaper for them to ship it out of australia.
> I am expecting a stronger US dollar this year which will force the price of oil to stagnate. IOP it is already happening. Paying oil in US dollars means inflation with an expensive greenback. Consequentially commodities like coal will sky-rocket for a while...and then we`ll see...




Hey i agree with u, btw what does IOP mean?

Yeah bascially if costs are high as experienced by some of our coalers, then they would naturally demand higher prices. Coal although "dirty" is relatively cheap and still very efficient when compared to crude

Which Coal Stocks do u think will perform better at current prices out of EXL, MCC, CEY, GCL, FLX, RSP, other?

thx

MS


----------



## Smurf1976

michael_selway said:
			
		

> Coal although "dirty" is relatively cheap and still very efficient when compared to crude



This is a non-financial post relating to the above for those who may be interested.

In terms of the end uses, primarily electricity generation, steel production and to a lesser extent cement kilns and factory boilers (eg paper mills), coal isn't particularly "dirty" compared to crude oil in the traditional sense. And traditional steel production is based on coke (from coal) anyway so oil isn't a direct substitute there.

Coal emits approximately 20% more carbon dioxide (greenhouse gas) when used at the same efficiency level in electricity generation (steam turbine plant). But carbon dioxide is a non-conventional pollutant in that it has no local effects in practice.

Conventional pollutants (air pollution) are particulates (visible smoke), oxides of nitrogen, hydrocarbons (unburnt fuel) carbon monoxide (a colourless, odourless toxic gas commonly associated with car exhaust) and sulphur dioxide (acidic gas which causes acid rain). In the context of large scale industrial use with typical (relatively cheap) pollution controls it's only the sulphur dioxide that is relevant unless the local climate results in an accumulation of oxides of nitrogen (leading to smog formation) or there is some ultra-sensitivity on the issue (not likely in China).

Australian coal is generally low in sulphur - hence why there has never been an effort to limit emissions from Australian coal-fired power stations since it's just not a problem in practice. UK (and elsewhere) coal is significantly higher in sulphur content which is the reason for it having caused problems overseas. 

Crude oil also contains very significant amounts of sulphur. Very little of this makes its way through to petrol or diesel (it's removed at the refinery in a rather expensive process - that's why truck emissions are much cleaner now than even 5 years ago). The limits in Australia and other countries for sulphur content in petrol and diesel have been progressively reduced and are at the point now where there's little difference in the overall impact of heavy vehicles (eg buses) running on diesel versus natural gas. Different pollutants but overall not a great difference.

Heavy fuel oil is, however, another matter. It contains typically 1 to 4% sulphur and, outside of Japan, oil-fired power stations generally don't have any controls on sulphur dioxide (SO2) emissions (significant amounts of unrefined crude oil are burned in Japanese power stations in addition to fuel oil). It goes straight up the stack. For example, the then oil-fired (now gas fired) Bell Bay power station in Tasmania emitted more sulphur dioxide than the much larger coal-fired stations in the mainland states. Not more per unit of production, but more in total despite being less than one sixth the size of Hazelwood PS (Vic). No longer an issue but there was sufficient concern for Hydro to do fallout monitoring when the plant was running (infrequently - it's backup to hydro in the event of severe drought or breakdown) and the sulphur issue was a key one in favour of conversion to another fuel when permanent operation was first contemplated (cost being another issue).

EU regulations limit sulphur in fuel oil consumed in power stations to 1%. Some other countries also have similar regulations but only in Japan do oil-fired power stations have effective emissions controls (due to their location in the metro area of major cities). Even with the EU limit, Australian coal is no worse and generally cleaner (even without emission controls). That said, the 4% sulphur fuel is still going somewhere but it sells at a discount to the lower sulphur grades. Australian limits vary somewhat - 0.05% (ridiculously expensive but it's only backup to natural gas to run the plant) from memory at Newport PS (Melbourne metro area) and it was limited to 3% at Bell Bay (typically 2.5% was used in practice). There's crude oil being produced which contains 6% and even 8% sulphur.

At considerable expense (and consumption of limited limestone resources) sulphur emissions can be reduced to very low levels from either coal or oil-fired plant. It's a question of cost (it's no secret that at least one very large UK coal-fired plant switches the SO2 scrubbers off at night...).

Coal-fired power stations also emit significant quantities of other pollutants not mentioned above, likewise oil. Nickel and vanadium are among the more significant ones in the case of oil (vanadium being linked with asthma with health effects having been observed in some countries (notably UK)) and coal emits mercury (in fact it's the largest source worldwide).

Modern ultra-supercritical coal fired plant operates at higher efficiency and produces less of all major pollutants due to less coal being used. Such plants exist in Queensland (only the newest plants) in Australia. Other options are fluidised bed combustion (virtually zero visible emissions even without gas scrubbers) and the big goal is to make integrated combined-cycle gassification (IGCC) viable - literally using the coal as gas with the resultant clean emissions.

In short, Australian coal is clean enough to meet emissions requirements, especially if SO2 scrubbers are used. It's cleaner than oil (likewise coal from some other countries) and vastly cheaper. The exception is greenhouse gas emissions but (waiting to be flamed here   ) I can assure you that the world as a whole is NOT doing anything meaningful to reduce emissions, in fact they will increase. The Kyoto Protocol is a cause of net _increases_ in emissions due to the accelerated economic growth it encourages in non-target (no emissions limits) countries particularly China - a fact that's reasonably well understood. That is, shift manufacturing away from Kyoto countries thus boosting the economy and consumer demand in non-Kyoto countries. 

The coal industry responded to the news that Kyoto was to be ratified by announcing mine and port expansions whilst the nuclear industry was likewise rather happy. More nuclear power in the developed countries, more coal demand in the developing countries and in total. It's more of an economic plan to boost the global (but not developed countries) economy than an environmental agreement. Politics... Worth noting that many countries that are required to meet targets under Kyoto are already well above target emissions and seem unlikely to meet their target levels. They forgot about natural gas depletion with the UK government in particular now acknowledging that coal is part of the future whereas just 2 years ago they absolutely opposed it.


----------



## Market Cap

michael_selway said:
			
		

> Hey i agree with u, btw what does IOP mean?
> 
> 
> Which Coal Stocks do u think will perform better at current prices out of EXL, MCC, CEY, GCL, FLX, RSP, other?




Here's a link to Analyst's recommendation on Coal companies in Australia and elsewhere...

http://www.kitcometals.com/commentaries/Matlack/coal/feb222006.html

Best value Aussie companies appears to be GCL and MCC.


----------



## excalibur

michael_selway said:
			
		

> Hey i agree with u, btw what does IOP mean?
> 
> Yeah bascially if costs are high as experienced by some of our coalers, then they would naturally demand higher prices. Coal although "dirty" is relatively cheap and still very efficient when compared to crude
> 
> Which Coal Stocks do u think will perform better at current prices out of EXL, MCC, CEY, GCL, FLX, RSP, other?
> 
> thx
> 
> MS




Sorry Mike,
With IOP  I meant IMO ( In my opinion) ...was kind of a lapsus.
I am not used to this computer language yet.
Well back to the coal stocks:
I do not want to give any advice, but if you`re dealing with australian securities, then I would keep an eye on GCL. They are in a phase of buying back about 4000000 shares, which isn`t very good news gazing at the speculative side, but they do have stable contracts with Japan and are having an increase in Cash-Flow. The security is interesting because of the 11 ct. dividend that has been payed recently.


----------



## noirua

The position of coal prices has become quite interesting and this concerns the bottom end of the coal market. Thermal and sub-bitumous ( steaming ) coals are mainly used in powerstations and there are vast reserves in South Australia. China has recently announced the intent to build an increasing number of powerstations using sub-bitumous coal.
It does seem that the future is very bright for coal in the 30 years ahead.


----------



## nizar

noirua said:
			
		

> The position of coal prices has become quite interesting and this concerns the bottom end of the coal market. Thermal and sub-bitumous ( steaming ) coals are mainly used in powerstations and there are vast reserves in South Australia. China has recently announced the intent to build an increasing number of powerstations using sub-bitumous coal.
> It does seem that the future is very bright for coal in the 30 years ahead.




yes i agree

i read a report in AFR a few months ago about australia's energy sources...

in 2050, we are still expected to generate 40% of our energy from coal (down from about 50% today)..

EXL the best exposure?


----------



## michael_selway

nizar said:
			
		

> yes i agree
> 
> i read a report in AFR a few months ago about australia's energy sources...
> 
> in 2050, we are still expected to generate 40% of our energy from coal (down from about 50% today)..
> 
> EXL the best exposure?




Hm coal specialists

EXL, MCC, CEY, GCL, FLX, RSP?

any others not too small?

Yeah i like exl the best beacause of their forecast EPS through to 2010 (see half yearly)

Earnings and Dividends Forecast (cents per share) 
2005 2006 2007 2008 
EPS 49.3 48.2 76.0 101.9 
DPS 24.0 24.0 39.0 50.5 

However their Millenium Mine cost blowout has been a problem this yr, hopefully it will be completely fixed up in May 06 as they have said

thx

MS


----------



## Smurf1976

nizar said:
			
		

> yes i agree
> 
> i read a report in AFR a few months ago about australia's energy sources...
> 
> in 2050, we are still expected to generate 40% of our energy from coal (down from about 50% today)..
> 
> EXL the best exposure?



Note that this refers to primary energy and not electricity generated (electricity being the major use of coal). A bit over 80% of Australia's electricity is from coal, about 10% from hydro (60% of that in Tasmania, 30% from the Snowy and the rest in Vic, Qld, NSW and WA) and most of the rest is from natural gas. A minor amount is from oil both to supply the major grids and in remote areas (diesel) and also wind and bagasse (sugar industry waste) are minor sources. Trivial sources include solar and landfill gas.

In terms of primary energy regardless of the end use, coal and oil dominate with most of the rest from gas. Hydro is minor in this context partly because of conversion efficiency and what's being measured. In the case of hydro (and wind, solar etc) it's the output of the power stations (themselves over 90% efficient in the case of hydro) which is measured whereas with coal it's the input (60%+ of which is lost in conversion to electricity) which is measured. So the minor sources (hydro etc) are more important than primary energy stats indicate but they are still relatively minor compared to coal, oil and gas. Wood makes up most of the rest with a bit from wind and trivial amounts from solar etc.


----------



## michael_selway

Smurf1976 said:
			
		

> Note that this refers to primary energy and not electricity generated (electricity being the major use of coal). A bit over 80% of Australia's electricity is from coal, about 10% from hydro (60% of that in Tasmania, 30% from the Snowy and the rest in Vic, Qld, NSW and WA) and most of the rest is from natural gas. A minor amount is from oil both to supply the major grids and in remote areas (diesel) and also wind and bagasse (sugar industry waste) are minor sources. Trivial sources include solar and landfill gas.
> 
> In terms of primary energy regardless of the end use, coal and oil dominate with most of the rest from gas. Hydro is minor in this context partly because of conversion efficiency and what's being measured. In the case of hydro (and wind, solar etc) it's the output of the power stations (themselves over 90% efficient in the case of hydro) which is measured whereas with coal it's the input (60%+ of which is lost in conversion to electricity) which is measured. So the minor sources (hydro etc) are more important than primary energy stats indicate but they are still relatively minor compared to coal, oil and gas. Wood makes up most of the rest with a bit from wind and trivial amounts from solar etc.




Hi Smurf, whats yoru preference for the below coal specialists?

EXL, MCC, CEY, GCL, FLX, RSP?

thanks

MS


----------



## michael_selway

BentRod said:
			
		

> Smurf,
> You seem to know your stuff!
> 
> Any thought's on GDY?
> 
> Is geothermal energy viable in your opinion?
> 
> Michael,
> Sorry to go off topic slightly.
> 
> Cheers




Hi its cool

Btw anyone notice a new ARA index for coal?

http://www.globalcoal.com


----------



## noirua

Coal is still a major part of power for the distant future as new technological power stations come to the fore. Clean coal is the way forward for power over the next thousand years. South Australia has enough sub-bitumous coals to power Australia for the next 10 thousand years.

http://www.draxpower.com/about.php

http://www.draxpower.com/about.php?page=fun

http://www.draxpower.com/about.php?page=intro

http://www.draxpower.com/environment.php

http://www.draxpower.com/community.php


----------



## RichKid

This is a feature article about producing 'clean' coal through separating CO2 and then disposing of it safely, I think the issue has been mentioned before by Smurf and others. Can this really be so good? Will it work? 300 yrs of coal is a helluva lot!! I can see why it's in the national interest to harness it if you can take the negatives out of it.
http://www.theaustralian.news.com.au/story/0,20876,19398445-28737,00.html

An extract:

...........Together with proposed private industry spending, investment in clean coal technology in Australia alone is expected to tip $20 billion in the next decade.

The reason for this massive investment is that Australia has about 300 years' worth of coal still in the ground and fossil fuels comprise a quarter of all exports. Australia also has 24 large power stations that burn more than 250,000 tonnes of coal every day to supply what is among the cheapest electricity in the Western world. The downside is every station releases thousands of tonnes of carbon dioxide into the atmosphere.

The federal Government has gone a long way to support the coal industry, risking international opprobrium by refusing to sign the Kyoto protocol - a treaty that seeks to reduce greenhouse gas emissions by putting a price on carbon dioxide. ................


----------



## Smurf1976

A few points on that article...

1. The power station where the carbon capture project is planned is the Callide A station in Queensland. This is a relatively small (120 MW) plant which consists of 4x30MW units all black coal-fired. The plan is to fit the technology to one of those units as a trial. The other Callide power stations are not involved at this stage.

As a relatively high cost plant in a well supplied market (Queensland being the only state in that position) Callide A is idle at present. Production from the plant with carbon capture is primarily to test and demonstrate the technology although running one 30 MW unit constantly would, after allowing for maintenance, generate about 0.5% of Queensland's electricity or 0.1% of national electricity. As I said, the point is to demonstrate the technology rather than achieve large scale emissions reductions at this stage.

If successful, there is no reason (apart from cost) why the technology could not be fitted to other Australian power stations within reasonably close distance of somewhere suitable to store the carbon. The brown coal power stations in the Latrobe Valley (Vic) are the most obvious place to start given their close proximity to depleted offshore oil and gas fields and baseload (constant 24/7) operation although there are plenty of opportunities elsewhere too.

From a practical perspective, it wouldn't be possible to take more than one large generating unit in each state offline at a time and the conversion would likely take a year or two for each unit. (The time is speculation at this stage however since it's untested in practice.) So over a number of years it would be possible to gradually convert existing power stations to a zero-emissions operation doing it one unit at a time.

Given the need to reduce oil and gas use for power generation as other demands for those fuels increase and supplies tighten, it's just dreaming to think that coal is about to disappear as a power source in Australia or internationally. Coal generates about 40% of world electricity now whilst there is a need to replace much of the combined 42% from oil, gas and ageing nuclear plants. Only the 18% that is renewable (mostly hydro) is sustainable without rebuilding and non-carbon emitting in ongoing operation. So, in total, 82% of the world's electricity is from sources that are running out (oil and gas), emit lots of carbon (coal) or are in most cases ageing (nuclear). A huge demand for new capacity in the next 50 years that renewables alone simply will not, can not, meet. So coal and/or nuclear MUST have a future at least for the next half century - a point that even many conservationists acknowledge despite their concerns over the impacts.

2. Regarding the photo of Hazelwood power station in the article, it is somewhat misleading IMO. The visible emissions from the stacks are NOT greenhouse gasses (carbon dioxide is invisible to the human eye). It is mostly condensed water vapour (literally steam) due to the roughly two thirds water content in the coal from the Morwell mine burnt at the plant. The remaining visible emissions are fine ash particles which are now almost completely removed (so it looks like an old photo circa 1970's).

I have my own photos of the plant with 4 units running and 4 offline. I'll scan and post it if I can get access to a scanner and I challenge anyone to tell me which units are idle and which are active in the photo. Clear blue sky is all you'll see. Point here being don't believe the media when they show pictures of polluting industry - carbon dioxide is invisible. If the media is showing pictures of it then you're looking at steam or particles, not carbon dioxide.


----------



## noirua

RichKid said:
			
		

> This is a feature article about producing 'clean' coal through separating CO2 and then disposing of it safely, I think the issue has been mentioned before by Smurf and others. Can this really be so good? Will it work? 300 yrs of coal is a helluva lot!! I can see why it's in the national interest to harness it if you can take the negatives out of it.
> http://www.theaustralian.news.com.au/story/0,20876,19398445-28737,00.html
> 
> An extract:
> 
> ...........Together with proposed private industry spending, investment in clean coal technology in Australia alone is expected to tip $20 billion in the next decade.
> 
> The reason for this massive investment is that Australia has about 300 years' worth of coal still in the ground and fossil fuels comprise a quarter of all exports. Australia also has 24 large power stations that burn more than 250,000 tonnes of coal every day to supply what is among the cheapest electricity in the Western world. The downside is every station releases thousands of tonnes of carbon dioxide into the atmosphere.
> 
> The federal Government has gone a long way to support the coal industry, risking international opprobrium by refusing to sign the Kyoto protocol - a treaty that seeks to reduce greenhouse gas emissions by putting a price on carbon dioxide. ................




The efforts by Gail ( India ) Ltd to build an underground coal or lignite Gasification Plants looks to be another way forward.  http://www.thehindubusinessline.com/2006/02/18/stories/2006021803170200.htm


----------



## michael_selway

noirua said:
			
		

> The efforts by Gail ( India ) Ltd to build an underground coal or lignite Gasification Plants looks to be another way forward.  http://www.thehindubusinessline.com/2006/02/18/stories/2006021803170200.htm




All of them up today as EXL merger

MCC, CEY, GCL, but not FLX and CNA

thx

MS


----------



## noirua

michael_selway said:
			
		

> All of them up today as EXL merger
> 
> MCC, CEY, GCL, but not FLX and CNA
> 
> thx
> 
> MS





It looks like a recovery period for coal stocks as confidence rises. Even ordinary thermal coal should stay above US$50 per tonne and steaming coal, at the bottom end, is getting good reviews on pricing. Even FLX and CNA should recover quickly to well above recent lows.


----------



## noirua

Thermal Coal prices are set to increase in the next round of price agreements. Check the coal stocks and work out their production, production costs and likely increase in profits, as many are now forgotten. 

China still rules on demand:  http://au.biz.yahoo.com/070119/19/125j6.html

Uranium, Gold, nickel, Tin...don't forget Thermal Coal.


----------



## michael_selway

noirua said:
			
		

> Thermal Coal prices are set to increase in the next round of price agreements. Check the coal stocks and work out their production, production costs and likely increase in profits, as many are now forgotten.
> 
> China still rules on demand:  http://au.biz.yahoo.com/070119/19/125j6.html
> 
> Uranium, Gold, nickel, Tin...don't forget Thermal Coal.




Hi, at current prices, which coal stocks u like best? CEY, GCL, FLX, CNA, RSP, any others?

http://www.globalcoal.com

*NEWC Index 
Oct-2006 42.59  
Nov-2006 42.36  
Dec-2006 50.99  
Jan-2007 51. * 

thx

MS


----------



## Garpal Gumnut

noirua said:
			
		

> Thermal Coal prices are set to increase in the next round of price agreements. Check the coal stocks and work out their production, production costs and likely increase in profits, as many are now forgotten.
> 
> China still rules on demand:  http://au.biz.yahoo.com/070119/19/125j6.html
> 
> Uranium, Gold, nickel, Tin...don't forget Thermal Coal.




Dear Noirua,

Which are the specialty thermal stocks? I just use BHP, RIO as an entry to coal which probably dilutes any movements in prices for me as they are into so many other resources.

Garpal


----------



## Smurf1976

> In December, Xinhua news agency reported that China's coal use was likely to increase to 2.5 billion tonnes in 2007. Government data gives 2005 coal consumption at 2.2 billion tonnes



Each year the _increase_ in Chinese coal consumption is far greater than the total amount that Australia uses. A point of major significance to both the coal market and the climate change debate.


----------



## noirua

Garpal Gumnut said:
			
		

> Dear Noirua,
> 
> Which are the specialty thermal stocks? I just use BHP, RIO as an entry to coal which probably dilutes any movements in prices for me as they are into so many other resources.
> 
> Garpal




Hi, making profits on coal production can be very hard work, note the Radio Report yesterday my CEY. There is a need to do a lot of research on what types of coal a company has at each mine and the costs versus position of the mine. Longwall mining can present many problems.

It will be a while yet before the new coal loader is commissioned at Newcastle. Seventy ships are reported to be at anchor waiting. Demurrage costs are racking up.

Many, including Peabody, Xstrata and Felix Resources, are waiting go-aheads on thermal coal mines in NSW. These would be combined with the new port extension at Newcastle that also awaits a go-ahead. 

Companies like MCC and CEY, are beset with problems, and may come good  if they manage to overcome these. FLX mines mostly thermal coal, but is treble the price it was less than 12 months ago and there is a gamble factor concerning the extension of the Newcastle port and the Moolarben go-ahead. Coal and Allied are the largest Aussie in the thermal coal sector; Like FLX their key assets are in the Hunter Valley via Newcastle.

A long answer in what remains a quite risky sector. 

An interesting link:  http://www.iht.com/articles/2007/01/11/bloomberg/sxasia.php


----------



## michael_selway

noirua said:
			
		

> Hi, making profits on coal production can be very hard work, note the Radio Report yesterday my CEY. There is a need to do a lot of research on what types of coal a company has at each mine and the costs versus position of the mine. Longwall mining can present many problems.
> 
> It will be a while yet before the new coal loader is commissioned at Newcastle. Seventy ships are reported to be at anchor waiting. Demurrage costs are racking up.
> 
> Many, including Peabody, Xstrata and Felix Resources, are waiting go-aheads on thermal coal mines in NSW. These would be combined with the new port extension at Newcastle that also awaits a go-ahead.
> 
> Companies like MCC and CEY, are beset with problems, and may come good  if they manage to overcome these. FLX mines mostly thermal coal, but is treble the price it was less than 12 months ago and there is a gamble factor concerning the extension of the Newcastle port and the Moolarben go-ahead. Coal and Allied are the largest Aussie in the thermal coal sector; Like FLX their key assets are in the Hunter Valley via Newcastle.
> 
> A long answer in what remains a quite risky sector.
> 
> An interesting link:  http://www.iht.com/articles/2007/01/11/bloomberg/sxasia.php




yeah i liek CEY at current prices, if it does well it can very well

*Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 17.5 13.8 22.1 32.0 
DPS 13.0 13.0 11.0 13.0 

EPS(c) PE Growth 
Year Ending 30-06-07 13.8 19.6 -21.3% 
Year Ending 30-06-08 22.1 12.2 60.1% * 

thx

MS


----------



## noirua

Coal - Environment report " solid energy "

http://img.scoop.co.nz/media/pdfs/0702/Environment_Report._web.pdf


----------



## noirua

Following on from the "solid Energy Report" from NZ (post 39) . We have an article from 2005 that shows plans for a Coal Fired Non-Polluting Power station:  http://www.dw-world.de/dw/article/0,2144,2035398,00.html


----------



## noirua

Coal is one of Australia's major exports and companies are increasingly embracing new tecnology. The Gladstone Centre for Clean Coal is one of these:  http://www.gc3.cqu.edu.au/

Clean coal is important as it is a major power source for now and well into the future:  http://www.gc3.cqu.edu.au/burn-coal-cleanly/index.php


----------



## Smurf1976

noirua said:
			
		

> Coal - Environment report " solid energy "
> 
> http://img.scoop.co.nz/media/pdfs/0702/Environment_Report._web.pdf



For those not aware, Solid Energy is a government owned coal mining company in NZ. 

For quite some time Solid Energy has been interested in developing brown coal-fired power generation in NZ as natural gas reserves in that country are depleted (natural gas provides over a quarter of NZ electricity). 

That said, another NZ company, Mighty River Power (predominantly involved with hydro-electricity as the name implies) has dropped plans to convert an "old" (built in the 1970's but has never generated as single kilowatt - not even a trial run) oil-fired plant to coal-firing on the basis that renewable energy, specifically geothermal, is a cheaper option than coal. That plant isn't near coal mines however so it did have transport cost issues (and would likely have used imported coal).


----------



## noirua

The Australian Government, a report goes to Mr Howard in May, should point out how New Technology and Brown Coal is the way forward in Australia:  http://www.theaustralian.news.com.au/story/0,20867,21365418-5005200,00.html


----------



## noirua

Coal prices remain on the up in US Dollar terms and that particularly concerns prices of export thermal coals, PCI coal and semi-soft coking. The rise in the Aussie Dollar to around A$1.15 to the US$ is starting to squeeze profit margins on those who have fixed prices and have failed to take currency options. Demurrage costs and the problems at Newcastle Dock in particular remain negative factors.

Those who are able to make up short falls in NSW Docks by supplying at US$58+ a tonne for thermal are doing well.

The futures bright for thermal and indeed the futures coal.


----------



## noirua

A link from a few months back that shows the interest for thermal coal use in Power Stations in China. The contract price is usually more settled.
http://www.kalenergyinc.com/investors/reports/everybody_loves_coal_2007_05_31.pdf


----------



## noirua

This Bloomberg article shows how the mildly bullish tone for thermal coal has turned very bullish. Thermal coal looks to be "King Coal" for at least the next two years. Spot thermal coal is set to rise on the back of heavy rain in Indonesia.

http://www.bloomberg.com/apps/news?pid=20601087&sid=axTy1Kg5XA7M&refer=home


----------



## noirua

Thermal, PCI and semi-soft coking coal has risen by up to 22%, on spot, out of Newcastle and Gladstone. 
Xstrata and Rio have started their current round of talks that are expected to agree supplies from 1st April 2008 at around US$68 per tonne for thermal and up to US$76 for semi-soft.


----------



## noirua

At the moment thermal coal production will grow and supply will still not match demand. Two or three thermal coal powerstations are opened every month in China alone.


----------



## michael_selway

noirua said:


> At the moment thermal coal production will grow and supply will still not match demand. Two or three thermal coal powerstations are opened every month in China alone.




Yes you need to load up on coal! CEY, GCL, FLX, MCC, RSP etc







Thanks

MS


----------



## Aussiejeff

From Agence France-Presse today..


_"ENERGY-starved China will boost coal output by 400 million tonnes a year by 2010 by streamlining the industry and opening a string of new "super" pits, state media reported today.

Widespread closures and mergers will leave fewer than 20 firms, including six to eight new “super coal production enterprises' with a yield of 100 million tonnes each, accounting for more than 50 per cent of the country's entire output by 2010, Xinhua news agency said.

China reported a total coal output of more than 2.3 billion tonnes of coal last year.

Small mines that are illegal or inefficient and have given the industry its appalling safety record are already being weeded out, Wang Xianzheng, deputy director of the State Administration of Work Safety, was quoted as saying.

Over the past two years, more than 9000 small mines have been shut and another 1000 will close by the end of 2007, Xinhua said.

As part of the streamlining process the country plans to build 10 large strip-mines with a production capacity of 10 million tonnes each and another 10 pits with a yield of 10 million tonnes each, Mr Wang said.

China's coal mines are among the most dangerous in the world, and many of the accidents occur in small, unlicensed mines where safety regulations are widely ignored.

More than 4700 coal miners died in China last year, according to official figures, but independent labour groups put the real toll at closer to 20,000 annually. They say many accidents never come to light."_

I wonder what effect this move by China might have on our own coal exporters over the coming years.. let alone the possible impact on climate change?

AJ


----------



## noirua

The position of coal, in supplying China, India and the rest of Asia is a very talked about subject.
China are opening 2 or 3 power stations every week and by far the majority are powered by thermal coal mixes. Thermal coal is cheap when compared with oil.
There is new technology, mainly from Germany, but this will take time and China are not prepared to wait.

Indonesia produces a lot of thermal coal but is needing an increasing amount for its own new power stations.

Australia has vast amounts of thermal coal and sub-bitumous coal. The latter is coming more to the fore in South Australia with the Adelaide to Darwin Rail Link in place. Ports are being enlarged and new loaders added.

Apart from these coals, it's lignite that holds a further key as new technology becomes available. There is more lignite in the world than all other coals put together.

The future is coal, unfortunately Asia is going to become a very smokey place. The upsides are enormous and the downsides very obvious.


----------



## noirua

The Newcastle Port became the embarrassment of Australia as 70 ships lay at anchor waiting to berth.
There has been some improvement and the present number of ships at anchor is 39, with 4 in port. 
Delay is currently 16.5 days.


----------



## noirua

Coal blending process before shipping out of the R.G. Tanna Coal Terminal, Port of Gladstone, Queensland:  http://www.jellinbah.com.au/LibraryFiles/RGTCT Blending Brochure 2003 04.pdf


----------



## nioka

The "Coldry" process for treating brown coal, patented by ESI, has the potential to be used in the process of extraction of diesel from brown coal at costs which could be profitable at oil prices above $60 barrel.
 In an ASX announcement ESI claim that using the Coldry process which extracts 95% of the water from brown coal to produce a dense and energy rich fuel pellet could be extended to coal to oil applications. Research indicates Coldry pellets have a higher yield per tonne than black coal and eliminate the need for costly energy intensive and high-emissions slurry drying associated with black coal.
For further information check out yesterdays ESI announcement.


----------



## Smurf1976

I'm no expert on Chinese coal reserves, but I did see some research which suggested they would hit peak production around 2020. 

If it's correct then given the huge number of new power stations they are building, world coal trade is set to surge once China's produciton peaks.


----------



## ithatheekret

I was under the impression that coking coal is the vareity in highest demand , given the abundance of coal available . I can only see it continuing with strong demand , much to the disgust to the well meaning greenies , money may make the world go round , but it's basically powered by coal for our other needs , this is not a fleeting coincidence as most of the globes major exporters and utilities  , need this fuel source for the continuity in manufacturing and other fundamental needs to power players who are scraping the barrel to find a way to reduce operation costs .


----------



## noirua

Green footprints are all very fine but how many back these principals to the extent of reducing their brown footprint:  Sell the car, walk further, don't buy packaged products, never fly by aircraft except gliders. Infact, buy  pedal cycles for the family and they can use it to cycle 10 kilometres to school and back. Use one carrier bag and never use plastic throw-away ones. Cut down on heating and remove the airconditioning and so it goes on and on.

When you go on green rallies, NEVER TRAVEL BY CAR. Show you mean what you say and use a pedal cycle, WHAT, it's 50 kilometres, so what, are you really the genuine article. YOU ARE, great, I respect you.


----------



## trueblue

michael_selway said:


> Yes you need to load up on coal! CEY, GCL, FLX, MCC, RSP etc
> 
> 
> 
> 
> 
> 
> Thanks
> 
> MS




Add COK to your list. Up and coming coal company.


----------



## michael_selway

trueblue said:


> Add COK to your list. Up and coming coal company.




Yep not a problem

CEY, FLX, GCL, MCC, (RSP-NHC), WHC, CNA, AQA, RIV, COK, MLM, NEC...







Do you know any other?

Thanks

MS


----------



## imajica

WHC released an exceptional presentation regarding their growth prospects this morning!

makes for a very encouraging and reassuring read for WHC holders!


----------



## noirua

Coal prices are set to remain at high levels during 2008 with all the port problems in Australia and  benchmark thermal coal out of Newcastle may well reach US$90 per tonne.

Prices for those miners who are yet to agree deals from April 2008 onwards, may well set benchmark thermal prices at around US$90 per tonne. 

Prices for coking coal may well be set to lift with increasing demand from India and other coals, semi-soft coking, P.C.I., and even sub-bitumous, are set to rise further.


----------



## Nick Radge

Nice breakout of a descending triangle in CEY yesterday:







_This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision._


----------



## michael_selway

Nick Radge said:


> Nice breakout of a descending triangle in CEY yesterday:
> 
> 
> 
> 
> 
> 
> _This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision._




Hm you were right about CEY

Do you have any TA thoughts on any of the other coal stocks?

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CNA, SRL, MLM...*

thx

MS


----------



## ithatheekret

I like this thread , clinical thinkers with eyes on the ball  , couple of others for the list ...... Excel and Pike River Coal .


----------



## michael_selway

ithatheekret said:


> I like this thread , clinical thinkers with eyes on the ball  , couple of others for the list ...... Excel and Pike River Coal .




Hi you meantion "Excel" isthat listed onthe ASX? I thought it was taken over by Peabody Coal, a US company

Thanks

MS

--------------------------------------------

PS: Any others i can add to the list below? Thanks

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CNA, SRL, MLM, PRC...*


----------



## noirua

The IMF forecasts World economy growth at 4.75% for 2008. This is against an expected figure of 5.2% in 2007 and actual growth of 5.4% in 2006. The sag is due to reduced growth expected in the USA, UK and parts of Europe.

World coal sales are expected to rise by 35 million tonnes in 2008. Coal prices are expected to remain firm during 2008 in Australia due to Port restrictions. 2009 will start firm but prices are not expected to rise above the 2008 average as Port upgrades and a new terminal at Newcastle comes onstream.
2010 may well be a testing period in Australia for thermal coal.


----------



## noirua

For some with coal and no where to go it really is a case of "where to now?":

"No unallocated QLD or NSW coal port capacity until 2012; all of the planned expansions at Dalrymple, Gladstone, Newcastle, already committed."

http://electricityweekqld.wordpress...rymple-gladstone-newcastle-already-committed/


----------



## noirua

Back in 2005, China announced they would need to build 544 new coal fired Power Stations to power cities. From a BBC report in March 2005: http://news.bbc.co.uk/2/hi/programmes/newsnight/4330469.stm


----------



## ithatheekret

michael_selway said:


> Hi you meantion "Excel" isthat listed onthe ASX? I thought it was taken over by Peabody Coal, a US company
> 
> Thanks
> 
> MS




No ....... thank you Micheal , your diligence is correct , I just have to update my lists , all my fault , too busy in other areas .


----------



## noirua

Headline news from Global Coal:  http://www.globalcoal.com/news/coalnews.cfm


----------



## michael_selway

ithatheekret said:


> No ....... thank you Micheal , your diligence is correct , I just have to update my lists , all my fault , too busy in other areas .




No Problemo

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CNA, SRL, MLM, PRC, CZA...*

Updated List

thx

MS


----------



## ithatheekret

There's a new ETF coming out on Tuesday . (KOL)

A market vector coal ETF .

It will cover a basket of US and international coalers .

Just another way to obtain exposure to the coal rush .


----------



## michael_selway

ithatheekret said:


> There's a new ETF coming out on Tuesday . (KOL)
> 
> A market vector coal ETF .
> 
> It will cover a basket of US and international coalers .
> 
> Just another way to obtain exposure to the coal rush .




hi cool thx

Btw updated Coalers list

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CZA, PRC, CDS, CNA, SRL, MLM...*

thx

MS


----------



## noirua

"New South Wales appoints Greiner to help Coal Exports":  http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aeByRK6Kl1hM


----------



## noirua

"China coal shortage to continue":  http://compareshares.com.au/show_news.php?id=451704


----------



## noirua

China suspends coal exports for two months. Swap Benchmark coal out of Newcastle rockets:  http://www.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUSSYD2450820080125


----------



## Nick Radge

deja vu Michael. Another breakout...







_
This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision._


----------



## Smurf1976

noirua said:


> Back in 2005, China announced they would need to build 544 new coal fired Power Stations to power cities. From a BBC report in March 2005: http://news.bbc.co.uk/2/hi/programmes/newsnight/4330469.stm



Building power stations is one thing. Having enough coal to fire them is another.

China's situation with coal now is little different to that which normally applies with hydro power. Easy to add more generating capacity (turbines, alternators) but total output is limited by the availability of primary energy (fuel) to run them. Building another power station in this situation doesn't help if you don't also increase the supply of primary energy with which to run it. 

It's a new situation for China and indeed most countries but one that's very familiar to New Zealand, parts of South America, Canada, Tasmania and other places that have a long established constraint with primary energy rather than peak generating capacity.

Bottom line: China will be flat out doing whatever they can to get more coal and indeed any primary energy (gas, hydro, nuclear, wind) that's cheaper than the fuel of last resort (ie oil). Imports, domestic production, whatever as long as it's cheaper than oil (which coal is).

The US is also facing a reduction in nuclear output due to drought. Again it's not simply a question of peak capacity but one of primary energy. The lost nuclear output, if it happens, has to be replaced by something else. Realistically that's going to be coal and oil - gas is already tapped out and overloading hydro plants in a drought dosen't work for long.

So, China wants more coal and the US will probably have a bit less to export.


----------



## noirua

There we goes Smurf1976, all plans of mice and men. Anyway, China as a form of Dictatorship, just says "we are not exporting any coal for 2 months" and that is that, no more to be said.
As you infer, China has had to shutdown some powerstations due to lack of coal. 
A great pity Australia didn't update the rail system back in 2003 and ports when PM John Howard had such a great chance.  Instead they built the Alice Springs to Darwin rail extension (great enterprise), not a lot of use in Queensland and NSW however.


----------



## noirua

Peabody, ARCH, U.S. Coal Miners Rise on Higher Prices:  http://www.bloomberg.com/apps/news?pid=20601087&sid=atY6mQ6kyEhA&refer=home


----------



## ithatheekret

5.48 days supply in China , power crisis , govt. bans on further exporting during crisis . 

Anyone else think this is a positive for coal stocks ?


----------



## Nick Radge

ithatheekret,
I only have one position on at present, CEY, so here's hoping!


----------



## ithatheekret

Hi Nick ,

Your pulling my leg aren't ya Nick ?  :


My bet is your laughing all the way to the bank , $1.88 cap ret. and the price is back there already , yeeehaaa .

Yeah yep and yup and I have MCC too  ...............

Who said there's no such thing as money trees ? We just have to keep Marius Kloppers at bay


----------



## Smurf1976

Does anyone have info on what's happening with the domestic, as opposed to export, price of coal in NSW at the moment? I'm assuming there would be a significant gap between export and domestic prices given the port constraints.


----------



## michael_selway

ithatheekret said:


> Hi Nick ,
> 
> Your pulling my leg aren't ya Nick ?  :
> 
> 
> My bet is your laughing all the way to the bank , $1.88 cap ret. and the price is back there already , yeeehaaa .
> 
> Yeah yep and yup and I have MCC too  ...............
> 
> Who said there's no such thing as money trees ? We just have to keep Marius Kloppers at bay




yep not bad MCC!

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 27.6 21.9 86.3 115.6 
DPS 18.0 13.8 43.5 57.8 *

thx

MS

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CZA, PRC, CDS, CNA, SRL, MLM...*


----------



## ithatheekret

Micheal you may like value stocks , the US listed DRYS is trading about 9 X and around 4.5 fut earns . Discount to its peers in sector , thought I'd get it out before CNBC ruin a good thing ...........

DRY BULK

PS ... Peers are trading between 10 to 22 X


----------



## noirua

"Disruptions force up coal and iron ore prices":  http://www.theaustralian.news.com.au/story/0,25197,23123690-5005200,00.html


----------



## ithatheekret

Hoping still Nick , ya razz .

Hope , you don't hope your a pro , hope is an emotion , I get them usually after I've entered a stock before a US opening , but they're call sphincter reactions until I've hit sell or the stocks has reached my limit . 

MCC today for Micheal a bluey and change for a good day mate , I'm smiling .

Looking for a strong close .

PS , Im in line for some ABB too , dif area I know .


----------



## Nick Radge

I had my profit target set at $3.58 and missed by 5c (100% measured move out of the flag). We had a saying on the trading floor, 'don't be a dick for a tick' which basically means be happy with what you got!

Emotion...errr...I did back off 1/2 the position to take profits at $3.90 on the open. You got me all excited...and now I've been let down. There is always tomorrow I guess.


----------



## ithatheekret

Do you trade FX Nick ? I reckon you'd be a whizz at it , if you've been on the trading floor you should be able to smell emotion and sentiment changes in a markets mood .


----------



## agro

any thoughts on AOE - arrow energy?


----------



## Nick Radge

'Plan the trade, trade the plan'  Out at my target. I'm now 100% square.


----------



## ithatheekret

'Plan the trade, trade the plan' Out at my target.


and now probably draining the Eumundi Brewery 

Good on ya Razz , I mean Nick ,


I did move some off the board , but it was to line up on ABB ( which get's hit hard some days ) , I might game the rest to see if it can waltz into the $5 range , that would be very nice indeed . The swings in the market are huge on some stocks , although the volumes are feeling slower , haven't taken any official count yet . 

You'd have a better idea on that than me .

Been in and out for a lark on IPL twice and it's had b. all volume , still have holding though . I even grabbed more ORI  , whilst they are not huge buyings , they have been helped by the goldies rise , which I sold , and will probably kick myself for , I'm now in an a position where I feel I have too much cash on the side and it's useless sitting still to me at present , it certainly doesn't have the patience to wait a year . So I have placed a ridiculous entry point for a small parcel of ASX , which in this climate I might actually get . I will be putting a bid in for some more CEY too , by the looks the goldies position left , they're definitely back on the agenda on the next dip , if we get another one ..........


Noted your comment in another thread , showed the missus and it got the same reaction I had      might have to borrow that one .

Don't hang anything out in the sun though , it will fade , read the label first , especially if it's made in China .


----------



## agro

looks as though the most performing sector on a bull run includes the resource stocks but more specifically iron ore and coal (used in steel)

both these two commodities are being mentioned continually in the AFR and are expected to rise 10 fold..

does that make coal stocks atm under valued?

not to mention the floods in QLD atm! extreme shortage


----------



## michael_selway

agro said:


> looks as though the most performing sector on a bull run includes the resource stocks but more specifically iron ore and coal (used in steel)
> 
> both these two commodities are being mentioned continually in the AFR and are expected to rise 10 fold..
> 
> does that make coal stocks atm under valued?
> 
> not to mention the floods in QLD atm! extreme shortage




Really? 10 fold for both iron & coal? any links?






thx

MS


----------



## agro

michael_selway said:


> Really? 10 fold for both iron & coal? any links?
> 
> 
> 
> 
> 
> 
> thx
> 
> MS




http://news.theage.com.au/china-coal-shortage-to-continue/20080116-1m7u.html

http://merimbula.yourguide.com.au/n...pot-the-boom-as-coal-price-soars/1169417.html

http://www.australiancoal.com.au/newsarchive05.htm

that's all the links i can find ... most the info is in the AFR,


----------



## bigt

Do any coalers have an opinion on CES? They are performing due dilligence currently on a producing coal mine,and have several other promising tenements.

This should provide cash flow for them if the acquisition proceeds. 

They have a tiny mc of $3m, and the chart looks terrible, though looks to have bottomed. Recently announced purchase of 4 iron ore exploration companies in Indonesia, who hold land containing "bedded iron deposits".

$1.7 m cash.

Options expire late 09, exercise 20c, currently 2.5c. SP at 10c, though has been significantly higher during past year (like most other speccies I guess).

Thoughts on whether this could go for a run based on iron acquisition and / or coal mine purchase?


----------



## michael_selway

bigt said:


> Do any coalers have an opinion on CES? They are performing due dilligence currently on a producing coal mine,and have several other promising tenements.
> 
> This should provide cash flow for them if the acquisition proceeds.
> 
> They have a tiny mc of $3m, and the chart looks terrible, though looks to have bottomed. Recently announced purchase of 4 iron ore exploration companies in Indonesia, who hold land containing "bedded iron deposits".
> 
> $1.7 m cash.
> 
> Options expire late 09, exercise 20c, currently 2.5c. SP at 10c, though has been significantly higher during past year (like most other speccies I guess).
> 
> Thoughts on whether this could go for a run based on iron acquisition and / or coal mine purchase?




Hm interesting, never heard of thsi company before!

*Coal Fe Resources Limited was incorporated on 28th September, 2006. The Company was formed with a Vision to be a reliable and dependable Indonesian Mineral Producer by the year 2008. Its Mission is to acquire rights to coal, iron and other mineral projects, explore those projects and, based on successful exploration results and economic conditions, develop those projects to produce and sell those minerals. The Company will also consider new acquisitions. *

thx

MS


----------



## noirua

Comments on the recent coal price rise "Macarthur, Centennial and Felix Resources mentioned":  http://www.tradingmarkets.com/.site/news/Stock News/1085229/?hcode=related&news


----------



## Joshua_Steph

Coal will keep on increasing due to china's export banned..


----------



## noirua

"Newcastle coal rises to Record":  http://www.bloomberg.com/apps/news?pid=20601087&sid=ald__YXFuFs0&refer=home


----------



## Joshua_Steph

Coal price is supposed to keep increasing in the coming weeks. But keep vigilant... while the situation back to normal, price may fall..

Safetrading,
www.SafeStocktradingSecrets.com


----------



## michael_selway

Joshua_Steph said:


> Coal price is supposed to keep increasing in the coming weeks. But keep vigilant... while the situation back to normal, price may fall..
> 
> Safetrading,
> www.SafeStocktradingSecrets.com




Hi Josh are you bearish on coal atm? also if so, is it only short term or maybe long term?

thx

MS


----------



## noirua

"Coal markets rocked by Eskom's ambitous plans":  http://www.businessday.co.za/articles/topstories.aspx?ID=BD4A708446


----------



## theasxgorilla

Joshua_Steph said:


> Coal price is supposed to keep increasing in the coming weeks. But keep vigilant... while the situation back to normal, price may fall..
> 
> Safetrading,
> www.SafeStocktradingSecrets.com




Hi Joshua, could you be so kind as to substantiate this idea with some further information?

ASX.G


----------



## noirua

"China orders State coal mines to increase production":  http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aez.KpWt13_k


----------



## imaginator

Guys,

COAL will increase in price about $300 above current levels. My friend working in the commodity sector says lots of reports and forecasts saying that.

WHat are the few coal stocks you can think of? I bought Cockatoo Coals(COK) last week. I think CEY is doing very well too.


----------



## michael_selway

imaginator said:


> Guys,
> 
> COAL will increase in price about $300 above current levels. My friend working in the commodity sector says lots of reports and forecasts saying that.
> 
> What are the few coal stocks you can think of? I bought Cockatoo Coals(COK) last week. I think CEY is doing very well too.




Hi have you got any links and also what time frame?

CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CZA, PRC, CDS, CNA, SRL, MLM, CES...









> Date: 11/2/2008
> Author: Stephen Wisenthal
> Source: The Australian Financial Review --- Page: 19
> Record prices for Australian coal have resulted from recent floods in Queenslandand the Chinese snowstorms. These short-term issues are balanced by longer termissues of increasing demand and improving transport infrastructure. The highprices have pushed the GlobalCoal index to a record $US125.48 on 8 February2008. Australian coal companies are attractive investments due to the high coalprice, with particular attention on Macarthur Coal, Centennial Coal and FelixResources. The coal industry is more resilient than other resource stocks due tothe continuing demand for heating fuels


----------



## Smurf1976

Does anyone know what's happening with Australian domestic (as opposed to export) coal prices? I'm assuming they are lower than export given the shipping constraints etc.


----------



## noirua

Outlook 2008: Why Coal - The World's Forgotten Fossil Fuel - is About to Double in Price:  http:www.moneymorning.com/2008/02/14/out...tten-fossil-fuel-is-about-to-double-in-price/


----------



## imajica

I'm really glad I bought into AQA a few months back - established diversified producers , especially those with both coal and iron ore exposure will kick ass in 2008


----------



## noirua

Smurf1976 said:


> Does anyone know what's happening with Australian domestic (as opposed to export) coal prices? I'm assuming they are lower than export given the shipping constraints etc.





Quite a lot of Aussie Power Stations have their own coal reserves, and train and truck the coal in. OneSteel has an agreement with BHP where they use the same trains, back and forth, for coal, iron ore, pellets, pig iron and steel.


----------



## noirua

What a fine Green Coal-Fired Australian Power Station, Koogan Creek, nr Chinchilla, QLD.

http://www.industrysearch.com.au/Ne...ralia’s_greenest_coal-fired_power_plant-27075


----------



## michael_selway

noirua said:


> Outlook 2008: Why Coal - The World's Forgotten Fossil Fuel - is About to Double in Price:  http:www.moneymorning.com/2008/02/14/out...tten-fossil-fuel-is-about-to-double-in-price/




Do u know what i think there will be an engery crisis in coming years, and it will be electricity & coal, oil to a lesser extent as coal is the most used for enegy needs. And yes its a need not want, so very hard to reduce our energy needs in this modern age

Its the capacity thats the problem rather than "runnign out" so to speak

thx

MS


----------



## osmosis

Which company is Australia's blue chip coal producer?


----------



## noirua

osmosis said:


> Which company is Australia's blue chip coal producer?




All the big miners, including Wesfarmers, have been mopping up the small and medium coal producers. Only company with a prospect of reaching the ASX100 that is only producing coal is Felix Resources, as 70% of the stock is owned by substantial holders. They may make it around 2012/13.


----------



## noirua

"Coal prices to decline as China resumes exports", and may affect negotiations on coal prices that normally conclude in March:  http://mjunction.in/market_news/coal_1/coal_prices_to_decline_as_chin.php

Price of thermal coal out of Newcastle port fell US$4.71 to $134.45 a tonne for weekending 22/2/2008.


----------



## michael_selway

noirua said:


> "Coal prices to decline as China resumes exports", and may affect negotiations on coal prices that normally conclude in March:  http://mjunction.in/market_news/coal_1/coal_prices_to_decline_as_chin.php
> 
> Price of thermal coal out of Newcastle port fell US$4.71 to $134.45 a tonne for weekending 22/2/2008.




Well a ST pull back would be reasonable ince its gone nuts in the last few months. 

thx

MS



> Coal prices to decline as China resumes exports
> February 29, 2008: Taiwan Power Co reported that the fuel's cost will drop after China restores exports in April. This will release the pressure on buyers to resolve term negotiations at double the price last year.
> 
> According to the head of the company's thermal coal unit, Albert Jen, at the McCloskey Group conference, the Chinese exports' resumption after a two month ban and reduced rainfall in Indonesia will enhance supplies.
> 
> Taiwan Power is awaiting the conclusion of price discussions of Japanese utilities with Australian sellers before talking with its suppliers, he added. Coal prices witnessed a hike after the heavy rains in Australia, snowstorms in China and power shortages in South Africa led to a decreased output.
> 
> "The Japanese could delay negotiations and wait for spot prices to fall. The next few weeks will be crucial because the talks usually conclude in March," mentioned Jen at Taipower.
> 
> Source: The Financial Express


----------



## noirua

michael_selway said:


> Well a ST pull back would be reasonable ince its gone nuts in the last few months. thx MS




Fair enough m_s, FLX profits at US$140 a tonne would be  about $600 million in 2009/10, and going up to $2.5 billion when Moolarben gets to full production in 2012/13. This won't happen and 2008/9 prices will/may be around US$105 for thermal and will drop back further as ports expand at the latter end of 2009 - make hay whilst the sun shines.


----------



## michael_selway

noirua said:


> Fair enough m_s, FLX profits at US$140 a tonne would be  about $600 million in 2009/10, and going up to $2.5 billion when Moolarben gets to full production in 2012/13. This won't happen and 2008/9 prices will/may be around US$105 for thermal and will drop back further as ports expand at the latter end of 2009 - make hay whilst the sun shines.




Yep it will be interesting going forward inthe comign years

*CEY, FLX, GCL, MCC, (RSP-NHC), WHC, AQA, RIV, COK, NEC, CZA, PRC, CDS, CNA, SRL, MLM, CES, EQX, *






http://www.forbes.com/global/2008/0310/016.html



> It's black and dirty, but that's not stopping coal from being hailed by miners and investors as "the new gold." Soaring prices, driven by Asian demand for power and aided by production shocks in coal-exporting countries, lie behind a global stampede to secure supplies for power generation and to make steel. "It's like the California gold rush," says Michael O'Keeffe, chief executive of Riversdale Mining, an Australian company exploring for coal in the southern African country of Mozambique.
> 
> Late last year one of India's biggest companies, Tata Steel, joined the search by paying Riversdale $91 million for a minority stake in a small portion of an exploration prospect in northwest Mozambique. It will be several years, at the earliest, before coal is mined at Benga on the banks of the Zambezi River, but Tata moved early to ensure its future entitlement to what was once regarded as an abundant commodity.
> 
> "There is a global shortage of both thermal (to generate electricity) and coking coal (to make steel)," says O'Keeffe, 56, who grew up in Cairns, Australia. "Indian demand for steel, and hence coking coal, is going through the roof. We've always believed that you'll be able to find iron ore for steel, but it's much harder to get coking coal."
> 
> Riversdale's coal discovery in Mozambique, coupled with its Tata deal, has put a rocket under its share price. Over the past 12 months Riversdale stock has more than tripled, even after a recent fallback. Riversdale is generating a small annual profit from a coal mine it acquired two years ago in South Africa, but the real game is its big discovery in Mozambique.
> 
> Different types of coal mean there is no common price. However, as a rough guide, prices for both thermal and coking coal have more than doubled over the past year (see chart) and are tipped to rise further.
> 
> Mark Pervan, senior commodity strategist in the Melbourne office of the Australia & New Zealand Banking Group, says the most recent sales of coking coal have been around $270 a tonne, more than double 12 months ago. Thermal coal has nearly tripled in price in the same span. By comparison, gold, which O'Keeffe reckons is being replaced by coal as the prospector's favorite, has captured attention by rising all of a third over the past 12 months to $920 per ounce.
> 
> "Iron ore is driven by demand, but the coal market is being largely driven by supply shortage," Pervan says. "Key global producers Australia, China and South Africa are grappling with weather-related disruptions. These supply problems, together with rising demand throughout Asia, are likely to keep a high floor on prices. Slowing exports out of Indonesia and Vietnam are also affecting the market, with Vietnam diverting output to meet stronger domestic demand."
> 
> Ironic, perhaps, at a time when the world is consumed with notions of carbon energy caps and nonfossil fuels, but old King Coal has never burned as hot. Today as an energy source, it accounts for an estimated 24% of global energy consumption, and 39% of electricity production.
> 
> China, traditionally a coal exporter, has banned coal exports over February and March to ensure it has enough to meet domestic demand for electricity production after being hit by a deep freeze and record-breaking snowstorms. Preston Chiaro, chief executive in London of the energy division of big miner (and takeover target) Rio Tinto, is surprised by the surge in prices. Rio Tinto is one of the world's biggest coal miners, with operations in North America and Australia. In the year to Dec. 31 it mined 156 million tonnes of coal, mainly thermal for power generation. "It's been a confluence of events," Chiaro says. "Weather is the big story, with rain in Australia and snowfalls in China. We had seen some tightness in the market before, but those two events really brought it to a head."
> 
> Flooding in open-pit coal mines in Australia over January and February forced five coal exporters, including Rio Tinto and Xstrata (other-otc: XSRAF.PK - news - people ), to declare force majeure, by which a company can blame events beyond its control for failing to fulfill a contract. Chiaro says the price rises were a warning shot of an ongoing coal shortage, not the vagaries of a temporary weather pattern. "The infrastructure for moving coal is really strained, so even small disruptions can have a big effect."
> 
> One of his headaches is the clogged Australian rail and port system. Over the past two years more than 50 ships have been riding daily at anchor off the major coal export ports of Newcastle, Gladstone and Dalrymple Bay waiting their turn to load. The record, according to The Australian newspaper, which visited each port to count ships at anchor, was 71, set on Apr. 28 last year
> 
> Another leading coal-mining country may also soon be exporting less. In January South Africa suffered severe blackouts when its state-owned power utility, Eskom, failed to generate enough electricity to meet demand. During a week of turmoil South African households were left in the dark, shops closed and tourists traumatized.
> 
> Blame for the power outages was put on a lack of investment in new power stations and problems with low-grade coal. Part of the solution is for Eskom to buy 45 million tonnes of extra coal to replenish its depleted stockpiles. Some of that coal was earmarked for export but will not now available.
> 
> It's a similar story in Vietnam, which plans to reduce coal exports by about 10 million tonnes a year, a 32% cut, to save coal for domestic use. And Bali has also experienced power outages from coal shortages.
> 
> An unnamed Vietnamese government official told Reuters on Feb. 15 that a number of new coal-fired power stations would begin operating this year. "The plan is to gradually reduce exports and eventually stop all coal exports to meet domestic consumption only," the official was quoted as saying.
> 
> South Africa's power crisis is music to the ears of people like O'Keeffe. He was planning to start the Benga joint venture with Tata by exporting coking coal to India but is now dusting off plans to start operations by delivering coal to a "mine-mouth" power station, which would burn lower-grade thermal coal and sell electricity into a grid that connects Mozambique with South Africa.
> 
> "We were targeting metallurgical coal," O'Keeffe says. "But what we might now do, provided we line up all our ducks, is get into coal production for a power station fairly quickly because we don't have to wash [remove impurities] that type of coal."
> 
> O'Keeffe, a former managing director in Australia for the big commodities trader Glencore, said his Indian partner, Tata, would not object to the potential for a thermal-first option because it could mean getting to the deeper coking coal quicker.
> 
> Paul Mazak, managing director of Churchill Mining, a London-listed explorer with coal assets on the Indonesia island of Kalimantan, said two countries dominated demand for coal in Asia. "They're the usual suspects, China and India," he says.
> 
> Churchill is in a similar position as Riversdale in that it has an asset in the ground but is yet to start mining. Despite its embryonic position as an explorer, Churchill is being inundated with inquiries from coal buyers hunting supplies. "The reason they're knocking on our door, even though we've yet to produce anything, is that buyers have now realized that it's no longer a buyer's world, it's a supplier's world," Mazak says. "They want long-term security of supply, which means they want to get involved with the mines, and the earlier the better."
> 
> O'Keeffe's plans for Mozambique have their roots in his background as a commodities trader with Glencore, where he had oversight of its coal business and where he learned all the intricacies of mining, exporting and trading coal. After quitting Glencore in 2004 O'Keeffe struck out on his own. "I left to start doing for myself what I'd been doing for Glencore," he says. "I'd completed what I'd been hired to achieve for Glencore, which was to be the number one trader in Australia."
> 
> Within days of his departure Riversdale was created, with coal as its primary focus. After looking around the Australian landscape O'Keeffe opted for greener pastures. "Australia has too many junior companies competing for limited opportunities," he says. "All of the big assets are held by majors. No junior explorer is discovering world-class assets in Australia. We reckoned it was best to chase elephants [big assets] in elephant country, and that means Africa. It is also fairly obvious that Africa has close proximity to India, which is at the start of a supercycle of growth for steelmaking. That makes our chosen location for exploration and mine development even more compelling."







thx

MS


----------



## michael_selway

Hi All i have added another coalie to the list (AVA)!

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, AVA, NEC, COK, CZA, PRC, CDS, CNA, SRL, MLM, CES, EQX,*







Let me know any others

Thx

MS


----------



## spectrumchaser

Massive price increase for coal - great news !


www.theaustralian.news.com.au/story/0,24897,23500477-601,00.html


----------



## countryboy

not alot wrtten about emeging coal explorers/producers Did a bit of research about RCI but can't remeber where i posted it !
RCI recently bought a Chinese mine and also have exploartion going on in Aus.At 17c a cheap play. Only down side i can see is a Whopping 50 million dollar loan to a chinese business man. Sounds a bit sus Does anyone have nore info on RCI that is not available on their website ?
anythoughts on Bowen BWN ?


----------



## michael_selway

countryboy said:


> not alot wrtten about emeging coal explorers/producers Did a bit of research about RCI but can't remeber where i posted it !
> RCI recently bought a Chinese mine and also have exploartion going on in Aus.At 17c a cheap play. Only down side i can see is a Whopping 50 million dollar loan to a chinese business man. Sounds a bit sus Does anyone have nore info on RCI that is not available on their website ?
> anythoughts on Bowen BWN ?




Hi some more coal stocks to the list

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, AVA, NEC, COK, CZA, PRC, CNA, CDS, WES, SRL, MLM, CES, EQX, EER, RCI...*






thx

MS


----------



## noirua

BHP has agreed a price increase, for hard coking coal, from 1st April 08 at US$300 per tonne, up from last years US$98 per tonne:  http://www.bloomberg.com/apps/news?pid=newsarchive&sid=askuT7WqoKRI


----------



## noirua

China's Shenhua Energy willing to accept US$135 per tonne on long-term thermal coal contracts:  http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aKc6iA4iyr.c


----------



## michael_selway

noirua said:


> China's Shenhua Energy willing to accept US$135 per tonne on long-term thermal coal contracts:  http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aKc6iA4iyr.c




Hi Noirua, thanks for the update

I also noticed the spot thermal coal price up again this week

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES, SRL, MLM, CDS, CES, EQX, EER, RCI, BLK, *


----------



## agro

anyone else notice that some of the green stocks today were mostly coal?

CEY

MCC - takeover << that was under $10 not long ago 

also some junior explorers, BWN and RCI up 13% respectively 


demand > supply


----------



## Aussiejeff

Crikey!!

Report in the news today that China ONLY HAS 12 DAYS COAL RESERVES LEFT - down another 3 days from the last estimate. Ominously a bit like the Doomsday Clock ticking....

What is the solution to a possibly catastrophic shut-down of their energy rapacious economy?



AJ


----------



## michael_selway

Aussiejeff said:


> Crikey!!
> 
> Report in the news today that China ONLY HAS 12 DAYS COAL RESERVES LEFT - down another 3 days from the last estimate. Ominously a bit like the Doomsday Clock ticking....
> 
> What is the solution to a possibly catastrophic shut-down of their energy rapacious economy?
> 
> AJ




Hm do you have any links to the above?

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES, SRL, MLM, CDS, CES, EQX, EER, RCI, BLK, BWN*

thx

MS


----------



## Aussiejeff

michael_selway said:


> Hm do you have any links to the above?
> 
> *CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES, SRL, MLM, CDS, CES, EQX, EER, RCI, BLK, BWN*
> 
> thx
> 
> MS





Sorry. Should have included the link first up. Try here Michael....

http://www.news.com.au/heraldsun/story/0,21985,23586655-5005961,00.html


----------



## Aussiejeff

Another link to the Shanghai Daily referring to China's pending coal shortage... 

http://www.shanghaidaily.com/sp/article/2008/200804/20080423/article_356943.htm

I'd love to know what the Chinese Government means by "we are working" on the problem. Seems that nothing they have done so far (eg: paying "crazy" price increases for urgently needed coke and coal shipments to cover their internal production shortfalls) has stopped China from getting desperately close to this critical shortage.

We all better pray that no disaster(s) befall their coking/coal production capacity in the near future! 

AJ


----------



## michael_selway

Aussiejeff said:


> Another link to the Shanghai Daily referring to China's pending coal shortage...
> 
> http://www.shanghaidaily.com/sp/article/2008/200804/20080423/article_356943.htm
> 
> I'd love to know what the Chinese Government means by "we are working" on the problem. Seems that nothing they have done so far (eg: paying "crazy" price increases for urgently needed coke and coal shipments to cover their internal production shortfalls) has stopped China from getting desperately close to this critical shortage.
> 
> We all better pray that no disaster(s) befall their coking/coal production capacity in the near future!
> 
> AJ




Hm world shortage would be a scary thing, imagine no light and electricty in Australia! Is this possible?

thx

MS


----------



## Aussiejeff

michael_selway said:


> Hm world shortage would be a scary thing, imagine no light and electricty in Australia! Is this possible?
> 
> thx
> 
> MS





Hey, no problemo amigo! It would seem not many ASF posters seem worried enough by this news to venture any opinion on what effect they might see it having on us here in Oz (and the rest of the world for that matter) IF China is forced to drastically reduce economic demand/output within a couple of weeks as a result of their coal reserves running out - obviously a worst case scenario.

IF that happens, I postulate that the fallout from Sub-Prime that shook world financial markets to the core will seem like a picnic in the park on a sunny day in comparison to the gloooom that would ensue from a sudden, severe Chinese economic downturn due to energy shortages. I guess time will tell. At least we won't have to wait long to see whether they can literally dig themselves out of the looming black hole. Say, when are the Olympics due to run? Opening Ceremony on 8th August. With the rate their coal reserves are dwindling, they might be lighting candles to run events by....

AJ


----------



## michael_selway

Aussiejeff said:


> Hey, no problemo amigo! It would seem not many ASF posters seem worried enough by this news to venture any opinion on what effect they might see it having on us here in Oz (and the rest of the world for that matter) IF China is forced to drastically reduce economic demand/output within a couple of weeks as a result of their coal reserves running out - obviously a worst case scenario.
> 
> IF that happens, I postulate that the fallout from Sub-Prime that shook world financial markets to the core will seem like a picnic in the park on a sunny day in comparison to the gloooom that would ensue from a sudden, severe Chinese economic downturn due to energy shortages. I guess time will tell. At least we won't have to wait long to see whether they can literally dig themselves out of the looming black hole. Say, when are the Olympics due to run? Opening Ceremony on 8th August. With the rate their coal reserves are dwindling, they might be lighting candles to run events by....
> 
> AJ




Hm interesting thanks, ok updated list

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, SRL, CDS, CES, EQX, EER, RCI, BLK, BWN, MLM, WES, 

LNC, AOE, SXP, MEE, CXY, ORG (coal seem gas)*






Thermal Coal back at $US130 a tonne (NEWC)

Thanks

MS


----------



## noirua

Interesting to see how the town of Mudgee, NSW, are expanding and updating on the back of the coal boom.
"Mudgee taking off":  http://mudgee.yourguide.com.au/news/local/news/general/mudgee-taking-off/767840.aspx


----------



## noirua

Splendid news from the budget as half of the $41 billion goes into building and infrastructure, much along the East Coast.  Supply constraints at Newcastle, a national embarrassment, will see money poured into improving present supply constraints:  http://www.abc.net.au/worldtoday/content/2008/s2244567.htm


----------



## Nick Radge

noirua, is that why some of the coal stocks are firm today, namely CEY, CZA and NHC?


----------



## MRC & Co

Yeh, I thought the same as Noirua as soon as I heard the Budget!

Nick, I imagine it would have an impact (thought not sure which particular infrastructure is being upgraded and which those companies you name use). 

Sure one of the F/A coal buffs here could shed some light?


----------



## noirua

Nick Radge said:


> noirua, is that why some of the coal stocks are firm today, namely CEY, CZA and NHC?



There are a lot of new coalmines coming into production in NSW and Queensland.  Rail services need upgrading to the port of Newcastle, NSW and to the Gladstone Port in Queensland. Newcastle Port is seeing a 65% upgrading by 2010 and the coal must get there on upgraded rail lines.  Gladstone has been upgraded and there is now a scramble to get the coal to the ports, but the rail services are just not there at times to Queensland's more Northern Ports. The coal Port of Abbotts Point is also being expanded.

All of the major mining companies have new mines coming onstream as well as the medium size and minnows in the coal sector.


----------



## michael_selway

Nick Radge said:


> noirua, is that why some of the coal stocks are firm today, namely CEY, CZA and NHC?




Hi Nick were you bearish on CEY at one stage?

thx

MS

-------------------------------------------------

*CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, SRL, CDS, CES, EQX, EER, RCI, BLK, BWN, MLM, WES, 

LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE (coal seem gas)*


----------



## Miner

Has any one got something to share on RIV ? The company shot to $8.40 in 12 months and has the huge reserve .


Regards


----------



## Smurf1976

michael_selway said:


> Hm world shortage would be a scary thing, imagine no light and electricty in Australia! Is this possible?
> 
> thx
> 
> MS



Always possible to have a (power) system collapse with or without a fuel shortage.

I'd better not post the specific details (national security and all that) but there are individual fuel sources (mines, processing plants etc) which would plunge one or more states into outright crisis if something happened. That something could be as simple as an accident, fire or even just a breakdown.


----------



## michael_selway

Miner said:


> Has any one got something to share on RIV ? The company shot to $8.40 in 12 months and has the huge reserve .
> 
> 
> Regards




Yep its not bad, maybe just a little expensive, but huge resource

*RIV - Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 3.5 47.3 5.4 13.9 
DPS 0.0 0.0 0.0 0.0 *






Btw thermal price up again! 138 on the NEWC index!


*Coal Thermal/Coking - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, SRL, CDS, CES, EQX, EER, RCI, BLK, BWN, MLM, WES, 

Coal Seam Gas - GLX, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE*


----------



## Spineli

A good starting point would be here...

http://en.wikipedia.org/wiki/Coal

Plenty posts above talk about a shortage crisis......this is quoted from the WorldEnergy Survery of Energy Resources:

"_As this Survey shows, coal is plentiful, widely
distributed and likely to be in continuing, and
increasing, demand for the foreseeable future._"

AND see below extract from Wikipedia

"_*World coal reserves*

At the end of 2006 the recoverable coal reserves amounted around 800 or 900 gigatonnes. The United States Energy Information Administration gives world reserves as 998 billion short tons[27] (equal to 905 gigatonnes), approximately half of it being hard coal. At the current production rate, this would last *164 years.*[28] At the current global total energy consumption of 15 terawatt,[29] there is enough coal to provide the entire planet with all of its energy for 57 years.[original research?]_"

Then consider the following:

"_Underground coal gasification allow access to more coal resources than economically recoverable by traditional technologies. By some estimates it will increase economically recoverable reserves by 600 million tonnes_"
http://en.wikipedia.org/wiki/Underground_Coal_Gasification

Another case of inaccurate information on a Wiki site!

*THAT SHOULD CORRECTLY READ "600 BILLION TONNES".*...check out the original source: 
http://www.worldenergy.org/documents/ser2007_final_online_version_1.pdf
(2007) Survey of energy resources (PDF), 21, World Energy Council (WEC), 7. ISBN 0946121265


*** In other words, a 600bn increase (via UCG) to 990bn present coal reserves is a 60% increase in potential supply

*** Assuming there was no preference in use between either UCG or present coal reserves - then I believe there would be a correction in the price of coal

*** However, Linc Energy has shown that the cost of extracting energy from coal via UCG is much cheaper than with open mines + the added benefits of a much cleaner (greenhouse friendly) process.

**** In the future, I see a seismic shift towards UCG coal mining for this very reason, massive potential reserves out there + in terms of the carbon trading scheme - since you won't be polluting that much, you have an incentive to undertake UCG and therefore dont pay much for carbon credits *

carbonneutral.com.au
"What is the cost to offset 1 tonne of CO2e? Price per tonne of CO2e for organisations offsetting more than 20 tonnes CO2 is $18 and for individuals it is $19."

That's an extra $20 / tonne incentive to CSG companies.

*CONCLUSION *---> The coal sector is heading to cleaner energy. CSG has many price advantages + 'clean benefits' (with policy backing). 

- Since the potential CSG reserves as estimated in the WorldEnergy Survey Report (length @ 600 pages ... if you have time) are 600Bn tonnes OR which would add ~ 60% to present World Coal Reserves...in terms of supply/demand, I would expect the coal price to ease off.

***So in other words, it might be a rush to find CSG deposits (which would ceteris paribus have higher NPV project values considering extraction costs / carbon credits


--------------------------------------------

Michael,

I notice above you have 17 companies with CSG exposure in your signature...are you keeping track of their resources? (proven / potential?)

WHAT DO YOU ALL THINK?


----------



## dj_420

Spineli said:


> Michael,
> 
> I notice above you have 17 companies with CSG exposure in your signature...are you keeping track of their resources? (proven / potential?)
> 
> WHAT DO YOU ALL THINK?




I know you asked Michael but I will provide some input, I have studied the coal companies list Michael provided us and identified that CEY has significantly more resources than other companies, CEY has around 2.5 billion tonnes of thermal/coking coal. 

Now the reason CEY is been held down is due to almost all of their coal sales been on long term contracts, _however_ it is very interesting to note that these contracts start winding down over the next two years making more and more coal available for overseas exports. 

CEY currently producing around 15 million tonnes per year which puts them near the top of the list in terms of amount produced.

IMO over the next few years as their production capacity expands and are able to sell more onto the spot market we will see a substantial increase in earnings. As it is next year I think they are estimated to be on a PE of 8 as compared to 15 this year.


----------



## mrgroundwork

Caledon Mining (CCD) listing on the 4th June... huge assets in the QLD Bowen Basin... heading into large producton phase over the next year or so... dual listed on the AIM/ASX... IPO was ridiculously oversubscribed...

check out their new technology they are using as well for extracting the resource... it is very interesting...


----------



## Muschu

Any thoughts on how sustainable the recent success of a number of coal stocks might be?
I am thinking in particular of FLX, GCL and CEY.  There may well be others.
Can this level of growth be maintained?  
Not asking for crystal ball gazing but it seems there are some exceptionally coal-knowledgeable contributors to this thread.
Thanks
Rick


----------



## LittleMak

http://www.worldenergy.org/documents/ser2007_final_online_version_1.pdf

Yes, interesting read, thanks for the link and info Spineli.

For those who want to have a quick read of the UCG and GTL reviews, open link and go to pages 15 and 19.


Also found this interesting on page 35-

_Australia
Proved amount in place (total coal,
million tonnes)
97 300
Proved recoverable reserves (total
coal, million tonnes)
76 600
Production (total coal, million
tonnes, 2005)
378.8
Australia is endowed with very substantial coal
resources, with its proved recoverable reserves
ranking 4th in the world. The major deposits of
black coal (bituminous and sub-bituminous) are
located in New South Wales and Queensland,
especially in the Sydney and Bowen basins;
smaller but locally important resources occur in
Western Australia, South Australia and
Tasmania. The main deposits of brown coal are
in Victoria, the only State producing this rank.
Other brown coal resources are present in
Western Australia, South Australia and
Tasmania_


And a little more on page 36-

_In 2005 Australia produced 308 million tonnes of
saleable black coal (bituminous and subbituminous)
and 71 million tonnes of brown coal.
The major domestic market for black coal is
electricity generation: in 2004, power stations
accounted for 85% of total black coal
consumption, with the other major consumer
being the iron and steel industry. Brown coal is
used almost entirely for power generation.
Australia has been the world's largest exporter
of hard coal since 1984: in 2005, it exported 233
million tonnes. About 54% of 2005 exports were
of metallurgical grade (coking coal), destined
largely for Japan, the Republic of Korea, India
and Europe._


----------



## michael_selway

Muschu said:


> Any thoughts on how sustainable the recent success of a number of coal stocks might be?
> I am thinking in particular of FLX, GCL and CEY.  There may well be others.
> Can this level of growth be maintained?
> Not asking for crystal ball gazing but it seems there are some exceptionally coal-knowledgeable contributors to this thread.
> Thanks
> Rick




Hi there's a good report out by Patterson's whichgives insight of those coal stocks you have mentioned

http://www.cockatoocoal.com.au/downloads/newsandresearch/Patersons Article 16 May 2008_8450.pdf

But it does look bullish even from here onwards. Also some new addtions to teh coal list!

*Coal (Thermal & Coking) - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, SRL, CDS, CES, EQX, EER, RCI, BWN, MLM, WES, GNM, ATQ 

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE*

thx

MS


----------



## Muschu

michael_selway said:


> Hi there's a good report out by Patterson's which gives insight of those coal stocks you have mentioned...MS





Many thanks Michael - a veritable smorgasbord!  I just scanned the Patterson link.  It added to my confusion - but that's my problem.  Obviously I need to study this a lot more than I have.
Cheers
Rick


----------



## Muschu

michael_selway said:


> Hi there's a good report out by Patterson's whichgives insight of those coal stocks you have mentioned
> 
> http://www.cockatoocoal.com.au/downloads/newsandresearch/Patersons Article 16 May 2008_8450.pdf
> 
> But it does look bullish even from here onwards. Also some new addtions to teh coal list!
> 
> MS





Hi Michael

I just had another look at the Paterson article which seems to have been published very recently [May 16].

They rated COK as a buy; FLX and MCC as Holds; and GCL as as a sell.

Your comment "does look bullish" looks spot on at this time.  

Have I got this right?

Patersons gave:

The SP of COK as $0.92; PT $1.74.  It is now $1.115.  Up 25%.
The SP of FLX as $16.66; PT $12.31.  It is now $21.69.  Up 30%.
The SP of MCC as $17.39; PT $16.70.  It is now $19.33.  Up 11%.
The SP of GCL as $9.97; PT $7.40.  It is now $12.40.  Up 24%.

IF I'm right you couldn't complain about any of them.  

Question seeking opinions in answer [not recommendations I know]:  Where is the best substance / value  in TA and FA terms for the longer-term investor? [Like some watchful retirees I know...]

Comments appreciated from anyone.

Thanks 

Rick


----------



## michael_selway

Muschu said:


> Hi Michael
> 
> I just had another look at the Paterson article which seems to have been published very recently [May 16].
> 
> They rated COK as a buy; FLX and MCC as Holds; and GCL as as a sell.
> 
> Your comment "does look bullish" looks spot on at this time.
> 
> Have I got this right?
> 
> Patersons gave:
> 
> The SP of COK as $0.92; PT $1.74.  It is now $1.115.  Up 25%.
> The SP of FLX as $16.66; PT $12.31.  It is now $21.69.  Up 30%.
> The SP of MCC as $17.39; PT $16.70.  It is now $19.33.  Up 11%.
> The SP of GCL as $9.97; PT $7.40.  It is now $12.40.  Up 24%.
> 
> IF I'm right you couldn't complain about any of them.
> 
> Question seeking opinions in answer [not recommendations I know]:  Where is the best substance / value  in TA and FA terms for the longer-term investor? [Like some watchful retirees I know...]
> 
> Comments appreciated from anyone.
> 
> Thanks
> 
> Rick




Hm it depends on whats the best value (for the future) at current prices

Its funny cause Ken Talbot just sold a lot of MCC shares and then bought RIV shares (see annoucement below!)

http://www.asx.com.au/asxpdf/20080529/pdf/319cglymz3zyx9.pdf

*Coal (Thermal & Coking) - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, CDS, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, MLM, WES, SRL

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

Btw new addition above TCM & GEL

http://www.tiarocoal.com.au/AR-M451U_20080307_170626.pdf

thx

MS


----------



## Muschu

michael_selway said:


> Hm it depends on whats the best value (for the future) at current prices
> 
> Its funny cause Ken Talbot just sold a lot of MCC shares and then bought RIV shares (see annoucement below!)
> 
> http://www.asx.com.au/asxpdf/20080529/pdf/319cglymz3zyx9.pdf
> 
> ....




So, in an even greater state of confusion, it's time for bed.  
Thanks Michael.
R


----------



## Muschu

This needs a wiser head than mine:
Towards the day’s end I lodged a buy order for GCL at $12.36, 4c below the day’s open.   High had been $13.03 . At 4pm the price was $12.40.  At 4.10pm it still showed $12.40.  Then a contract note came through saying I had bought at $11.76  - a new day’s low.  Checked again and there was a new close of $11.76 at 2 seconds before 4.11pm and again at 4.20pm.    So we had a lower volume day than yesterday, a lower low and a higher high.  But how can the SP drop a further 9% after close? Ridiculous.  No announcements that I can find...


----------



## YOUNG_TRADER

I got to get me alot more coal plays as I have but a few

Thanks for the info guys


----------



## michael_selway

YOUNG_TRADER said:


> I got to get me alot more coal plays as I have but a few
> 
> Thanks for the info guys




Hi YT, you have a few? which ones 

Btw have you looked at CDS & AVA today? unbelievable turn around 

thx

MS








> *Huntley's Initial Review on NHC 13/06/08*
> 
> NHC is a coal mining company firmly stamped
> with the financially conservative DNA of 61%
> shareholder, Washington H. Soul Pattinson (SOL). A
> conservative balance sheet makes NHC master of
> its own destiny and gives management freedom to
> be counter cyclical. Production is primarily export
> thermal, with a smaller component of domestic
> thermal coal. Most is mined at Acland which has
> low costs and a long life. Reserves of 235Mt are
> supportive of growth to at least 10Mt a year in
> the medium term compared to over 4Mt now.
> Jeebropilly and Oakleigh near Ipswich provide
> smaller contributions but cash costs are higher,
> reflecting limited life and simultaneous land
> development. Like sister company Brickworks (BKW),
> NHC turned the encroachment of urban areas on
> mining into a positive. Land development maximises
> returns from sunk capital costs, offers diversification
> and potentially a steady earnings stream to counter
> cyclical coal earnings. Longer term growth will come
> from coking coal via New Saraji.
> Our $6.40 a share valuation is made up primarily
> of two parts, the thermal coal business – mostly
> Acland – and New Saraji. Thermal coal accounts
> for $2.25 or 35% while Saraji is $3.25 or 51%. The
> remainder is net cash, a 17.7% Arrow Energy (AOE)
> shareholding, exploration projects and land, net of
> corporate expenses. Long term assumptions are
> US$60/t thermal coal, US$100/t coking coal, an
> A$/US$ exchange rate of 0.80 and a 10% discount
> rate. Deriving half the valuation from an exploration
> project is of some concern but New Saraji covers
> extensions to BHP’s mine which lowers resource and
> coal quality risks.
> Our FY08 NPAT forecast of $79.1m assumes NHC
> meets production guidance of 4.4Mt of coal,
> average US$65/t export thermal coal and an A$/
> US$ exchange rate of 0.90. FY09 profit will be
> significantly stronger with the record thermal coal
> contract price of US$125/t from April 2008, more
> than double 2007’s US$55/t. Our $154.7m forecast
> assumes 10% production growth, US$103/t export
> thermal coal and an A$/US$ exchange rate of
> 0.93. Unlike most coal companies, NHC’s has many
> contracts with prices settling throughout the year.
> This smooths prices and means contract changes
> take a year for the full impact to flow through. The
> recent US$125/t settlement won’t take full effect
> until FY10, when we expect earnings to approach
> 30c a share. Coal prices are forecast to decline to
> our US$60/t long term assumption by 2014, with
> NHC to see that price in FY16. Medium term land
> development earnings and Acland volume growth
> broadly offset lower margins beyond FY10 if coal
> prices decline to our long term forecast.
> Persistent infrastructure tightness will boost
> the outlook. Energy is vital and somewhat price
> insensitive. The market expects contract thermal
> coal to fall next year but it could surprise on the
> upside. Spot prices out of Newcastle touched
> US$150/t last week versus the US$125/t April 2008
> settlement. The high oil price is driving demand for
> vastly cheaper coal. Our assumption of stable prices
> until April 2010 could be conservative and thermal
> coal may well be higher next year.
> Domestic coal sells to local power stations. Export
> coal is railed to Brisbane on by Queensland Rail
> (QR). Capacity is limited by QR rolling stock, train
> size and competing Brisbane metro rail services.
> Despite this, incremental gains continue to be won.
> Rail capacity is expected to top out at 10-14Mt a
> year, compared to 5Mt now. Exports are via wholly
> the owned Queensland Bulk Handling (QBH) port.
> QBH is under long term lease from the Port of
> Brisbane. Stage 1 expansion from 5Mt to 7Mt is
> set to finish October 2010. A likely Stage 2 will lift
> capacity to 10Mt.
> QBH serves just two customers, NHC and US major
> Peabody. NHC should continue to secure capacity
> for mine expansions. Efficient management and low
> shiploader utilisation sees QBH demurrage free.
> Customers love NHC’s reliable supply. Despite being
> NHC mines thermal coal primarily
> from Acland, 140km west of
> Brisbane, a mid-low cost, long
> life mine. Smaller contributions
> are from Jeebropilly and
> Oakleigh near Ipswich where
> land redevelopment offers a
> potential new earnings stream
> after closure. Group production
> is 5Mt a year, 70% export and
> 30% domestic. Exports are
> through a 100% owned facility
> in Brisbane. Near term growth
> is from Acland exports. New
> Saraji in central Queensland’s
> Bowen Basin will add coking
> coal in the longer term. Coal
> seam gas and coal to liquids are
> early stage but may be important
> longer term. Management is
> astute, focused on cashflow,
> dividends and sensible long term
> investment. The balance sheet
> is strong with no debt and over
> $100m cash. Single commodity,
> infrastructure and mining risk
> require consideration.
> Huntleys’ Your Money Weekly 5 June 08 19
> a small port – 5Mt a year versus 55Mt at Dalrymple
> Bay – QBH is low cost. Central Queensland
> producers suffer much higher port fees at Dalrymple
> Bay. The few dollars NHC saves on each tonne of
> coal helps build a moat.
> Longer term growth is driven by high grade coking
> coal from New Saraji. New Saraji covers the
> underground extensions to BHP’s Saraji mine.
> Resources of 690Mt are already sufficient to support
> a world class coking coal mine. Management’s
> ultimate resource target of 1.5Bt looks achievable.
> Starting 2011, planned production rises to 10Mt
> a year by 2017, making NHC a significant export
> coking coal player. The global seaborne coking coal
> market is just over 200Mt a year. The timetable to
> full production at Saraji looks conservative, but is
> prudent given Queensland infrastructure issues.
> If the boom roars for the next decade and access
> to infrastructure remains problematic, coal prices
> will be higher. Acland, with secure access to QBH,
> effectively hedges potential delayed Saraji earnings.
> Higher coal prices increase New Saraji’s
> attractiveness to established miners, particularly
> miners with infrastructure access but short mine
> life. NHC could sell a portion of New Saraji equity
> to cover NHC’s share of capital costs and reduce
> financial risk. Neighbour BHP is the logical partner.
> Instant underground access from BHP’s opencut
> and use of existing coal processing capacity offers
> significant capital cost savings. BHP is also the
> dominant coking coal exporter.
> The exploration portfolio includes Darling Downs,
> Bee Creek and New Lenton. Darling Downs covers
> 4500 square kilometres Around Acland in the Surat
> Basin. It is prospective for shallow open thermal
> coal deposits for export, domestic power generation
> and coal to liquids. Bee Creek in the Northern
> Bowen Basin is in close proximity to operating mines
> and has coking coal potential. New Lenton covers
> depth extensions to Peabody’s Burton mine which
> produces coking and thermal coal. Resources of
> 84Mt at Lenton and 9Mt at Bee Creek are limited
> only by drilling. NHC also has an option on coal
> seam gas via a 17.7% interest in Arrow Energy.
> Market value is over $400m. Shell’s agreement
> to invest up to $776m in Arrow for a 30% stake
> is another endorsement of coal seam gas by an
> overseas energy major.


----------



## Julia

I don't want to put anyone in the position of being accused of ramping, but if I'm looking at CEY, GCL and MCC, is there a stand out one here, and if so why?
I already have FLX.

There seems to be so much good stuff to choose from in coal stocks so I'd be really appreciative of any opinions here.

With thanks.

Julia


----------



## michael_selway

Muschu said:


> This needs a wiser head than mine:
> Towards the day’s end I lodged a buy order for GCL at $12.36, 4c below the day’s open.   High had been $13.03 . At 4pm the price was $12.40.  At 4.10pm it still showed $12.40.  Then a contract note came through saying I had bought at $11.76  - a new day’s low.  Checked again and there was a new close of $11.76 at 2 seconds before 4.11pm and again at 4.20pm.    So we had a lower volume day than yesterday, a lower low and a higher high.  But how can the SP drop a further 9% after close? Ridiculous.  No announcements that I can find...




Yeah there is some soem volatility in the coal stocks in general because of how much they have gained this year

* GCL Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 22.8 31.7 156.2 279.4 
DPS 14.0 16.4 77.0 75.2* 

For GCL the forward numbers still look pretty good

Btw some new addtiosn to the list of coalers, FSE, CAG

*Coal (Thermal & Coking) - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, CDS, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CAG, SRL, MLM, WES,

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

thx

MS


----------



## michael_selway

Julia said:


> I don't want to put anyone in the position of being accused of ramping, but if I'm looking at CEY, GCL and MCC, is there a stand out one here, and if so why?
> I already have FLX.
> 
> There seems to be so much good stuff to choose from in coal stocks so I'd be really appreciative of any opinions here.
> 
> With thanks.
> 
> Julia




Most coal stocks fell today, so mayhave been a good buying opportunity

http://online.wsj.com/article/SB121426607541798571.html?mod=googlenews_wsj
http://uk.reuters.com/article/oilRpt/idUKN2438401420080624



> Coal Producers Struggle to Meet Demand
> 
> Shortage of Miners,
> Investment Makes
> Output Boost Tough
> By KRIS MAHER
> June 24, 2008; Page A4
> 
> U.S. coal producers have been largely unable to meet growing demand because of a lengthy permitting process, lack of capital investment and a shortage of skilled miners, which will keep supplies tight and prices high.
> 
> 
> 
> 
> The underlying industrywide issues are compounded by severe floods in the Midwest, which have stranded barges full of coal and submerged railcars used to haul coal. It isn't clear what impact those interruptions will have on supplies and prices.
> 
> Paul Forward, a coal analyst with Stifel, Nicolaus & Co., expects demand for coal in the U.S. to outstrip supply this year by 15 million tons, in large part because of the increase in exports, which shot up 49% through April compared with last year. Constraints to production also played a role in the growing shortfall, he said.
> 
> Limited Supply Response
> 
> "Despite the strong margins that coal companies are seeing, the supply response has so far been limited," said Mr. Forward. "I think it's probably a couple years worth of time where these markets stay tight."
> 
> Up to 40 million tons of potential and anticipated coal production is being held back because of delays in obtaining environmental permits and new safety regulations, estimates David Khani, director of research at FBR Capital Markets Inc. in Arlington, Va.
> 
> While 40 million tons doesn't seem significant given that the U.S. produced 1.15 billion tons of coal last year, even small shifts in supply can have a big impact on price. The reason, analysts say, is that a large percentage of coal supply is tied up in multiyear contracts, so there is little slack to make up for production shortfalls. That could force some utilities to buy coal at current high spot-market prices and pass some of those costs on to consumers.
> 
> "People are going to get sticker shock when they open their electricity bills this summer and next summer," said Mr. Khani. Price increases will depend on rules in individual states and on the hedging strategies of utilities.
> 
> The Midwest flooding is expected to further tighten stockpiles, by taking several million tons of coal offline, said Vic Svec, a senior vice president at Peabody Energy Corp., in St. Louis, the world's biggest coal producer. Peabody expects to produce between 235 million and 245 million tons of coal this year, compared with 238 million tons produced last year. Roughly 10% of that production is high-quality coking coal in Australia.
> 
> The supply constraints are most acute in Central Appalachia, which accounts for 25% of the coal mined in the U.S. but has a greater impact on market conditions because coal from the region generates more heat per ton than coal from other areas like the Powder River Basin in Montana and Wyoming.
> 
> The spot price of Central Appalachian coal sold to both utilities and steelmakers has tripled in the past year, with coal going to utilities rising to as much as $140 a ton from $44 a ton, and that destined to steelmakers to $300 a ton, from $100 a ton. Coal production in the region declined 2.3% through early June compared with the same period last year, according to an analysis by Mr. Forward of Stifel, Nicolaus of U.S. Energy Information Administration data.
> 
> Hard to Increase Output
> 
> "In general it's hard in the short run in our business to dramatically increase production," said Thomas Hoffman, a spokesman for Pittsburgh-based Consol Energy Inc., the nation's fifth-largest coal company by production. "It's not like we have a bunch of idle production and we can just turn a key and out it flows like water through a pipe." Consol, which operates 16 mines in Appalachia and one in Utah, is hoping to boost production 10% to 70 million tons this year.
> 
> Industry officials say high operating costs are deterring small operators from opening mines to take advantage of high prices and help relieve supply constraints. Even big companies face higher costs associated with safety regulations and the inability to get enough mine workers. Massey Energy Co. said the biggest challenge to its plan to increase production by up to 9% this year is its ability to find and hire 300 to 400 new miners.
> 
> Dan Roling, chief executive of National Coal Corp., of Knoxville, Tenn., which operates mines in the Southeast, said the mining industry was reluctant to buy new machinery and develop new mines when prices were lower. "Until these higher prices [arrived], the industry has not been investing," he said.
> 
> As a result, mining companies aren't able to take full advantage of the strong demand






> US coal stocks drop 1.1 pct from last wk -Genscape
> Tue Jun 24, 2008 5:00pm BST
> 
> More Business & Investing News... HOUSTON, June 24 (Reuters) - U.S. power plants have 1.1 percent less coal on hand this week than last as summer heat and floods contribute to stockpile depletion, Genscape said Tuesday.
> 
> The cushion over inventories last year also fell 1 percentage point to 2.2 percent as of Monday, the industry data provider said.
> 
> Heat in the West South Central region and floods interrupting barge traffic on the upper Mississippi River caused drawdowns, Genscape said.
> 
> "The stock draw is likely to accelerate over the next two weeks as high temperatures push into the Midwest and Southeast and eastern production declines due to the July 4 holiday," Genscape said.
> 
> The heat and floods come against a background of high natural gas prices, which encourage utilities to burn cheaper coal at a greater rate to control costs.
> 
> The cushion in days of burn available this year over last fell to one, down one for the second consecutive week. Utilities had 54 days of average coal burn on hand.
> 
> Utilities had 150.2 million short tons of coal stockpiled compared with 151.8 million tons last week and 147 million tons in the same week last year.
> 
> Mathematical rounding sometimes affects the results, overstating some changes and understating others, Genscape has said. The firm recently revised its model, which altered totals. (Reporting by Bruce Nichols)




http://www.miningweekly.com/article.php?a_id=135449


----------



## michael_selway

Hi just soem new addtions to the list

*Coal (Thermal & Coking) - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, CDS, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CAG, CWK, REY, LOD, SRL, MLM, WES,

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

thx

MS


----------



## agro

is the coal run over? or just a temporary thing?



> MORE than $25 billion was wiped from Australian resources stocks yesterday as falling coal prices and concerns that record oil prices would begin to weigh on global growth started a rush for the exits.
> Coal and iron ore miners suffered most as investors hit the sell button amid concerns a seemingly unstoppable surge in oil prices could crimp global growth, The Australian reported.
> 
> A drop of about 10 per cent in the spot price of coal in the US, Europe and Australia was the catalyst for many sales and sent shares of Centennial Coal tumbling 14 per cent and Macarthur Coal down 7.7 per cent.
> 
> The biggest stock on the exchange, BHP Billiton, was sent plummeting 7 per cent and its $US160 billion takeover target Rio Tinto, which does not have an oil business, fell 7.8 per cent.
> 
> Both companies are highly exposed to moves in coal and iron ore prices, which have insulated them recently from sliding base metals prices. That they are reaping record contract price rises for both did not seem to matter.
> 
> The on-paper wealth of Australia's richest man, Andrew "Twiggy" Forrest, was taken down a peg or two, his iron ore upstart Fortescue Metals Group, now Australia's third-biggest miner by value, losing 12 per cent.
> 
> "The big catalyst for declining resources was that over-the-counter coal price fell in a heap, sending most US coal stocks down," Macquarie Private Wealth associate director David Halliday said.
> 
> "You've seen falls in base metals and now in coal. It gets people thinking all these bubbles burst at some point."
> 
> The absence of a break in rising oil prices also spurred concerns that the engine room for global growth and commodities demand, China, will at some stage take a hit from surging energy costs. Benchmark New York crude oil futures crossed $145 a barrel in trading last night, leaving the psychologically important $150 level just a stone's throw away.
> 
> Illustrating just how contagious a bout of selling can be, energy stocks were not seen as a safe haven and the ASX/S&P200 energy index dropped 4.2 per cent.
> 
> The recent health of energy company shares was reason enough for some to get out, figuring prices were probably too high and fearing others were thinking the same thing.
> 
> Shares in Australia's biggest dedicated oil and gas company, Woodside, slid 3.9 per cent and Queensland's coal seam methane companies, which are banking on profiting from surging Asian energy demand, were hit harder.
> 
> Queensland Gas ended down 5.4 per cent and its LNG export rivals Sunshine Gas and Arrow were down 9.5 per cent and 7.3 per cent, respectively.
> 
> Takeover target Origin Energy was little changed, ending at $16.28, supported by a cash offer from British gas giant BG Group.
> 
> Origin chief executive Grant King will unveil Origin's response to the bid this morning. Santos also weathered the storm quite well, closing down 3 per cent.
> 
> The S&P/ASX 200 materials index, largely made up of miners but including steel makers and chemical makers, finished the day down 6.1 per cent, losing more than $20 billion in value, and the energy index lost about $5 billion.






> Canadian coal producers suffered a mammoth meltdown yesterday as the bright prospects that have driven the sector to massive gains began to dim on fears the stocks rose too far too fast and demand may deteriorate.
> 
> Concerns that the need for metallurgical coal, which is used to make steel, will weaken, sent units of Fording Canadian Coal Trust plunging 16 per cent.
> 
> Analysts and traders said there were no specific developments or events in the steelmaking or the metallurgical coal industry to account for the broad selloff, which also captured Western Canadian Coal Corp., Grand Cache Coal Corp. and diversified miner Teck Cominco Ltd.
> 
> However, European spot prices for thermal coal, which is used to generate electricity, suffered the largest one-day drop in three years.
> Print Edition - Section Front
> 
> Section B Front  Enlarge Image
> More Report on Business Stories
> 
> * The high cost of filling up
> * Fugitive hedge fund swindler Israel surrenders in Massachusetts
> * Canadian car sales outperform U.S. market
> * The party's over for Canadian spendthrifts
> * Saskatoon grapples with boomtown pains
> * As sales sag, GM's war chest is key
> * Go to the Report on Business section
> 
> The Globe and Mail
> 
> The selloff followed a stunning month-long rally that saw prices gain more than 33 per cent.
> 
> The thermal coal price slide, coupled with lingering concerns about the global economy in the wake of what is widely believed to be a U.S. recession, was grounds enough for many coal investors to head for the exits.
> 
> Until yesterday, some had taken to calling coal the "other black gold" as prices had skyrocketed on weather related production problems in Australia, China and South Africa, elevating the once-lowly commodity's status among investors.
> 
> While contract prices for both thermal and met coal have more than doubled, the sustainability of the record prices remains in question.
> 
> One analyst noted that coal stocks have run very hard in the last few months and said expectations that were embedded in the share prices were likely unrealistic.
> 
> Fording owns a 60-per-cent stake in The Elk Valley Coal Partnership - Canada's largest met coal operations.
> 
> Teck Cominco operates the facilities, owns about 20 per cent of Fording and has a 40-per-cent stake in the Elk Valley operations, giving it a 52-per-cent interest in the overall partnership,
> 
> Fording units have more than doubled this year. The company put itself up for sale in late 2007 and said in May that it expects to receive an average of $275 (U.S.) a tonne for its coal for the 2008 coal year. That compares with just $93 a tonne the customers paid last year.
> 
> Demand for steel from China has been the main driver of the dramatic met coal price increases.
> 
> But some believe the red-hot Chinese economy's growth may begin to slow following the Olympic Games in Beijing this summer.
> 
> Other concerns for steel demand come from the dismal outlook for the U.S. auto sector, which is teetering on the brink of collapse due to spiking gasoline prices.
> 
> Teck Cominco spokesman Greg Waller said his company has seen no signs of slowing demand for met coal.
> 
> "Not at all. Steel prices are quite strong right now and have continued to march up over the last six months or so. What's happening in the U.S. market isn't necessarily a reflection of what's happening in the rest of the world," he said.
> 
> Most experts are currently predicting that 2009 will be another strong year for met coal demand and say prices should remain well above historical norms. Pricing for 2010 and beyond is far less clear, however, creating nervous shareholders.



http://www.theglobeandmail.com/servlet/story/LAC.20080703.RCOAL03/TPStory/Business


----------



## michael_selway

agro said:


> is the coal run over? or just a temporary thing?
> 
> "The big catalyst for declining resources was that over-the-counter coal price fell in a heap, sending most US coal stocks down," Macquarie Private Wealth associate director David Halliday said.
> 
> 
> http://www.theglobeandmail.com/servlet/story/LAC.20080703.RCOAL03/TPStory/Business




Hey I wonder wher ethey got those spot prices from?

If you go to http://www.globalcoal.com its actually gone up a new high of $190+?

*NEWC Index 
06-Jun-08 158.53 
13-Jun-08 160.23 
20-Jun-08 162.66 
27-Jun-08 172.10 
04-Jul-08 194.79 *







thx

MS


----------



## michael_selway

agro said:


> is the coal run over? or just a temporary thing?
> 
> http://www.theglobeandmail.com/servlet/story/LAC.20080703.RCOAL03/TPStory/Business




Hm there was small fall in coal price this week






13-

*NEWC Index

13-Jun-08 160.23 
20-Jun-08 162.66 
27-Jun-08 172.10 
04-Jul-08 194.79 
11-Jul-08 188.00 

Mar-2008 125.56  
Apr-2008 126.45  
May-2008 138.31  
Jun-2008 163.38  *

thx

MS


----------



## noirua

With comments recently in Australia concerning green issues, it should be remembered that UCC coal technology is being funded greatly by coal mining companies.
Australia will increasingly supply UCC coal as Vietnam reduces exports, due to personal needs.


----------



## michael_selway

noirua said:


> With comments recently in Australia concerning green issues, it should be remembered that UCC coal technology is being funded greatly by coal mining companies.
> Australia will increasingly supply UCC coal as Vietnam reduces exports, due to personal needs.




Yep btw a few new coal companies BTU & AAL

*Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, 
Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, WES,

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

Thx

MS


----------



## YOUNG_TRADER

Well looks like there's life yet in the Coal sector with BHP announcing a *$3.7 Billion Deal*



The world's biggest miner BHP Billiton Ltd says it has struck a deal to acquire 100 per cent of the New Saraji project from New Hope Corp Ltd for *$2.5 billion cash and $1.2 billion worth of BHP shares * in a 50/50 joint venture with Mitsubishi Corp.

"This acquisition is consistent with our strategy to accelerate growth in long life, low cost natural resources with a focus on delivering shareholder value," said BHP Billiton coal president Dave Murray.

New Saraji is an undeveloped metallurgical coal resource located next to the joint venture's Saraji mine near Dysart in Queensland's Bowen Basin.

"New Saraji has extensive high quality metallurgical coal resources," said Mr Murray.

"Subject to the results of further resource exploration and evaluation program to be undertaken by BMA, New Saraji has the potential to be developed into a large scale, high quality metallurgical coal operation."

"New Saraji could also potentially deliver significant synergies due to its proximity to BMA's existing Saraji mine," Mr Murray said.

The acquisition is likely to be scrutinised by regulators and third parties, BHP said.


----------



## simartech

Greetings to all
As a scientist and engineer who has spent 30 years in the coal industry I was impressed by the quality of the data represented. In my view coal has at least another 50 to 80 years of growth and will be limited by the extraction rate and enviromental issues. Coal used in the power industry is converted mainly in what are called supercritical boilers. Over all efficiency of conversion is now over 42%. This is exceptional when compared to other forms of conversion. Even at $300 a ton it sells for $12 per GJ vs over $30 for oil.
It represents a very reliable and consistant base load fuel, and the presence of base load power makes wind turbines possible, the latter supplies spinning reserve and stability to the grid. If this was not the case the frequent stops and starts as well as the high overnight load would make wind turbine grid power impossible. 

Coal has recently been demineralised and made into nanopowder so that it an be used directly in gas turbines and diesels. Extending the use will have its technical challenges but it has a high energy density (30 GJ per ton in that form)

I am currently looking at good coal plays I have been impressed by CDS, probably because  of the personalities involved. The coal technology employed by  ESKOM is very high. SASOL uses the Fischer Tropaz process to produce liguids and this may now be viable. I note that LINC propose to do this with insitu gasification. Your comments would be appreciated. 
Cheers Simartech


----------



## noirua

India's coal industry is set for a 100mtpa shortfall:  http://www.brr.com.au/event/48058/indias-mineral-riches-and-mining-laws


----------



## noirua

Well, well, well, if it isn't good olde George W Bush to push and congratulate the coal lobby.  Looks like its green energy out of the window and bring in lots of US Coal from West Virginia. Best way to keep oil prices down...
http://www.necn.com/category/32/14540


----------



## michael_selway

noirua said:


> Well, well, well, if it isn't good olde George W Bush to push and congratulate the coal lobby.  Looks like its green energy out of the window and bring in lots of US Coal from West Virginia. Best way to keep oil prices down...
> http://www.necn.com/category/32/14540




Hi sounds good






thx

MS


----------



## noirua

Mixed news now on coal prices going forward as the outlook changes. Asian companies are now allowing coal stocks to fall in anticipation of further falls in coal prices.

The number of ships waiting at anchor outside the Newcastle Port dropped to 23 last Friday against 30 a week earlier. Wait is now 11.3 days against 13.15 days.

Last week 25 ships left Newcastle bound for: 17 Japan, 4 Taiwan, 2 Malaysia, 1 South Korea and 1 Turkey.

Thermal coal prices have come down from a peak of about US$194 per tonne to US$160.40 last week. Benchmark thermal price was set at US$125 per tonne from 1st April last.  Meanwhile the Aussie has dropped from A$1.04 to A$1.09 against the Greenback.


----------



## noirua

With the cash bid for Lonmin by Xstrata coming after the ASX close.
The price for Lonmin was 50% above the London closing price on Tuesday, and this may play well for coal and other mining stocks at the opening tomorrow.


----------



## imajica

quote from AQA's latest announcement:

The Company’s total attributable JORC compliant Measured, Indicated and Inferred
Resources from its coal projects is 2.6Bt of predominantly hard coking coal (please refer to
Aquila’s previous announcements to the ASX, on 26th March 2008, 9th, 11th June 2008 and 1st
July 2008, for detailed resource statements).



2.6 Billion tonnes of hard coking coal is a huge resource - we are talking hundreds of years of mine life

add on another 1/2 a billion tonnes of iron ore and you have a company that is diverse enough to become a big player

recent share market weakness is just a good excuse to top up


----------



## noirua

imajica said:


> quote from AQA's latest announcement:
> 
> The Company’s total attributable JORC compliant Measured, Indicated and Inferred
> Resources from its coal projects is 2.6Bt of predominantly hard coking coal (please refer to
> Aquila’s previous announcements to the ASX, on 26th March 2008, 9th, 11th June 2008 and 1st
> July 2008, for detailed resource statements).
> 
> 
> 
> 2.6 Billion tonnes of hard coking coal is a huge resource - we are talking hundreds of years of mine life
> 
> add on another 1/2 a billion tonnes of iron ore and you have a company that is diverse enough to become a big player
> 
> recent share market weakness is just a good excuse to top up




I notice AQA has only a 24.5% interest in the Belvedere Coal Project 3.8 billion tonnes, and 50% interest in Eagle Downs, 780mt.  These potential mines comprise semi-hard coking coal, PCI coal and some thermal products. These potential mines are of course not developed yet.
The Issaacs Mine looks good and will produce 2.6mtpa of predominantly semi-hard cokig coal. AQA has a 50% interest.


----------



## noirua

China are to introduce a 10% export tax on coal to discourage exports.  Coke  tax raised to 40% from 25% and other coking coals to 10% from 5%:  http://www.reuters.com/article/rbssCoal/idUSSHA5694320080818


----------



## michael_selway

noirua said:


> China are to introduce a 10% export tax on coal to discourage exports.  Coke  tax raised to 40% from 25% and other coking coals to 10% from 5%:  http://www.reuters.com/article/rbssCoal/idUSSHA5694320080818




Thanks not bad at all, coal prices still strong







* NEWC Index 
25-Jul-08 174.70 
01-Aug-08 160.40 
08-Aug-08 156.16 
15-Aug-08 163.90 *


thx

MS


----------



## Garpal Gumnut

Can anyone advise me on the better coal plays at this point in time?

gg


----------



## michael_selway

Garpal Gumnut said:


> Can anyone advise me on the better coal plays at this point in time?
> 
> gg




Hm below is quote from another site






> I (bungi2) divided the Market Capitization by the Resource estimates for a number of companies.
> 
> Please take into account the different levels of maturity, type of coal,location etc. Also take into account that the coal sector has been smashed over the last couple of months.




*Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES 
Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

Thx

MS


----------



## noirua

Coal miners wait on tenter hooks as Xstrata conclude their October 1st prices for thermal coal, to Japan.  They are reported to have given way to pressure on their offer at US$175 per tonne as the Newcastle Port prices drop.

Coal stocks are set to react to the final deal that is thrashed out.


----------



## michael_selway

noirua said:


> Coal miners wait on tenter hooks as Xstrata conclude their October 1st prices for thermal coal, to Japan.  They are reported to have given way to pressure on their offer at US$175 per tonne as the Newcastle Port prices drop.
> 
> Coal stocks are set to react to the final deal that is thrashed out.




Hi yeah looks liek a drop in coal prices thsi week









> Australia Sets Up Global Body to Promote Clean Coal
> Australia's government set up a A$100 million ($80 million) global clean-coal institute to encourage companies such as BHP Billiton Ltd. to establish low- emissions power projects that help tackle global warming.
> Prime Minister Kevin Rudd, who ratified the Kyoto Protocol on his first day in office and wants to cut emissions 60 percent by 2050, announced the plan in Canberra today.
> 
> ``Our intention with these projects is to reduce greenhouse gas emissions,'' said Rudd, 50. ``This is an important area to achieve real results.''
> 
> The government wants to promote projects that use new technology to help reduce emissions of carbon dioxide and other gases blamed for global warming. The institute will promote the development of clean-coal ventures and help them raise funds, Rudd said. Resources and Energy Minister Martin Ferguson said BHP and the Rio Tinto Group back the initiative.
> 
> ``BHP Billiton is very committed to the reduction of C02 in the atmosphere,'' Chief Executive Officer Marius Kloppers said in an interview today. ``We believe the science is real, we believe it's highly necessary to stabilize C02.''
> 
> Australia's upper-house senate is expected to approve legislation allowing the country to set up storage sites off its coast to hold carbon captured during power production, Ferguson said. The House of Representatives passed the legislation yesterday, he said.
> 
> Governments may participate in carbon-capture projects, said Rudd, who will brief the United Nations General Assembly on the institute in New York next week.
> 
> The aim is to have the institute operating by January, Rudd told reporters. It will be based in Australia, with the location still to be decided, he said.
> 
> Bloomberg - 19-Sep-08




http://www.globalcoal.com/news/coalnews.cfm

thx

MS


----------



## noirua

michael_selway said:


> Hi yeah looks liek a drop in coal prices thsi week
> 
> 
> 
> 
> 
> 
> 
> 
> http://www.globalcoal.com/news/coalnews.cfm
> 
> thx
> 
> MS



The coal miners who have reserves principally in Aus or NZ
will gain or lose on the basis of how the AU$ and NZ$ do against the US$.
The fall by the AU$ is about 17% after todays wild swings.
The thermal benchmark was set at US$125 for 1st April annual contracts.

Complication arise because China added a tax on coal exports from thermal up to coke. Also export restrictions remain in force for the time being.
India is reported to be about 100 million tonnes short of power station coal going forward.
There is extra capacity now in QLD which may put pressure on prices up there.
Restrictions at Newcastle will probably remain in force until the second quarter of 2010.
So, all in all, there is very little likelihood of thermal coal prices falling that much further before a recovery ensues.


----------



## noirua

Bloomberg reports today that the price of thermal coal out of the Newcastle Port for 19th Sep 08 was US$137.30 a tonne, down US$14.35 from last week.

Demand for coal is expected to weaken inline with oil as coal is reported to be building up at China's Ports for export.

Coal shipped at Newcastle was up 38% last week with waiting time pushed down to 8.89 days.

Australia's coal exports are expected to rise 4.2% in 2009 to 192.4 million tonnes.


----------



## agro

how come all the coal stocks (FLX, MCC, CEY) are getting absolutely smashed of late? is it to do with the garneout report?


----------



## noirua

agro said:


> how come all the coal stocks (FLX, MCC, CEY) are getting absolutely smashed of late? is it to do with the garneout report?



If economies decline rapidly then less coal will be needed just at the time as coal being mined expands.
There will still be good demand for power station coal, quality thermal, but demand for other coal may well drop.
Aussie coal companies need the Aussie$ to decline further  and this will be a great help.

Fortunately the Newcastle Port expansion will not be ready until 2010 and prices should hold up well, when AU$ prices are taken into account for coal exported.

FLX, CEY, MCC and GCL have fallen badly. Felix are doing better due to the bid situation and have sold 49% of the Minerva Mine and 45% of Ashton, and have a good sales position in place. The Moolarben open-cut mine has most of the 4mtpa production, from 2010, sold in advance in a 25-year-deal with the 20% holders in the project. 

I have a holding in all four mines, above mentioned, and Felix look the strongest in the present situation with the best dividend prospects.


----------



## noirua

Thermal coal prices out of the Newcastle Port fell to US$111.90 a tonne for weekending 10th October 2008. Waiting time reduced to 8.6 days from 9.3 days the week before. Waiting at Gladstone Port, QLD, was zero.


----------



## roland

noirua said:


> Thermal coal prices out of the Newcastle Port fell to US$111.90 a tonne for weekending 10th October 2008. Waiting time reduced to 8.6 days from 9.3 days the week before. Waiting at Gladstone Port, QLD, was zero.




I wonder if someone has factored in the huge drop in the Aussie dollar, has it offeset the fall in Coal prices enough to negate the price decline?

FMG made a big song and dance about the exchange rate windfall today, I'd expect, unless MCC and others are hedged, they should be doing a lot better right now....


----------



## noirua

roland said:


> I wonder if someone has factored in the huge drop in the Aussie dollar, has it offeset the fall in Coal prices enough to negate the price decline?
> 
> FMG made a big song and dance about the exchange rate windfall today, I'd expect, unless MCC and others are hedged, they should be doing a lot better right now....



Most companies are hedged about 20% to 35%, in the coal miner industry.

Peak for thermal was US$194 per tonne, spot price out of Newcastle Port, when the Aussie was AU$1.05 to the US$1: = AU$203 per tonne.

Present thermal spot price is US$111 per tonne, Aussie now at AU$1.427 to the US$1: = AU$158 per tonne.


----------



## Reealjrd

I think trading in coal stocks will not harm your investment. But i will only suggest to do intraday trading.


----------



## noirua

Spot thermal coal prices out of the Newcastle dock fell a further 6.4% last week to US$104.70 per tonne. Ships at anchor rose to 25 and demurrage stood at 8.8 days.


----------



## Reealjrd

This week there we can see some weakness in coal and oil prices. AS don't have any open positions and go for intra day trades and try to book profits.


----------



## noirua

It is expected that BHP Billiton would have to divest some of its iron ore and coal assets to fully satisfy authorities over its bid for RIO.


----------



## michael_selway

noirua said:


> Spot thermal coal prices out of the Newcastle dock fell a further 6.4% last week to US$104.70 per tonne. Ships at anchor rose to 25 and demurrage stood at 8.8 days.




Hi its closed to USD$96.00 this week!






thx

MS


----------



## noirua

michael_selway said:


> Hi its closed to USD$96.00 this week!
> thx
> MS



Hi m_s, thanks for that, you're sharp with the info.
Although I'm still well invested in coal stocks and still buying (pure Aussie coal stocks), I do accept that coal prices will plunge - in fact doing so.

Hopefully the plunging Aussie will allow thermal coal to go down to US$70 to US$90 per tonne without that much of a problem for the companies. As thermal coal is mostly used for power stations.

Very concerned about PCI coal, semi-soft, semi-hard and hard coking coal. As steel companies are wobbling already and many may crash or just not be able to afford coal anywhere near the present contract agreed prices. If these coals fell 50% to 60%, in US$'s, then I would not be surprised.


----------



## noirua

The slight strengthening in coal prices in Asia this week has given a boost to coal companies Macarthur Coal, Gloucester Coal, Centennial and Felix Resources.
A continued bounce is now expected for thermal coal out of the Newcastle Port after the 40% fall.


----------



## nulla nulla

Recent announcent from CEY was fairly upbeat. Succinctly they produce coal for powerstations which is much in demand globaly, particularly India & China where the power stations do not appear to have significant reserves of coal. Countries can play brinkmanship games with their iron ore suppliers (and the coal suppliers for smelting) but they get into hot water when they play silly buggers with their domestic power supply. The fall in the Australian dollar works in favour of Autralian coal suppliers to power stations where the sales are in US$. Any slowing in demand is offset by the gain on currency conversion.


----------



## noirua

Following Citigroup's forecast for thermal coal in April 2009 at US$100 per tonne. The market now foresees much lower prices for coking coal and PCI coal, as steel makers cut back sharply.


----------



## noirua

noirua said:


> Following Citigroup's forecast for thermal coal in April 2009 at US$100 per tonne. The market now foresees much lower prices for coking coal and PCI coal, as steel makers cut back sharply.



General views show increasing concern about coal sales to the steel industry. With this in mind, some companies may sell PCI coal into the thermal coal market as higher grade thermal.

Companies in South Korea and Japan that have joint ventures with Australian coal miners, are likely to be pressed to take extra coal from them and discontinue taking supplies from others.


----------



## noirua

Thermal coal continued its recovery at Newcastle, Europe and in the States on 7th Nov 08.  Up $3.19 to US$104.02, up $4.75 to US$105.65 and up $6.10 at US$104.50 a tonne.


----------



## roland

NSW raises coal royalties


http://business.smh.com.au/business/nsw-raises-coal-royalties-20081111-5m9q.html


NSW slips into deficit, cuts $3.3b 
Mini-budget fails the test 
November 11, 2008 - 2:33PM 

NSW will raise coal royalties from next year as it looks to shore up its sagging finances.

The state government, in releasing new budget measures on Tuesday, also said it would no longer allow coal-miners to deduct transport costs from the royalty calculation.

From January 1, royalties will rise to 8.2% for open cut mining, from 7% now; to 7.2% for underground mining, from 6%; and to 6.2% for deep underground mining, from 5%.

The NSW government released the new measures after an economic slowdown and big drop in tax receipts forced it to revise its budget for the year to June 2009.

It also said it would sell state assets, including the NSW lottery and a waste-services business, WSN Environmental Solutions, though it gave few details.

NSW accounts for about 10% of Australia's $1 trillion economy and is now planning for a deficit of $917 million for 2008/09 from a previously forecast surplus.

Reuters


----------



## noirua

Hi roland, thanks for the article. Looks as if coal miners are going to need the Aussie$ quite a bit lower, against the US$,  if prices tank with the oil price.


----------



## noirua

noirua said:


> Hi roland, thanks for the article. Looks as if coal miners are going to need the Aussie$ quite a bit lower, against the US$,  if prices tank with the oil price.



From the GlobalCoal reports it seems that markets are looking set for lower prices in the power-station coal market, as India is reported to be searching for coal bargains.
Some companies in Australia have prices set from January 1st 2009 and prices agreed will be interesting.


----------



## noirua

Power-station thermal coal out of the Port of Newcastle fell $6.50 to US$97.52 a tonne, as of Friday 14th November. Well below the benchmark price set on 1st April of US$125 per tonne.
Europe, out of Amsterdam, fell $9.85 to US$94.65 and US prices tanked $11.15 to US$94.50 a tonne.

Exchange rate was AU$0.93 to US$1 on 1st April 08 = (US$125 per tonne) AU$134 per tonne.

Exchange rate was AU$0.65 to US$1 on 14th Nov 08 = (US$97.52 per tonne) AU$150 per tonne.


----------



## noirua

Coal and iron ore suppliers are having to take great care to make sure that a letter of credit is in place before shipping.


----------



## noirua

noirua said:


> Coal and iron ore suppliers are having to take great care to make sure that a letter of credit is in place before shipping.




Coal stocks, and I refer to those mining purely in Australia and selling in or shipping out.
About 3 months ago it was purely a case of getting the coal out of the ground and trying to ship it out for top dollar. 
Now, it's making sure who you send it to is able to pay up or honour prices agreed to 31st March 2009. 
So, it's a case of looking at whether a company will be able to sell its coal and the quality of the company, and indeed, the country it's being sent to.

Iron ore prices have tanked seriously badly and coking coal and PCI coal may dive in price the same way. Even the weak Aussie will not be enough.

Thermal coal will be affected less but PCI coal could be sold by some as thermal. Thus squeezing companies with only thermal coal that is not of good quality, benchmark or better.

On prices, there are guesses all over the place for 2009. Worst case so far is for thermal at US$70 per tonne against US$125 in 2008. So, with the Aussie around AU$1.50 to the US$1 the fall is not that bad.

Semi-soft coke at around US$240 per tonne looks the most vulnerable, and what of semi-hard and hard coking?

Some coal companies have crashed badly and rightly so.  Amongst them are more solid companies with clients having a stake in their mines with long term agreements to purchase coal at market prices. These are safer and now look cheap.


----------



## noirua

A handful of coal producers remain at very low levels despite good yields, low PE's and earning yields. Each have their problems and good points, one debt, three development of mines, and one a possible problem coal mix. Despite this I have taken the risk and added more stock, not a lot, but just a bit more.

Well, my own views on coal prices is more negative on thermal coal than Macquarie Bank, but maybe their estimate is better than my guesses.  They forecast a thermal coal fix for April 09 at US$100 (earlier forecast US$170) per tonne against US$125 at present.  Their forecast is for coking coal at US$140 (earlier forecast US$350 per tonne) per tonne against US$300, quite a fall.

Factoring in the Aussie Dollar fall helps a lot.


----------



## noirua

Thermal coal out of the Newcastle Port (spot for delivery in 3 months) fell heavily to end the week at US$85.69 per tonne, down $10.83.

Thermal out of Europe was at US$85.78 per tonne, down $8.87 and the States at US$79.60 per tonne, down $14.90.


----------



## noirua

noirua said:


> A handful of coal producers remain at very low levels despite good yields, low PE's and earning yields. Each have their problems and good points, one debt, three development of mines, and one a possible problem coal mix. Despite this I have taken the risk and added more stock, not a lot, but just a bit more.
> 
> Well, my own views on coal prices is more negative on thermal coal than Macquarie Bank, but maybe their estimate is better than my guesses.  They forecast a thermal coal fix for April 09 at US$100 (earlier forecast US$170) per tonne against US$125 at present.  Their forecast is for coking coal at US$140 (earlier forecast US$350 per tonne) per tonne against US$300, quite a fall.
> 
> Factoring in the Aussie Dollar fall helps a lot.




I still think Macquarie is over optimistic on thermal coal, but who knows they could be right. Finished buying coal stocks on Friday having reached my limit. Will sit it out now. 
Is the coal sector cheap or is it expensive?


----------



## noirua

noirua said:


> I still think Macquarie is over optimistic on thermal coal, but who knows they could be right. Finished buying coal stocks on Friday having reached my limit. Will sit it out now.
> Is the coal sector cheap or is it expensive?



So far Maquarie are once again behind events in their forecasts on thermal coal prices.

Newcastle Port thermal coal fell to US$78.19 a tonne, down a further US$7.50.
Thermal coal price fix on 1st April 2008 was US$125 per tonne and high was US$194 per tonne.

Some guesses see thermal coal fix in 2009 at US$70 per tonne and semi-soft coke down from US$240 per tonne to US$110 per tonne.

The tanking Aussie Dollar will help but an exchange rate of AU$1.70 to US$1.00 is needed if coal prices continue down.


----------



## noirua

Having tracked a number of coal vessels due to ETA in December at the Gladstone Port. I notice many suddenly disappear from the shipping list, indicating either cancellations or clients requesting later deliveries.

Spot prices continue to tank inline with the oil price tumble, Brent crude at US$48 a barrel to day, and no sign yet of a bottom in thermal coal prices. 

Biggest worry is PCI coal where Macarthur Coal indicated they were prepared to sell this as quality thermal. Semi-soft coke is mainly on 12 month deliveries and is expected to tank badly.

Not forgetting the Aussie fall from AU$1.05 to AU$1.56 to the US$1 that will help a great deal next year, when companies present currency deals end.


----------



## noirua

noirua said:


> So far Maquarie are once again behind events in their forecasts on thermal coal prices.
> 
> Newcastle Port thermal coal fell to US$78.19 a tonne, down a further US$7.50.
> Thermal coal price fix on 1st April 2008 was US$125 per tonne and high was US$194 per tonne.
> 
> Some guesses see thermal coal fix in 2009 at US$70 per tonne and semi-soft coke down from US$240 per tonne to US$110 per tonne.
> 
> The tanking Aussie Dollar will help but an exchange rate of AU$1.70 to US$1.00 is needed if coal prices continue down.



NBSP US coal price for spot thermal, 3 months delivery, was at US$78.10 per tonne, down US$1.50 on 29/11/08.

ARA - Europe coal price for spot thermal, 3 months delivery, fell sharply to US$70.50 per tonne, down $15.28 on 20/11/08.


----------



## noirua

noirua said:


> So far Maquarie are once again behind events in their forecasts on thermal coal prices.
> 
> Newcastle Port thermal coal fell to US$78.19 a tonne, down a further US$7.50.
> Thermal coal price fix on 1st April 2008 was US$125 per tonne and high was US$194 per tonne.
> 
> Some guesses see thermal coal fix in 2009 at US$70 per tonne and semi-soft coke down from US$240 per tonne to US$110 per tonne.
> 
> The tanking Aussie Dollar will help but an exchange rate of AU$1.70 to US$1.00 is needed if coal prices continue down.



NBSP US coal price for spot thermal, 3 months delivery, was at US$78.10 per tonne, down US$1.50 on 29/11/08.

ARA - Europe coal price for spot thermal, 3 months delivery, fell sharply to US$70.50 per tonne, down $15.28 on 29/11/08.


----------



## noirua

Some probably think coalminers are at a rock and a coalface at the moment. Probably due to the sudden turn-a-round and having to get bank letters to be certain clients can pay or being put in the dilemma of accepting delays.

Companies need to have loads of cash and be careful about costs on development and exploration. Must be a producer with good clients preferably with stakes in the mines.

Coal is dropping in price like a stone and thermal may drop 50% (US$62.50 per tonne), with PCI down 55% (US$81) and semi-soft coke coming down 60% (US$96), *imho.*
AU$1.05 fall to AU$1.56 to the US$1.00 helps to some extent.


----------



## drillinto

December 05, 2008

Australian Analysts Accept The Bear Fact That The Coal Price Is Coming Down
By Richard Roberts of Highgrade.net
Source: www.minesite.com


A couple of weeks ago veteran Australian coal analyst Dr Don Barnett nearly choked on his cornflakes when he saw Macquarie Bank had chopped its coking coal price forecast for 2009 by close to 60 per cent. With Merrill Lynch having now added its name to the doomsayers list, Dr Barnett now concedes his reaction to the Macquarie “overreaction” may have been a bit hasty: the managing director of Sydney-based Minec said at a mining conference in the harbour city around a fortnight ago that Macquarie’s expectation that the US$365 per tonne contract price for hard coking coal won by US producers a few months ago would plummet to US$140 per tonne in 2009 was over the top.
“Not everybody expects substantial discounts,” he said at the time. “I’m certainly not forecasting $US140 per tonne coking coal. I’m taking a punt on ... between $US250 to US$280 per tonne ... it doesn’t really matter if the Australian dollar stays around where it is now, it’s a hell of a lot of money. They’re record prices in Australian dollar terms.” 

But Merrill Lynch analyst Vicky Binns said in a research note released last week that steel mill closures and production cuts in Asia and elsewhere were causing metallurgical coal demand to “disintegrate”, and she flagged a reduction of up to 58 per cent in contract hard coking coal prices next year. Semi-hard coking coal prices could drop by 52 per cent to around US$115 per tonne. “Cumulative crude steel production cuts in 2008Q4 sum to 44 million tonnes, 33 million tonnes alone from blast furnace closures,” Binns said. “Annualising 2008Q4 steel output, year-on-year steel production in 2009 would be down 10-15 per cent versus 2008. According to IISI (World Steel Association), October’s global steel output alone was [down] 12.4% year-on-year, with every region declining: US & China down 17 per cent; CIS down 33 per cent. If we annualise forecast Dec-08 crude steel production, 2009 output is down 20 per cent year-on-year. This is NOT our base case for 2009. However, it does appear likely global steel production will be at least five per cent lower vs 2008. Our forecast China’s crude steel production in 2008 is 490 million tones, (flat year-on-year) and 470 milliont tones in 2009.” 

Binns said the bad news on steel output could keep coming. “Look for more announcements relating to steel capacity closures in 2009Q1,” she said. “Over the last three weeks, there have been dramatic changes in the demand outlook for met coal. Coke prices collapsing by 50% for both China’s and export supply; customers have sought to delay or defer shipments of even premium hard coking coal; several Indian mills even hoped to re-negotiate FY09 prices for outstanding tonnage - very unlikely, in our view; or some mills simply not sending ships or answering calls. We expect an extension of a substantial percentage of 2008Q4 global steel cuts into 2009Q1, and therefore we look to much greater demand destruction for met coal than has been evident to date. “While we believe it is too early to accurately forecast coking coal prices, given the enormous volatility in steel production rates (settlement could be as late as May-09), it is clear the negative news is vastly out-weighing positive. Not only is demand growth being hit by the collapse in steel production, but coal export flows remain strong (particularly from Australia, the US). The seaborne supply-demand balance, even for hard coking coal, appears to be moving into surplus.” 

And so Dr Barnett told HighGrade the rapid changes in the market had certainly altered his take on proceedings, although predictions of a 50-60 per cent price cut for hard coking coal in 2009 still looked overdone. “I think it’s still probably a bit of an overreaction, but I’d be less adamant than I was a couple of weeks ago ... because the information just gets gloomier as we go on,” he said. “It’s a difficult thing to argue at the moment because there is a hell of a gap between the current prices, or even US$140 per tonne, and the cost of [most] supply. There’s still a substantial cushion at a low US dollar exchange rate for the Australian producers. So it’s not like the traditional case where you said, well there’s the 90th percentile of supply [cost] and that’s where the price will be. These prices are still above that ... at a A65-70c/US dollar exchange rate.” 

Binns said Australia supplied about 55% of the world’s seaborne met coal. “This lower Australian dollar does impact the cost of production,” she said. “We estimate the average cost of met coal production from Australia to port is about A$70 to A$75 per tonne, which at spot A$/U$ 0.65 is US$45-50 per tonne. A price of US$125 per tonne for hard coking coal would return a cash margin for those average producers of about 55-60 per cent. We estimate cash production costs have continued to rise over the last few years and we believe the average cost of Canadian production FOB is about US$100 per tonne, and for US production [more than] US$110 per tonne FOB US east coast. US exports are up 37 per cent in 2008, as those producers ‘make hay while the sun shines’ with higher prices. We expect some cuts in production from US producers if prices correct to our forecast levels. We find it difficult to believe that there would be any substantial cuts to Australian met coal production in the near-term. We believe it is more likely that any production and export cuts will come from the higher cost US and Canadian producers.” 

However, “deferred shipments are now a reality” for Australia’s coal producers, Binns said, mirroring the situation on the country’s west coast with iron ore. According to Barnett, Queensland’s new “super coal royalty” added to the cost pressures on the state’s coking coal exporters. “If you go back to the US$300 per tonne level, the Queensland royalty is a very significant cost item,” he said. “At say A80c [to the US dollar] – roughly the average for 2008 – it’s a big swag of money ... a bit over A$30 per tonne for the hard coking coal people. So when you come down to a lower price you do get a drop-off in that royalty of A$15 to A$19 per tonne. But the cost element has been increasing. If you come down to US$125 per tonne and the Australian dollar is in the higher 60s [USc], there’s not a lot of cushion then between the higher cost mines and the Australian dollar price. So it is starting to get a bit tight.” And his thoughts now on the contract hard coking coal prices next year? “I still think we’ll be on the upside of US$140 pertonne, but perhaps not substantially on the upside,” Barnett said, after a long deliberation. 

[This article is a slightly modified version of the original, which appeared on Highgrade.net on 1st December]


----------



## noirua

Thermal benchmark coal out of Newcastle for 5th Dec, spot for 3 months delivery, fell $2.10 to US$76.09 per tonne. 

US fell $2.90 to US$75.20; and Europe to US$76.50 up $6.00.  Some European dumping of thermal caused the set back last week.


----------



## noirua

Thermal benchmark coal out of Newcastle for 5th Dec, spot for 3 months delivery, fell $2.10 to US$76.09 per tonne. 

US fell $2.90 to US$75.20; and Europe to US$76.50 up $6.00.  Some European dumping of thermal caused the setback last week.


----------



## noirua

Merril Lynch have upgraded Felix Resources to outperform, downgraded Centennial Coal to neutral, Macarthur Coal to underperform and Gloucester Coal to underperform.


----------



## noirua

noirua said:


> Thermal benchmark coal out of Newcastle for 5th Dec, spot for 3 months delivery, fell $2.10 to US$76.09 per tonne.
> 
> US fell $2.90 to US$75.20; and Europe to US$76.50 up $6.00.  Some European dumping of thermal caused the setback last week.



Slightly better this week, at least the downward trend has stopped, for a moment anyway.
Newcastle thermal rose a tad, just US$2.10 at US$78.25 per tonne. US fell away US$1.02 at US$74.18 per tonne and Europe managed a 61c hop to US$77.11 a tonne.


----------



## pacestick

isnt the small rise related to the small rise in the week of oil and therefore as a trend  is pretty conditional  on what happens with opec and russia trying to shore up  the oil price this week


----------



## noirua

noirua said:


> Slightly better this week, at least the downward trend has stopped, for a moment anyway.
> Newcastle thermal rose a tad, just US$2.10 at US$78.25 per tonne. US fell away US$1.02 at US$74.18 per tonne and Europe managed a 61c hop to US$77.11 a tonne.



Another week and thermal coal prices continue their uncertain path despite Xstrata tieing up an US$80 per tonne agreement for thermal coal out of Australia for 2009.

Thermal coal prices, spot, out of Newcastle for 3 months delivery, fell 44 cents to US$77.81 a tonne.
In Europe, down 11 cents to US$77.00 a tonne and the States, up $6.15 at US$80.33 - the latter somewhat bucking the trend.


----------



## noirua

Vessels loading coal at the Newcastle port are experiencing increased demurrage.  Vessels waiting have risen to 45 and 4 in port.  Average waiting time is 14.03 days and comes as a disappointment after comments on improvements have been made.


----------



## noirua

noirua said:


> Another week and thermal coal prices continue their uncertain path despite Xstrata tieing up an US$80 per tonne agreement for thermal coal out of Australia for 2009.
> 
> Thermal coal prices, spot, out of Newcastle for 3 months delivery, fell 44 cents to US$77.81 a tonne.
> In Europe, down 11 cents to US$77.00 a tonne and the States, up $6.15 at US$80.33 - the latter somewhat bucking the trend.




Coal prices have improved a little to end the year.  Thermal out of Newcastle on 26th Dec 08 rose $2.76 to US$80.56 per tonne.   
Europe recovered from dumping, to be up $5.50 at US$82.50 a tonne.
The US rose 67c to US$81.00 a tonne.


----------



## kransky

can you please point me to where those prices are tracked or documented on the web? i'd like to track it myself too if possible

thanks


----------



## michael_selway

kransky said:


> can you please point me to where those prices are tracked or documented on the web? i'd like to track it myself too if possible
> 
> thanks




http://www.globalcoal.com/







If you buys things at the bottom it could turnout good etc

thx

MS


----------



## kransky

thanks!


----------



## noirua

South Korea have announced they are to build 12 nuclear power plants, 11 natural gas and 7 coal-fired, by 2022.


----------



## gfresh

MCC, CEY, RIV, GCL all rose over 7% (some into double digits) on the last day of the trading year.. anything to be read into this for 09?


----------



## michael_selway

gfresh said:


> MCC, CEY, RIV, GCL all rose over 7% (some into double digits) on the last day of the trading year.. anything to be read into this for 09?




Yeah time tobring outteh list again  Btw any new coal stocks i missed below?

*Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES 

Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*

thx

MS


----------



## noirua

Interesting this coal sector in 2009 that may lead to a few successes at one end and a few failures at the other.

The Aussie$ is a key factor here. If it stays well down then new currency agreements from April 2009 will see thermal producers do quite well. 
Worth checking, sometimes difficult, just how much it costs to produce the coal per tonne. 

If the mine produces coking coal only and is a high cost underground mine, with heavy rail and shipping costs, then the decline will be quite marked.

Some may be developing mines that are costing AU$100 to AU$400 million, whilst profits drop from their producing mines. 

Do your own research they say, in this sector it is critical.


----------



## noirua

noirua said:


> Coal prices have improved a little to end the year.  Thermal out of Newcastle on 26th Dec 08 rose $2.76 to US$80.56 per tonne.
> Europe recovered from dumping, to be up $5.50 at US$82.50 a tonne.
> The US rose 67c to US$81.00 a tonne.




Thermal coal out of Newcastle for 2nd Jan 09, spot, 3 months delivery, fell $1.37 to US$79.19 per tonne. US fell 6c to US$80.94 a tonne and Europe rose $1.16 to US$84.16 a tonne.


----------



## pacestick

This seems to be an unusual slowdown in the world economy back in the recession we had to have  Wrans navy i.e. the ships anchored off newcastle disappeared . I live in Newcastle and i can see a  lot anchored along the coast line waiting to get into port to load .Newcastle Port reports that in the week to 29 December they loaded 25 ships and the waiting time was an average of 13.5 days As of the 29 December there were 45 vessels waiting to load  a total of 3,835,996 tonnes of coal


----------



## Rockon2

michael_selway said:


> Yeah time tobring outteh list again  Btw any new coal stocks i missed below?
> 
> *Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES
> 
> Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD
> 
> Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*
> 
> thx
> 
> MS





Many thanks for posting up these,, I will update my watchlist..

Cheers


----------



## michael_selway

Rockon2 said:


> Many thanks for posting up these,, I will update my watchlist..
> 
> Cheers




NP i think there maybe a few new ipos since i last postedthat list as now looking to get back into the coal sector afterbeing out for a while ;p



















http://www.theaustralian.news.com.au/business/story/0,28124,24820923-643,00.html

Xstrata latest contract locks in coal price plunge



> Matt Chambers | December 19, 2008
> Article from: The Australian
> 
> THE nation's thermal coal exporters could face a 50 per cent drop in contract prices next year.
> 
> This would represent a $9 billion hit to exports, after Swiss mining giant Xstrata rushed to accept a big contract price drop.
> 
> Xstrata, the world's biggest thermal coal exporter, is understood to have locked in $US80 ($114) a tonne contracts with Japanese power companies for the next calendar year -- just half the price it received only three months ago.
> 
> The early agreement comes after Xstrata and Macarthur Coal this week started a round of production cutbacks and worker layoffs in Queensland's previously insulated coking coal industry.
> 
> With oil prices continuing to look shaky, analysts said Xstrata's thermal coal deal did not bode well for other local producers, such as Rio Tinto and Centennial Coal, who will be looking to negotiate contracts for the Japanese financial year, which starts in April.
> 
> It also makes analyst consensus of $US90 a tonne for the full year look too high, though many have been lowering forecasts in recent weeks.
> 
> "Time is against the suppliers in this market -- it is not surprising we are seeing them want to lock in prices quickly," said Mark Pervan, director of commodities research at ANZ in Melbourne.
> 
> Thermal coal contracts were settled at a record $US125 a tonne for this Japanese financial year, and Xstrata in September locked in a 12-month contract at $US155.
> 
> Unlike iron ore and coking coal, which are both used in steelmaking, thermal coal is not strictly contracted on a Japanese financial year basis and contracts can start at different times.
> 
> Prices of thermal coal, used to make electricity, had surged on the back of soaring global energy prices and are now expected to slide as oil prices plunge.
> 
> Customers are still expected to take delivery, and there has been no talk of production cuts. Government forecaster ABARE is predicting coking coal exports of $18 billion this financial year.
> 
> The worsening outlook for coking coal exports was reinforced last night by South Korea's POSCO, the world's fourth largest steelmaker, which announced its first-ever production cut to reduce rising inventory caused by a sharp fall in local demand. POSCO, which produces 2.78 million tonnes of crude steel a month, said it would reduce output by 200,000 tonnes this month 370,000 tonnes next month.
> 
> Merrill Lynch, which forecasts a contract price of $US80 a tonne next year, said the Xstrata deal would probably be seen as a benchmark, though the outlook for coal was not strong.
> 
> "This is a good deal for Xstrata as the thermal market is exposed to several key bear factors, including a ... weak short to medium term global economic outlook, rising coal production in China and weakness in metallurgical (coking) coal markets," Merrill analyst Vicky Binns said.
> 
> The sudden dip in global coking coal markets, with steelmakers this month suddenly calling for deliveries to be deferred, is expected to flow through to thermal coal.
> 
> Many coking coal mines have areas of thermal coal available if customers do not want the higher-quality hard coking coal.
> 
> Semi-soft coking coal can also be sold as thermal coal. Felix Resources managing director Brian Flannery said his company could start mining thermal coal instead of coking coal if steel mills could not take contracted volumes. He said there were no plans to do so, and there had been no requests for deferrals, but company representatives were in talks with Japanese steel mills about future needs.
> 
> ANZ's Mr Pervan forecasts contract prices of $US75 a tonne for the Japanese fiscal year. However, the slide in oil prices could drive this lower, he said.
> 
> Goldman Sachs JBWere this week dropped its forecast from $US90 a tonne to $US70.




thx

MS


----------



## pacestick

an. 5 (Bloomberg) -- Power-station coal prices at Australia's Newcastle port, a benchmark for Asia, slipped 1.7 percent last week as the number of ships waiting to load the fuel fell after higher-than-expected shipments in December.

The weekly index for power-station coal prices at the New South Wales port dropped $1.37 to $79.19 a metric ton in the period ended Jan. 2, according to the globalCOAL NEWC Index. The measure has risen from $76.09 a ton on Dec. 5, the lowest in almost 14 months.

Prices have fallen about 60 percent from the $194.79 a ton record reached in the week ended July 4 last year because of declining demand and lower crude-oil prices. Bottlenecks at Australian ports contributed to record prices last year as supplies were constrained to customers in Asia.

The number of ships waiting to load at Newcastle should fall to 19 by mid-January, from 30 at the end of December, the Hunter Valley Coal Chain Logistics Team, which coordinates coal movements to and from Newcastle, said on its Web site. The queue has fallen from 45 earlier in December, which was the most in a year.

The performance rates in December for the assembly of cargoes at Newcastle and their loading onto ships were both above target, the group said.

Xstrata, BHP

Xstrata Plc, the world's largest exporter of power-station coal, BHP Billiton Ltd. and Rio Tinto Group are among mining companies that ship coal through Newcastle. Zug, Switzerland- based Xstrata has been forced to accept a cut in prices for annual calendar-year contracts for the fuel with Japanese utilities, Citigroup Inc. and Merrill Lynch & Co. said Dec. 17.

Twenty-five coal ships left Newcastle in the week ended Jan. 3, one less than a week earlier, Newcastle Port Corp. said today in an e-mailed report. Sixteen of the vessels were headed for Japan, two each for South Korea and Taiwan, and one each for Mexico, China, Malaysia, France and Western Australia's Fremantle.

The monthly Newcastle thermal coal price index fell 14 percent to $78.18 ton in December, from $91.36 the previous month, according to globalCOAL. It was the lowest since October 2007. The January Newcastle coal futures contract closed Jan. 2 at $74.35 a ton, down 1.7 percent, on London's ICE Futures Europe exchange.

The volume of coal transported to Newcastle for export rose 8 percent last year to 91.4 million tons, while the volume loaded onto ships advanced 7.5 percent to 92 million tons, the Hunter Valley Coal Chain Logistics Team said in its end- December report.


----------



## J.B.Nimble

Slightly old news (must have been preoccupied on New Years eve...)



> (INTERFAX-CHINA)
> Updated: 2009-01-04 09:05
> Counter:123
> 
> Chinese  coke producers are earning  profits again now that demand has rebounded amid relatively low coking coal prices, a coal analyst told Interfax on Dec. 31.
> 
> 
> Ma Xiaoguang,  a  coal  analyst  with  metal  information portal Umetal, estimated  that  coke  producers  are  earning profits of between RMB 50($7.31) and RMB 100 ($14.62) per ton.
> 
> 
> The market  price  of  coking  coal,  the  main  raw  material  in  coke production,  is  sitting  at about RMB 1,200 ($175.44) per ton, which is around the  same  price  level  of  coking coal at the beginning of this year, Ma said.
> 
> Coking coal prices peaked at the end of July at RMB 2,200($321.64)  per ton. Annual contract prices for coking coal are about the same as  current  market  prices,  though  contract  prices  are usually adjusted every quarter.
> 
> 
> Meanwhile,  coking  coal  companies  are  offering  discounts of RMB 200($29.24)  per  ton  to  some steel mills in southern China that purchase coking coal directly, Ma said.
> 
> 
> Coke producers  have also benefited from an upsurge in downstream demand as a number  of  small-sized  steel  mills  resumed  production  at  the beginning of December in response to growing demand for steel.
> 
> 
> The situation  suggests that coke demand grew in December, which in turn caused coking coal prices to rebound recently, Ma said.
> 
> 
> Coke prices  in  Shanxi Province, China's largest coke producing region, rose to  between  RMB 1,500 ($219.30) and RMB 1,600 ($233.92) per ton as of Dec.  30,  up from RMB 1,100 ($160.82) to RMB 1,300 ($190.06) per ton on Dec. 1, according to Umetal.




I like the suggestion that coking coal prices have started to rebound. The world hasn't stopped after all...


----------



## noirua

J.B.Nimble said:


> I like the suggestion that coking coal prices have started to rebound. The world hasn't stopped after all...




Part of the struggle, will be whether certain types of coal can or cannot replace others. Semi-soft coke and PCI coal can replace thermal coal and some suppliers may take the opportunity to unload it at thermal prices.


----------



## noirua

Most coal stocks have rebounded, rising up to 100% from their low point. Most are still at a third or less of their 2008 highs.
Profit forecasts for year ending 2009 are set to tumble and again for 2010.
It will be during 2009 that they come out of the melting pot, mostly after June 30th year end trading finishes.


----------



## roland

noirua said:


> Most coal stocks have rebounded, rising up to 100% from their low point. Most are still at a third or less of their 2008 highs.
> Profit forecasts for year ending 2009 are set to tumble and again for 2010.
> It will be during 2009 that they come out of the melting pot, mostly after June 30th year end trading finishes.




Gee I wish that the rebound were true of MCC. Still stuck around the $3.00 mark. There is probably enough intra-day to trade, but I'm still shell shocked with MCC - bottom draw right now. mmmm, my bottom draw is not a pretty site


----------



## noirua

roland said:


> Gee I wish that the rebound were true of MCC. Still stuck around the $3.00 mark. There is probably enough intra-day to trade, but I'm still shell shocked with MCC - bottom draw right now. mmmm, my bottom draw is not a pretty site



After that major backtrack on profits and dividends at Macarthur, confidence in the board of directors is seriously in doubt. Wouldn't be surprised to see the major holders put the pressure on now, some need tipping.


----------



## noirua

Most Aussie coal companies will give a quarterly report for their second quarter in the next 3 weeks and a half yearly report during February.

The quarterly report will give some clues as to how steep coal sales dropped off.

The other factor will show the extent of companies switching to thermal coal, if they can, and the extent of delays for PCI coal, semi-soft coke and semi-hard to hard coke.

The affect is expected to be dramatic on PCI and coke. But far less so on thermal coal, especially thermal sent in single ships, all from the same mine that is.


----------



## michael_selway

noirua said:


> Most Aussie coal companies will give a quarterly report for their second quarter in the next 3 weeks and a half yearly report during February.
> 
> The quarterly report will give some clues as to how steep coal sales dropped off.
> 
> The other factor will show the extent of companies switching to thermal coal, if they can, and the extent of delays for PCI coal, semi-soft coke and semi-hard to hard coke.
> 
> The affect is expected to be dramatic on PCI and coke. But far less so on thermal coal, especially thermal sent in single ships, all from the same mine that is.




Yes it will be good to see some of the results soon, and a few companies may surprise on the upside













thx

MS


----------



## gfresh

Some are sitting with a P/E under 5 that have already re-affirmed their profit guidance  You'd expect some reasonable falls in profit over the next year or two, but 50% is a little extreme.. 

To be honest I don't quite understand why many of the mainly Thermal producers are trading already as if their profits will halve.. many have contracted a lot of their production for 6-24 months at the old prices. This should keep profits at least reasonable, until the worst of this downturn has hopefully passed.


----------



## noirua

gfresh said:


> Some are sitting with a P/E under 5 that have already re-affirmed their profit guidance  You'd expect some reasonable falls in profit over the next year or two, but 50% is a little extreme..
> 
> To be honest I don't quite understand why many of the mainly Thermal producers are trading already as if their profits will halve.. many have contracted a lot of their production for 6-24 months at the old prices. This should keep profits at least reasonable, until the worst of this downturn has hopefully passed.



Some of the coal mining stocks include profits from sales of assets in their profits for 2008.  In the current year this opportunity is unlikely to be available.  A few have quite heavy loan arrangements or commitments to explore or develop further mines.
There are additional concerns, that some mines may have to be mothballed or face a few lower cost open-cut mines coming onstream and pricing them out.
Many mining companies are having to delay shipments on requests or because the buyers bank cannot guarantee payment.

There are many mines where Chinese, South Korean and Japanese companies have stakes. In these cases there are coal agreements to purchase a certain amount of coal each year. These mines are safer than the ones that are 80% to 100% owned (excluding FLX's Moolarben project that has all coal for their open-cut mines sold for 25 years in advance).


----------



## noirua

Benchmark thermal coal prices out of Newcastle Port, spot for 3 months delivery:
22nd January - US$88.36
21st January  - US$87.73
20th January  - US$85.79 
19th January  - US$85.98
18th January  - US$81.46


----------



## noirua

noirua said:


> Benchmark thermal coal prices out of Newcastle Port, spot for 3 months delivery:
> 23rd January - US$88.19
> 22nd January - US$88.36
> 21st January  - US$87.73
> 20th January  - US$85.79
> 19th January  - US$85.98
> 18th January  - US$81.46




Macquarie have down graded their Hard coking coal price to US$110 per tonne, down from highs of US$300 per tonne.

Forecast for thermal coal (6080 K/cal) is now US$75 per tonne agains a high of US$194 per tonne and last years Japan new year fix at US$125 per tonne.


----------



## J.B.Nimble

Mixed blessings in this story. Positive is China power industry turning attention to Australian coal, negative is the weak electricity demand.
From today's China Daily...

China's major power generating companies are planning to buy more coal from overseas markets, as high domestic coal prices have cut their profit margins significantly. 

The country's main power generators, including China Huaneng Group, China Datang Corp, China Guodian Corp, China Huadian Corp, China Power Investment Corp and China Resources Power Co, are contacting coal producers in other countries. They're planning to hold a conference for coal contracts after the Chinese Lunar New Year, celebrated on Jan 26, reported China Times, citing an executive with one power company. 

"We are now talking with coal companies in Australia, Indonesia, Russia and Mongolia to secure stable coal supply," said the executive, who declined to be named. 

In the first half of 2008, the sharp rise in domestic coal prices put many power companies into the red. 

Xue Jing, director of the statistics department at the China Electricity Council, earlier told China Daily that China's power companies may incur 70 billion yuan losses in 2008 due to rising fuel costs and lackluster electricity demand. 

"Although now the coal price has seen a sharp drop compared with last summer, we are still under big pressure," one source with China Huaneng Group told China Daily. 

He said in past years Huaneng has imported some coal from foreign companies, but the amount was "not very big". 

The company is now considering some investments in overseas coal mines, such as in Australia, he said. 

To cope with the rising prices of raw material, Huaneng is eyeing abundant coal reserves in western China to increase its coal production, he said. For instance, the company plans to take part in some coal projects in Shaanxi, Ningxia and Xinjiang. 

China's leading power companies have failed to reach an agreement with coal miners on coal supply contracts in 2009 as they are unwilling to concede to the miners' demands for higher prices. 

Coal companies were set to sell 840 million tons to power producers at the annual coal contract negotiations. However, only about half of the coal offered by the miners was sold, said an official with China Coal Transport and Distribution Association, who declined to be named. 


(China Daily 01/24/2009 page10)


----------



## noirua

Benchmark thermal coal out of the Newcastle Port fell on Monday to US$83.88 a tonne, down $4.33 since Friday.

Coal negotiations for the year starting 1st April 09 may be proving difficult and parties may fall inline with a 3 monthly agreement, similar to iron ore price discussions.


----------



## michael_selway

noirua said:


> Benchmark thermal coal out of the Newcastle Port fell on Monday to US$83.88 a tonne, down $4.33 since Friday.
> 
> Coal negotiations for the year starting 1st April 09 may be proving difficult and parties may fall inline with a 3 monthly agreement, similar to iron ore price discussions.




It will be interesting to see what happens from here



















thx

MS


----------



## noirua

The outlook for Japan and China does now look quite serious.  Many coal companies will get by just because of the tanking Aussie$ and hope it gets lower and lower.

Too many seem to be banking on a pickup in the second half of 2009 in the metallurgical coal market and getting by selling more thermal coal. 
What if there is little improvement and signs of dumping coal by desperate companies?

Only those with good cash reserves and low cost open-cut mines are likely to do well if markets fail to improve.


----------



## noirua

Start Date 	  	End Date

ICE globalCOAL Newcastle Index
open methodology
globalCOAL Newcastle Index
The week-to-date and month-to-date index values are calculated by globalCOAL on each globalCOAL business day, full details on the methodology are available here.


close
ICE globalCOAL Newcastle Index
Date 	Week-To-Date Price 	Month-To-Date Price 	
January 26, 2009 	83.88     	82.83     	 
January 27, 2009 	83.63     	82.78     	 
January 28, 2009 	83.25     	82.71     	 
January 29, 2009 	82.94     	82.64     	 
January 30, 2009 	83.15     	82.69     	 


The globalCOAL Newcastle Index values are calculated and supplied daily by globalCOAL. The Indices are a representation of week to date or month to date prices, calculated from the globalCOAL Newcastle Index traded on globalCoal, and are not calculated from futures activity traded on ICE.


----------



## noirua

A fall this week from US$83.15 a tonne to finish at US$78.17 per tonne, for thermal coal, spot, 3 months delivery out of Newcastle Port.


----------



## noirua

Feb. 5 (Bloomberg) -- Some power station coal producers from Australia have agreed contract prices with South Korean utilities, the Tex report said, without citing anyone.

Contract prices for six-month and one-year contracts were set at between $70 and $73 a metric ton, excluding freight costs, Tex said. Some South Korean utilities have modified contracts to start in January, April or August, similar to agreements reached by Japanese utilities, it said.

Thermal coal suppliers from Australia last year set contracts with Korean utilities at about $65, Tex said. Japanese buyers, which settled contracts later, paid $125 a ton, it said.

Annual price talks between Australian suppliers and Japanese utilities will start by the middle of this month, it said. Xstrata Plc, BHP Billiton Ltd. and Rio Tinto Group are among mining companies that ship thermal coal from Australia.

To contact the reporter on this story: Jesse Riseborough in Melbourne at jriseborough@bloomberg.net
Last Updated: February 4, 2009 17:26 EST

Bloomberg.comNEWS | MARKET DATA |


----------



## noirua

KOSPO and other Korean companies are reported to be tendering for (KOSPO tendering for 500,000 tonnes)  thermal coal prior to discussions for price agreements starting shortly.
This tendering in advance may put pressure on agreements at lower levels from 1st April '09.
Prices were fixed at US$125 per tonne to 31st March '09.
Prices around US$75 per tonne are being paid, without shipping costs, as companies are making their own shipping arrangements.

As a guide line: Exchange rate was AU$1.07 approx on 1st April '08 and stands at AU$1.50 at 10th Feb '09, against the US$1.


----------



## dirty_harry

US70-US80 is low but still profitable for our companies, reporting cost of production around AUD75.

If this is the low for the crisis then our producers will be fine, and if/when the recovery comes and the met coal demand picks back up there will be very large upside in the share prices imo. 

I'm pretty sure oil has bottomed and hopefully coal too.


----------



## noirua

dirty_harry said:


> US70-US80 is low but still profitable for our companies, reporting cost of production around AUD75.
> 
> If this is the low for the crisis then our producers will be fine, and if/when the recovery comes and the met coal demand picks back up there will be very large upside in the share prices imo.
> 
> I'm pretty sure oil has bottomed and hopefully coal too.



Looking at reports in the States and Europe it does look as if oil and coal will stay under pressure.  On the coal front the second stage of the coal price game is being played out right now, where customers try to fix orders at low prices before the official fix from 1st April '09. 

If the oil price moves to US$30 per barrel then a thermal coal price between US$55 - US$60 per tonne could be the spot range by June '09.

Some mines will stay profitable at US$55 per tonne but the squeeze on some deeper mines may prove too much. Thus the third stage will begin.

Some low cost PCI and semi-soft coal producers, who are willing to sell their product as high value thermal coal, may drive some other mines to be mothballed. 
Felix Resources very low cost thermal mine at Moolarben will eventually produce 13mtpa and later on 16mtpa and further exasperate a tight situation.


----------



## dirty_harry

noirua said:


> Looking at reports in the States and Europe it does look as if oil and coal will stay under pressure.  On the coal front the second stage of the coal price game is being played out right now, where customers try to fix orders at low prices before the official fix from 1st April '09.
> 
> If the oil price moves to US$30 per barrel then a thermal coal price between US$55 - US$60 per tonne could be the spot range by June '09.
> 
> Some mines will stay profitable at US$55 per tonne but the squeeze on some deeper mines may prove too much. Thus the third stage will begin.
> 
> Some low cost PCI and semi-soft coal producers, who are willing to sell their product as high value thermal coal, may drive some other mines to be mothballed.
> Felix Resources very low cost thermal mine at Moolarben will eventually produce 13mtpa and later on 16mtpa and further exasperate a tight situation.




Yes interesting. The key I think is the met coal. Many shipments have been pushed back currently putting more pressure on the thermal market. 

Interesting report by Arcelor Mittal. They say they expect steel shipments to increase in the second quarter, as inventories are running down at the moment. They stopped dead all coal shipments around October and since then have been running off inventories. Also they made a large writedown on their current coal contracts, ie they will still take the deliveries from companies like Macarthur who they have contracts with. They're just delayed for now.

Met Coal is Australia's largest export by a long way, then Iron Ore and Thermal Coal second and third. If the coal prices do tank for a long period, then it would be reasonable to expect the Aussie dollar to go lower offsetting some of the effect.


----------



## noirua

dirty_harry said:


> Yes interesting. The key I think is the met coal. Many shipments have been pushed back currently putting more pressure on the thermal market.
> 
> Interesting report by Arcelor Mittal. They say they expect steel shipments to increase in the second quarter, as inventories are running down at the moment. They stopped dead all coal shipments around October and since then have been running off inventories. Also they made a large writedown on their current coal contracts, ie they will still take the deliveries from companies like Macarthur who they have contracts with. They're just delayed for now.
> 
> Met Coal is Australia's largest export by a long way, then Iron Ore and Thermal Coal second and third. If the coal prices do tank for a long period, then it would be reasonable to expect the Aussie dollar to go lower offsetting some of the effect.



Quite a problem though if the Aussie$ strengthens and coal prices continue on down.
It looks as if China, Japan and South Korea are going to need between 30% and 40% less metallurgical coal this year. This means China may need no more metallurgical coal and will export thermal.

As you infer, companies must take metallurgical coal due under contract to 31st March. This should mean deliveries in April, May and June as companies are able to take it. 
Looks horrendous for agreements from April 1st as most customers will be those with stakes in the mines, leaving others out in the cold.


----------



## dirty_harry

noirua said:


> Quite a problem though if the Aussie$ strengthens and coal prices continue on down.
> It looks as if China, Japan and South Korea are going to need between 30% and 40% less metallurgical coal this year. This means China may need no more metallurgical coal and will export thermal.
> 
> As you infer, companies must take metallurgical coal due under contract to 31st March. This should mean deliveries in April, May and June as companies are able to take it.
> Looks horrendous for agreements from April 1st as most customers will be those with stakes in the mines, leaving others out in the cold.




Yes if the AUD does strengthen it will be a problem. It's possible, but if the value of coal exports plunge our balance of payments will blow out. State and Federal Government royalties will plunge creating budget deficits there too. This would be negative for AUD. 

A couple of other points to think about:

- If you look at BHP's profits I think around a third is from coal. Then there is Iron Ore and Nickel, etc. So although it's diversified it's pretty well dependent on the Steel industry. BHP is down less than half but some of the pure coal companies are down 80%. So I see more value there.

- RIO, Macarthur etc have already cut production and made layoffs due to the downturn. If companies like Macarthur put themselves half to sleep (they can because they have no debt) until the recovery comes, then I'm happy to hold. Owning reserves in the ground is like holding Gold. No dividends but a good store of value. 

- The Baltic Index is up from it's lows, so the recovery in Asia may be earlier than everyone thinks. If not then I'm patient. That's my opinion.


----------



## noirua

Newcastle Weekly Coal Exports Fall 25%; Queue of Ships Declines
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a7LTaubPS6aY


----------



## noirua

Thermal coal spot prices continued to sink out of Newcastle Port.  Price fell on Monday to US$73.38 a tonne down from US$78.64 a tonne on the 17/2/09.

1/4/2008 - Price fix for benchmark thermal was US$125 per tonne (AU$134 per tonne).
Spot 23/2/2009 was US$73.38 (AU$106 per tonne).


----------



## noirua

noirua said:


> Thermal coal spot prices continued to sink out of Newcastle Port.  Price fell on Monday to US$73.38 a tonne down from US$78.64 a tonne on the 17/2/09.
> 
> 1/4/2008 - Price fix for benchmark thermal was US$125 per tonne (AU$134 per tonne).
> Spot 23/2/2009 was US$73.38 (AU$106 per tonne).



Quite a fall for Newcastle thermal coal to US$62.38 a tonne (AU$99 per tonne, as of posting) on 2nd March.  Discussions are now taking place for prices on 1st April and forecasts for a price between US$70 - US$75 now look overly optimistic.


----------



## noirua

noirua said:


> Quite a fall for Newcastle thermal coal to US$62.38 a tonne (AU$99 per tonne, as of posting) on 2nd March.  Discussions are now taking place for prices on 1st April and forecasts for a price between US$70 - US$75 now look overly optimistic.



With thermal coal prices moving to US$61.70 per tonne (AU$96.60 per tonne) the ongoing talks with Japan could prove very difficult indeed. Coal prices in America and Europe are between US$56 to US$58 per tonne.

This factor may well put the Aussie under further pressure.


----------



## Nero64

Remember the good ol' days - April/May 2008 when you could put your money on an explorer and make a quid. 

Ahhh memories!


----------



## gfresh

yup .. $couple of thousand in a few minutes  I miss those days, they were easy, even I was making good money ! I doubt we will see that for another 10 years. Back on topic though... 

*Looks like the benchmark price for thermal coal is due to be settled around $US70-$72/tonne this year.* This will have a massive effect on the QLD, and also to some extent the NSW State Budgets over the next 12 months.

http://www.businessspectator.com.au...44-pct-annual-price-cut-tr-PZDA7?OpenDocument



> Xstrata, Rio agree to 44% coal price cut with Japan's Chubu
> 
> By Fayen Wong and Osamu Tsukimori of Reuters
> 
> PERTH/TOKYO - Xstrata and Rio Tinto Ltd have sealed thermal coal contracts with Japan's Chubu Electric for fiscal year 2009/10 at prices as much as 44 per cent lower than a year earlier, coal traders familiar with the negotiations said.
> 
> The first major price deal between big Australian coal miners and the Japanese utility, their main customers, normally sets the tone for further negotiations for contracts that cover the April to March Japanese fiscal year, affecting power plant costs and miners' revenues for the year.


----------



## noirua

An article from Fnarena casts Macquarie, BA-Merrill Lynch, UBS and Citi's views on the future of prices of coal going forward and opinions on BHP Billiton, Felix Resources, Macarthur Coal, Centennial Coal and Gloucester Coal:  http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=F83A7E68-1871-E587-E176905C8FCE8BF0


----------



## noirua

Newcastle Port waiting times for coal cargo is now down to 4.45 days and there are 15 ships waiting.


----------



## noirua

Thermal coal prices have continued to weaken at the Newcastle Port for spot prices. Tuesday price closed at US$60.59 a tonne, slipping 91c from Monday. Spot price is now 52% ( 31% in Aussie$ terms) down on the 1/4/2008 fix.


----------



## noirua

BHP are said to have agreed hard coking coal prices between US$115 - US$125 per tonne from 1st April '09  (down from US$300 per tonne last year).

POSCO have announced an agreement to buy PCI coal at US$90 per tonne from 1st April '09, down 63% on last year.


----------



## noirua

The coal sector may well get a lift from the G20 agreement as weaker economies should be inline for bailouts.


----------



## michael_selway

noirua said:


> The coal sector may well get a lift from the G20 agreement as weaker economies should be inline for bailouts.




Hi Noirua, which coal companies do you like at current prices? 




















thx

MS


----------



## noirua

michael_selway said:


> Hi Noirua, which coal companies do you like at current prices?
> 
> MS



Hi m_s, "present prices", that's the problem after the recent run up. In fact, I can't find any "producer" that does not look reasonable at the present time, in the coal sector. Cheers noi


----------



## noirua

noirua said:


> Hi m_s, "present prices", that's the problem after the recent run up. In fact, I can't find any "producer" that does not look reasonable at the present time, in the coal sector. Cheers noi



Gloucester Coal are in a bid situation and Macarthur Coal have run up on stake building. Centennial and Whitehaven Coal look interesting. Felix Resources have come up on confident rhetoric from the companies MD on profitability at the Moolarben Mine, that is on track to produce in the spring of 2009.
Pike River Coal are undertaking a rights issue to raise $41 million. If successful, they are also interesting on present hard coke deals by BHP.
High risk is the name of the game in the exploration sector and only risk capital should be used.


----------



## noirua

More low key cheery news in the coal sector as prices for PCI coal are agreed at around the US$90 per tonne level.
Thermal coal continues its worldwide pickup in the last 5 days to finish at US$64.15 per tonne out of Newcastle, up $3.36 on the day.


----------



## pacestick

further upward pressure on coal prices from the low after the october collapse

http://www.theaustralian.news.com.au/business/story/0,28124,25457370-5005200,00.html


----------



## pacestick

peak coal in our lifetime

http://www.miningcoal.com.au/Article/Quick-fix-to-coal-emissions-run-out-of-coal/481542.aspx


----------



## noirua

Coal prices are still being affected by dumping of coal on to the spot market. 
Thermal coal prices have been set for some supplies at US$70 - US$72 per tonne and PCI coal at US$90 per tonne. Unfortunately, many supply contracts for PCI coal have been cancelled, RIO's Hismelt, W.A. smelter being one, for example. This has left companies with a lot of PCI coal finding its way on to the QLD spot market as thermal coal.

In these markets it will be the low cost open-cut mines that prosper and some longwall mines. 
The Aussie has strengthened from around AU$1.55 to the greenback to around AU$1.32.  Any further strengthening may cause some mines to be mothballed.


----------



## noirua

noirua said:


> Gloucester Coal are in a bid situation and Macarthur Coal have run up on stake building. Centennial and Whitehaven Coal look interesting. Felix Resources have come up on confident rhetoric from the companies MD on profitability at the Moolarben Mine, that is on track to produce in the spring of 2009.
> Pike River Coal are undertaking a rights issue to raise $41 million. If successful, they are also interesting on present hard coke deals by BHP.
> High risk is the name of the game in the exploration sector and only risk capital should be used.



So far so good as ASF members, following coal, see big profits from the above. Thermal coal is pushing on hard, up 20%+ on spot markets, as confidence returns with a big rush. China is buying PCI coal on the spot markets that is helping QLD miners out of a hole.
Take care now!


----------



## Nero64

> Thermal coal is pushing on hard, up 20%+ on spot markets, as confidence returns with a big rush.




Hi Noirua, 

Is there a link or website where you can see daily spot prices for free. I know Reuters have some info but I couldn't find daily prices.


----------



## noirua

Nero64 said:


> Hi Noirua,
> 
> Is there a link or website where you can see daily spot prices for free. I know Reuters have some info but I couldn't find daily prices.



Hi Nero64, This link will take you in through the back door: http://www.theice.com/marketdata/getGlobalCOALIndex.do?reportCategory=Indices&reportType=Newcastle


----------



## noirua

A surprising turnabout for the coal sector with thermal coal at US$73.82 a tonne and the whole sector amazingly bullish. The rebound appears a bit overdone and there could be profit taking as coal prices are still well down on the US$125 per tonne set last year and the high point of US$194 per tonne. Yes, the Aussie is also down at around AU$1.24 to the green back compared to AU$1.04: But this is not low compared to the AU$1.55 quite recently.


----------



## sidious

What's the outlook for thermal coal? Based on the link posted above, the price is on a downhill / correction pattern? If I google thermal coal, it's saying the demand is strong. It's just confusing. 

Anyone here in ASF still bullish on coal?


----------



## michael_selway

sidious said:


> What's the outlook for thermal coal? Based on the link posted above, the price is on a downhill / correction pattern? If I google thermal coal, it's saying the demand is strong. It's just confusing.
> 
> Anyone here in ASF still bullish on coal?













Well if you look atthe above futures, long term looks on the up






However cant see if it can reach the peak we had in Jul08

thx

MS


----------



## noirua

Coal is listed in this article as amongst the six hottest commodities. http://thebull.com.au/articles_detail.php?id=4059


----------



## noirua

Due to Chinese demand for metallurgical coal the build up of ships waiting outside the Newcastle Port has risen to 47 waiting to load 3.8 million tonnes, the highest since 24/12/2007.  The waiting time average is 11.7 days.


----------



## noirua

A lot of nervousness around in both the coal and iron ore sector.  The RIO execs held for alleged spying has provoked a rift in Aussie/ China relations.  This could well lead to a tit for tat round of politics affecting shipping to China.


----------



## noirua

New Warning of NSW mine closures under emission reduction laws.

The new report - Brisbane Energy Publishers - suggests that 11 coal mines in NSW could be forced to close in the face of Federal Government climate changes response legislation.

The report tabled in the NSW Parliament says Camberra's planned carbon emissions reduction laws will threaten high-gas-content coalmines in the Southern coalfields and in the Hunter Valley - as well as the Port Kembla Steelworks.


----------



## pointr

Hi noirua, I've read the newspaper reports referring to that article. If there is one thing the ALP likes more than 'touchy feely' environmental policies it is getting reelected. Pt Kembla,Wollongong and the Hunter ALP heartland. I really hope that NSW industry is not crippled and thousands thrown out of work  by the maybe's of human impact on climate change. I am 'pro environment' so lets do some real things like not tipping our sewage in the ocean in a country that is mainly desert and lets reaforrestate marginal farmland. I'm sure China wont be shutting its steelworks or any of its mines. I've also read recently where Spain lost 2 'old energy' jobs for every one created by green energy. Coal-where to now? Bloomberg this morning is reporting BHP looking for partners for further coal port expansion in Newcastle. A bit of a jumbled post, apologies, I tend to treat the newspaper reports mentioned above as putting out a feeler


----------



## noirua

pointr said:


> Hi noirua, I've read the newspaper reports referring to that article. If there is one thing the ALP likes more than 'touchy feely' environmental policies it is getting reelected. Pt Kembla,Wollongong and the Hunter ALP heartland. I really hope that NSW industry is not crippled and thousands thrown out of work  by the maybe's of human impact on climate change. I am 'pro environment' so lets do some real things like not tipping our sewage in the ocean in a country that is mainly desert and lets reaforrestate marginal farmland. I'm sure China wont be shutting its steelworks or any of its mines. I've also read recently where Spain lost 2 'old energy' jobs for every one created by green energy. Coal-where to now? Bloomberg this morning is reporting BHP looking for partners for further coal port expansion in Newcastle. A bit of a jumbled post, apologies, I tend to treat the newspaper reports mentioned above as putting out a feeler




Hi pointr et al, That "...putting out a feeler" point quite often comes from Govt as well. Sometimes they are not sure what they can easily do and know MDs and CEOs of companies are going to kick up one hell of a fuss to find out what mines are on this ideas list for closure.

The QLD Govt and NSW Govt know there are a lot of better coal mines out there and getting rid of the bad ones wont concern them much. The Govt deals on the new coal mines are far better for them than many of the old ones.

With the further expansion of the Newcastle Port on the cards it looks as if the Anglo/Swiss Xstrata will want a chunk of that. Some of the smaller miners in the first expansion, WHC, MCC, GCL, CEY and FLX may well drop out after their involvement in the first expansion.


----------



## noirua

My own feelings are now very bullish for the coal sector - a lot of research needed with talk of some high gas producing coal at certain mines putting their whole mine on the line. 

If talk of continuing demand from China and Asia for thermal coal and particularly semi-soft coke and maybe good quality PCI coal as well. We can look for a rerating for the better companies in the sector.
Watch out however for those companies having takeover rumours or hangovers surrounding them. Gloucester Coal, Whitehaven and Felix Resources for instance. That doesn't mean you should wholly avoid them though.


----------



## noirua

The queue of ships outside the Newcastle port has risen to 48, whilst coal shipped fell 5%.  Waiting to load 3.9 million tonnes of coal, up from 2.05 million a week ago. Ships are now having to wait 14.2 days, up 1.5 days from a week ago.


----------



## noirua

China Coal Stocks Soar over June '09 Data :http://www.tradingmarkets.com/.site/quotescharts/news/


----------



## noirua

Merrill forecast for thermal coal (Newcastle Port benchmark) has been raised for Japanese year ending March 31st 2011 to US$85 from US$80:  http://www.bloomberg.com/apps/news?pid=20601116&sid=a0vwY4WEWIsg


----------



## pacestick

The chinese are reopening mines closed due to accidents.
17 August 2009 

_AUSTRALIAN coal miners are nervous that the recommencement of mining in Shanxi, China will stifle demand for Australian coking and thermal coal.

On 14 August 2009, news hit that idle mines in the province would be re-opened and were expected to produce an extra 150 million tonnes in the second half.

Many of the mines were closed due to a spate of mining accidents. This meant Chinese imports of coking coal, mostly from Australia, surged to about 4.6 million tonnes in June 2009, up about 50% from May 2009. 
_
_But now Australian coal miners are nervous that exports will plummet once again, knowing that China, the world's biggest coal producer, is capable of swamping the market.
ANZ head of commodities research Mark Pervan says that second-half coking coal demand from China is being underestimated by the market. Pervan believes the stimulus package will produce strong demand._

meanwhile Industry sources are concerned that the proposed takeover of FELIX will lead to further chinese purchases and influence in the industry some are picking cey as the next candidate
18 August 2009 Print this article Comments Share this article

_INDUSTRY angst surrounding the takeover of Australian resources by Chinese Government-owned businesses continues to grow following the takeover of Felix Resources.

The coal mining company has recently been taken over by Yanzhou.
Analysts are suggesting that if the takeover is approved, it could be the first of many similar acquisitions by China.

There is also concern that this could force the disappearance of Australia's independent coal producers and put the Chinese in a position to start influencing coal pricing._
  news inserts sourced from www. miningcoal.com.au


----------



## noirua

Thermal coal out of the Newcastle port plunged to US$67.63 a tonne on Tuesday. This following the reopening of mines in China.  This overhang and talk of China unloading thermal coal on to markets looks to be a bearish factor to weigh down on to the coal sector.
Should the thermal coal price fall below US$60 a tonne, many deeper and far off mines will be rendered unprofitable.
Sector looks fraught with difficulties in the coming months.


----------



## noirua

Thermal coal prices out of the Newcastle Port have continued their slide this week.  On 10th August the price stood at US$76.13 per tonne and at 4th September at US$66.30 per tonne.

A thermal coal exporter, together with strengthening of the Aussie, with sales at 5 million tonnes per annum would see a fall in profits of AU$75 million.
Most miners will have have taken the money market option of fixing the rate against the dollar at the time of agreements of forward sales, to the sum involved. The better quality miners will have offset a lot of this in the run up to March 2010. Worth checking those Annual Results and Quarterly Reports.


----------



## pacestick

FAT Prophets says the 25% drop in the Shanghai Index since May 2009 is no cause for concern for the Australian coal mining industry. The fall has sparked concern as China has been one of the major buyers of the country’s coal throughout the global financial crisis.
But the financial advisors claim China’s demand for coal will continue to grow, despite the drop.

The group’s head of mining research, Gavin Wendt, says China still remains one of the strongest national economies.Also, Wendt says Australia has survived the biggest economic meltdown in living memory so there is tremendous cause for optimism.
Went claims the world is going to continue to grow, not only China. He says India also wants to source increasing amounts of coal as well. 

Fat Prophets believes the outlook for Australia’s coal industry is extremely positive but warns of volatility in the short-term.


----------



## Wysiwyg

pacestick said:


> FAT Prophets says the 25% drop in the Shanghai Index since May 2009 is no cause for concern for the Australian coal mining industry. The fall has sparked concern as China has been one of the major buyers of the country’s coal throughout the global financial crisis.
> *But the financial advisors claim China’s demand for coal will continue to grow, despite the drop.*




In support of the claims ...



> Bloomberg has reported that BHP Billiton (ASX: BHP) said China’s demand for coking coal is “sustainable” after *shipments of the steelmaking ingredient surged 30-fold.*
> 
> Imports of coking coal into the world’s largest steel- producing country will be about 30 million metric tons this year, up from 1 million tons last year and 3 million tons in 2007, said Vicky Binns, head of commodity analysis at BHP. The 30 million tons is about 7 percent of China’s total current consumption, she said. Melbourne-based BHP is the largest producer of coking coal through its BHP Mitsubishi Alliance with Japan’s Mitsubishi Corp.


----------



## sidious

noirua said:


> Thermal coal prices out of the Newcastle Port have continued their slide this week.  On 10th August the price stood at US$76.13 per tonne and at 4th September at US$66.30 per tonne.
> 
> A thermal coal exporter, together with strengthening of the Aussie, with sales at 5 million tonnes per annum would see a fall in profits of AU$75 million.
> Most miners will have have taken the money market option of fixing the rate against the dollar at the time of agreements of forward sales, to the sum involved. The better quality miners will have offset a lot of this in the run up to March 2010. Worth checking those Annual Results and Quarterly Reports.




By any chance this is CEY you're talking about?


----------



## noirua

Xstrata have said they are upbeat on thermal coal prospects:  http://www.miningmx.com/news/energy/xstrata-upbeat-on-coal-prospects.htm


----------



## noirua

Thermal coal futures continue to firm for Newcastle:  
2009 - $72.10 - $74.20  
2010 - $77.25 - $83.45
2011 - $87.20 - $95.85  
2012 - $97.35 - $98.95
2013 - $102.20 - $103.15
2014 - $104.50 per tonne

Deloitte have forecast thermal coal prices at $70 per tonne beyond 2013 - is this forecast over gloomy?


----------



## pacestick

Are the chinese likely to close their coal mines again following this  disaster they have in the past if they do so again the price of the black lumpy stuff should go up again


China coal mine blast death toll jumps to 87


HEGANG, China – Rescuers worked in frigid cold to reach 21 miners trapped underground Sunday as the death toll from a huge gas explosion in a northern Chinese mine jumped to 87 ”” the deadliest blast to hit the beleaguered industry in nearly two years.

The pre-dawn blast Saturday at the state-run Xinxing mine in Heilongjiang (pronounced HAY-long-jeeahng) province near the border with Russia was the latest to hit China's mining industry ”” the world's deadliest. Authorities say safety was improving, but hundreds still die in major accidents each year.

The death toll more than doubled overnight, reported the official Xinhua News Agency. A duty officer at Xinxing's work safety authority and an employee at the company that owns the mine confirmed 87 had died.

Ventilation and power were restored in the mine, said the employee, who refused to give his name because he was not authorized to speak to the media. The mine's director, deputy director and chief engineer were fired Saturday, he said.

A total of 528 people were working in the Xinxing (pronounced shin-shing) mine at the time of the 2:30 a.m. explosion Saturday, the State Administration of Work Safety said in a statement. Xinhua reported 420 escaped.

Television footage showed smoke billowing out of the mine after the blast that resulted from a gas build-up. The explosion caused a nearby building to collapse.

State-run CCTV displayed a diagram showing the miners trapped about a third of a mile (half a kilometer) underground. Footage showed one entrance was blocked, and rescuers in orange suits with breathing equipment attempted to enter through another.

Overnight temperatures dropped as low as 14 degrees Fahrenheit (minus 10 degrees Celsius), according to the Central Meteorological Station.

Wang Xingang, one of those rescued, recounted how the blast briefly knocked him out.

"When I regained consciousness, I groped my way out in the dark and called for help," Xinhua quoted the 27-year-old electrician as saying.

Xinxing is located near the border with Russia. Large state-owned coal mines, such as Xinxing, are generally considered safer than smaller, private ones that account for the bulk of production. Saturday's blast underscores the difficulties the government faces in trying to boost safety while maintaining output.

Coal is vital to the vast population and booming economy, as China uses it to generate about three-quarters of its electricity.

The government has cracked down on unregulated mining operations, which account for almost 80 percent of the country's 16,000 mines. It says the closure of about 1,000 dangerous small mines last year has helped it cut fatalities.

Yet major accidents persist. In the first nine months of this year, China's coal mines had 11 such incidents with 303 deaths. Gas explosions were the leading cause, the government said.

A blast at the Tunlan coal mine in northern China's Shanxi province in February killed 77 people. In December 2007, a gas explosion at another Shanxi coal mine killed 105 people.


----------



## noirua

China may well close very many more smaller mines once they are satisfied Shenua Energy have filled their 10 new storage areas, instigated by PRC, in Fuzhou, Provincial Fujian. This was for around 150 - 200 million tonnes.


----------



## Wysiwyg

Noted that UBS Nominees pty. ltd. became substantial share holders in Felix and Centennial. With a proposed emissions trading scheme, I would think the coal industry would be affected negatively.


----------



## Wysiwyg

> (Bloomberg)
> Updated: 2009-12-18 08:30
> 
> China, the world's largest steelmaker, faces a shortage of coking coal that may drive imports next year and spur a fight for resources with Japanese and South Korean mills, two Chinese industry groups said.
> 
> "Domestic demand for coking coal will rise moderately next year, while global demand may gain faster, intensifying competition," Wu Chenghou, senior adviser of the China Coal Transportation and Distribution Association, said in an interview.
> 
> *China's coking coal imports rose 12-fold this year*, *boosting sales of BHP Billiton Ltd. as the government closed smaller, unsafe mines. Prices may jump by between 23 percent and 38 percent in 2010, as global demand rebounds from the deepest recession since the 1930s, according to Macquarie Securities **Group, JPMorgan Chase & Co. and Morgan Stanley.*



http://www.chinamining.org/News/2009-12-18/1261096339d32445.html

Please note that this information is both factual and prospective. Prospective in regard to future demand and coking coal price increases.


----------



## TheAbyss

Interesting reader submission to the Rockhampton Bulletin regarding Coal fired power and the alternatives.

Worth thought for sure. NOt sure on the veracity of the facts quoted etc however coal is here to stray in my view so thought i would post for consideration and debate.

The Morning Bulletin,

I have sat by for a number of years frustrated at the rubbish being put forth about carbon dioxide emissions, thermal coal fired power stations and  renewable energy and the ridiculous Emissions Trading Scheme.  

Frustration at the lies told (particularly during the election) about global pollution. Using Power Station cooling towers for an example. The condensation coming from those cooling towers is as pure as that that comes out of any kettle.  

Frustration about the so called incorrectly named man made 'carbon emissions' which of course is Carbon Dioxide emissions and what it is supposedly doing to our planet.  

Frustration about the lies told about renewable energy and the deliberate distortion of renewable energy and its ability to replace fossil fuel energy generation. And frustration at the ridiculous carbon credit programme which is beyond comprehension.

And further frustration at some members of the public who have not got a clue about thermal Power Stations or Renewable Energy. Quoting ridiculous figures about something they clearly  have little or no knowledge of.

First coal fired power stations do NOT send 60 to 70% of the energy up the chimney. The boilers of modern power station are 96% efficient and the exhaust heat is captured by the economisers and re-heaters and heat the air and water before entering the  boilers.

The very slight amount exiting the stack is moist as in condensation and CO2. There is virtually no fly ash because this is removed by the precipitants or bagging plant that are 99.98% efficient. The 4% lost is heat  through boiler wall convection.

Coal fired Power Stations are highly efficient with very little heat loss and can generate massive amount of energy for our needs. They can generate power at efficiency of less than 10,000 b.t.u. per kilowatt and cost wise that is very low.

The percentage cost of mining and freight is very low. The total cost of fuel is 8% of total generation cost and does NOT constitute a major production cost. As for being laughed out of the country, China is building multitudes of coal fired power stations because they are the most efficient for bulk power generation.

We have, like, the USA, coal fired power stations because we HAVE the raw materials and are VERY fortunate to have them. Believe me no one is laughing at Australia - exactly the reverse, they are very envious of our raw materials and independence.

The major percentage of power in Europe and U.K. is nuclear because they don't have the coal supply for the future.

Yes it would be very nice to have clean, quiet, cheap energy in bulk supply. Everyone agrees that it would be ideal. You don't have to be a genius to work that out. But there is only one problem---It doesn't exist.  
Yes - there are wind and solar generators being built all over the world but they only add a small amount to the overall power demand.

The maximum size wind generator is 3 Megawatts, which can rarely be attained on a continuous basis because it requires substantial forces of wind. And for the same reason only generate when there is sufficient wind to drive them. This of course depends where they are located but usually they only run for 45% -65% of the time, mostly well below maximum capacity. They cannot be relied for a 'base load' because they are too variable. And they certainly could not be used for load control.

The peak load demand for electricity in Australia is approximately 50,000 Megawatts and only small part of this comes from the Snowy Hydro Electric System (The ultimate power Generation) because it is only available when water is there from snow melt or  rain. And yes they can pump it back but it cost to do that. (Long Story).

Tasmania is very fortunate in that they have mostly hydro electric generation because of their high amounts of snow and rainfall. They also have wind generators (located in the roaring forties) but that is only a small amount of total power generated.  Based on a average generating output of 1.5 megawatts (of unreliable power) you would require over 33,300 wind generators. 

As for solar power generation much research has been done over the decades and there are two types. Solar thermal generation and Solar Electric generation but in each case they cannot generate large amounts of electricity.  
Any clean, cheap energy is obviously welcomed but they would NEVER have the capability of replacing Thermal power generation. So get your heads out of the clouds, do some basic mathematics and look at the facts not going off  with the fairies (or some would say the extreme greenies.)

We are all greenies in one form or another and care very much about our planet. The difference is most of us are realistic. Not in some idyllic utopia where everything can be made perfect by standing around holding a banner and being a general pain in the backside.

Here are some facts that will show how ridiculous this financial madness the government is following. Do the simple maths and see for yourselves.  
According to the 'believers' the CO2 in air has risen from .034% to .038% in air over the last 50 years.

To put the percentage of Carbon Dioxide in air in a clearer perspective;
 If you had a room 12 ft x 12 ft x 7 ft or 3.7 mtrs x 3.7 mtrs x 2.1 mtrs, the area carbon dioxide would occupy in that room would be .25m x .25m x .17m or  the size of a  large packet of cereal. Australia emits 1 percent of the world's total carbon Dioxide  and the government wants to reduce this by twenty percent or reduce emissions by .2 percent of the world's total CO2 emissions.

What effect will this have on existing CO2 levels?  
By their own figures they state the CO2 in air has risen from .034% to .038% in 50 years.  

Assuming this is correct, the world CO2 has increased in 50 years  by .004 percent. Per year that is .004 divided by 50 = .00008 percent. (Getting confusing -but stay with me).

Of that because we only contribute 1% our emissions would cause CO2 to rise .00008 divided by 100 = .0000008 percent.

Of that 1%, we supposedly emit, the governments wants to reduce it by 20%  which is 1/5th of .0000008  = .00000016 percent effect per year they would have on the world CO2 emissions based on their own figures. 
That would equate to a area in the same room, as the size of a small pin head. 

For that they have gone crazy with the ridiculous trading schemes, Solar and roofing installations, Clean coal technology. Renewable energy, etc, etc.  
How ridiculous it that?

The cost to the general public and industry will be enormous. Cripple and even closing some smaller business.  

T.L. Cardwell

To the Editor  I thought I should clarify. I spent 25 years in the Electricity Commission of NSW working, commissioning and operating the various power units. My last was the 4 X 350 MW Munmorah Power Station near Newcastle.   I would be pleased to supply you any information you may require.


----------



## pacestick

Either they have changed the method of graphing or a demented chicken got hold of their software . The only thing i can interpret is that coal continues to go up. Whoops when i checked it agian it had improved but at the end the coal price had fallen slightly still strong gains over time tho

https://www.theice.com/marketdata/getGlobalCOALIndex.do?reportCategory=Indices&reportType=Newcastle


----------



## noirua

pacestick said:


> Either they have changed the method of graphing or a demented chicken got hold of their software . The only thing i can interpret is that coal continues to go up. Whoops when i checked it agian it had improved but at the end the coal price had fallen slightly still strong gains over time tho
> 
> https://www.theice.com/marketdata/getGlobalCOALIndex.do?reportCategory=Indices&reportType=Newcastle




Coal price is probably coming under the same pressure, due to a stronger US$ because of recent US encouraging new jobs data, as oil is.


----------



## michael_selway

noirua said:


> Coal price is probably coming under the same pressure, due to a stronger US$ because of recent US encouraging new jobs data, as oil is.




Yeah could buy once its fallen and dust settles, futures still look pretty good though

ICE Rotterdam ICE Richards Bay ICE globalCOAL NEWC ® 
*May'10 $91.35 $91.35 $103.40 
Jun'10 $92.00 $91.90 $103.25 
Q3'10 $92.75 $91.65 $102.50 
Q4'10 $96.50 $93.50 $102.65 
Q1'11 $98.95 $93.70 $102.50 
Q2'11 $101.30 $94.45 $102.60 
2011 $102.45 $95.46 $102.70 
2012 $109.65 $101.65 $106.14 
2013 $116.90 $107.10 $110.85 
2014 $119.25 $111.00 $112.50 *

Monthly Index  
NEWC Index RB Index DES ARA Index 
*Apr-2010 100.21 88.79 79.72 
Mar-2010 94.66 82.99 73.58 
Feb-2010 93.25 82.88 75.70 
Jan-2010 95.20 86.02 85.99 *

Weekly Index 
NEWC Index RB Index DES ARA Index 
*07-May-2010 106.20 94.67 90.29 
30-Apr-2010 108.87 96.13 88.52 
23-Apr-2010 100.18 91.63 78.65 
16-Apr-2010 98.28 85.25 77.24 *


----------



## noirua

Warren Buffett could be eyeing coal: http://www.businessinsider.com/warren-buffett-could-be-eyeing-coal-2010-12


----------



## Wysiwyg

With coal maybe nudging $500 / tonne then each coal wagon will be carrying about 40k worth of coal. 96 wagons for an average train = $3.84 million per train at spot coal price.


----------



## Smurf1976

Wysiwyg said:


> With coal maybe nudging $500 / tonne then each coal wagon will be carrying about 40k worth of coal. 96 wagons for an average train = $3.84 million per train at spot coal price.



Short the railways and buy shares in Armaguard instead? They'll need an armed vehicle to carry the coal at that rate... : 

Seriously, for thermal coal the price of fuel oil (or crude oil) sets a practical limit since there's considerable ability to substitute oil instead of coal for power generation (which, contrary to popular belief, doesn't normally use a lot of oil in most countries (though there are a few notable exceptions that use lots of oil)). 

Oil is generally the fallback fuel when others are unavailable, and there's also the point that using oil tends to be somewhat cheaper in terms of non-fuel costs than coal due to its physical properties. In other words, power is generated from coal only because (1) tariffs, industry protection, national security etc (2) it's cheaper than oil. If coal had not been cheaper than oil since the early 1970's then there would be few modern coal-fired power stations in operation today. We use coal because it's cheap.

So if thermal coal approaches parity with oil then we can expect to see the oil price rise as well as substitution occurs. Given that a supply side response in oil production is unlikely and that the situation in Queensland is such that global coal demand likely does exceed supply capacity at the moment, it would seemingly come down to price rises for coal and oil, whilst also encouraging maximum utilisation of other energy sources that are available at short notice (most notably gas).

Add to that the recent outage of the pipeline in Alaska which shut down virtually all Alaskan oil production for a few days. Then add in the cold weather in the Northern hemisphere and associated demand for heating fuels.


----------



## Wysiwyg

Interesting Smurf.  

1 metric tonne of coal  = 4.879 barrels of crude oil equivalent.

So @ $90 / barrel of oil, coal could be more expensive . I suppose oil would be atomised via injection into the boilers for a conversion.


----------



## Smurf1976

Wysiwyg said:


> So @ $90 / barrel of oil, coal could be more expensive . I suppose oil would be atomised via injection into the boilers for a conversion.



They are normally used as peaking or reserve plant only, but there are quite a lot of oil-fired power stations in the world, most of them built during the 60's and 70's when oil was cheap. Many of these plants are still in operating condition, or could be brought back from reserve if it were profitable to do so.

So it's largely a case of shifting production between power stations rather than simply switching fuels, although any modern coal-fired plant does have the ability to substitute at least some oil and/or gas since this is the fuel used for start-up (though they generally can not achieve full output using only the start-up fuel, but it's one means of cutting coal consumption if there's a reason to do so).

And then there's always gas turbines, many of which are liquid (diesel, kerosene) fuelled. Normally they're peaking and backup plant only. But if diesel becomes cheaper than coal then all that changes rather quickly since the reason they sit idle most of the time is more economic than technical (though actually getting enough liquid fuel to the plants could be an issue if they were run 24/7 since in many cases we're talking road transport. But they could certainly be run more than they are now if it made financial sense to do so).

In short, if oil were cheaper than coal then it's not possible to swap all electricity generation onto oil. But there's quite a few things that can be done to bring about a reduction in coal use and an increase in oil use. They can be substituted sufficiently that the coal price ought to not exceed the oil price, at least not for thermal coal (coking coal is another story).


----------



## Miner

Smurf1976 said:


> Short the railways and buy shares in Armaguard instead? They'll need an armed vehicle to carry the coal at that rate... :
> 
> Seriously, for thermal coal the price of fuel oil (or crude oil) sets a practical limit since there's considerable ability to substitute oil instead of coal for power generation (which, contrary to popular belief, doesn't normally use a lot of oil in most countries (though there are a few notable exceptions that use lots of oil)).
> 
> Oil is generally the fallback fuel when others are unavailable, and there's also the point that using oil tends to be somewhat cheaper in terms of non-fuel costs than coal due to its physical properties. In other words, power is generated from coal only because (1) tariffs, industry protection, national security etc (2) it's cheaper than oil. If coal had not been cheaper than oil since the early 1970's then there would be few modern coal-fired power stations in operation today. We use coal because it's cheap.
> 
> So if thermal coal approaches parity with oil then we can expect to see the oil price rise as well as substitution occurs. Given that a supply side response in oil production is unlikely and that the situation in Queensland is such that global coal demand likely does exceed supply capacity at the moment, it would seemingly come down to price rises for coal and oil, whilst also encouraging maximum utilisation of other energy sources that are available at short notice (most notably gas).
> 
> Add to that the recent outage of the pipeline in Alaska which shut down virtually all Alaskan oil production for a few days. Then add in the cold weather in the Northern hemisphere and associated demand for heating fuels.




Hi
Thanks for your modesty.
Your comments were never worth 2 cents. I would certainly rate it as few hundreds of dollars. Good points raised and I liked your other posting on coal as well.

If you know some one is selling cheap coking coal please let me know. 

With the rising price of coal, the problem or opportunity now for the iron and steel producer to do away with Blast Furnace route of iron making. This requires about 600 kgs of coking coal per ton of iron production.

My 12 years experience in blast furnace route of making steel is now becoming obsolete 

Cheers


----------



## michael_selway

noirua said:


> Thermal coal futures continue to firm for Newcastle:
> 2009 - $72.10 - $74.20
> 2010 - $77.25 - $83.45
> 2011 - $87.20 - $95.85
> 2012 - $97.35 - $98.95
> 2013 - $102.20 - $103.15
> 2014 - $104.50 per tonne
> 
> Deloitte have forecast thermal coal prices at $70 per tonne beyond 2013 - is this forecast over gloomy?




http://www.globalcoal.com/futures/market.cfm

How futures have changed!

ICE Coal Futures Daily Settlement Prices for Friday, 01 April 2011
  ICE Rotterdam ICE Richards Bay ICE globalCOAL NEWC ® 
Apr'11 $128.60 $122.65 $123.50 
May'11 $129.00 $123.00 $123.75 
Q2'11 $128.98 $123.05 $123.83 
Q3'11 $129.75 $124.65 $126.20 
Q4'11 $131.05 $126.05 $127.85 
Q1'12 $132.00 $127.00 $130.20 
*2012 $132.16 $127.30 $130.51 
2013 $132.00 $127.71 $130.10 
2014 $134.25 $129.25 $131.05 
2015 $135.95 $130.10 $131.10*

Btw Noirua, any coal stocks out there you like at current prices? thanks MS

---------------------------------------------

*Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES 

Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL*


----------



## noirua

michael_selway said:


> http://www.globalcoal.com/futures/market.cfm
> 
> Btw Noirua, any coal stocks out there you like at current prices? thanks MS
> 
> ---------------------------------------------
> Hi m-s, The coal boom continues onwards but who knows what happens in 2013 when loads of new mines come onstream. Also all this upgrading of Indonesian coal.
> 
> As to Deloitte, they should be kept well away from commenting on coal prices.
> 
> Most coal stocks are worth buying unless their mines fail to come onstream until 2012 and beyond, imho. All in the high risk sector and worth doing plenty of research on.
> Look, as I know you do, at the quality of coal, and PCI coal and semi-soft coke with a mix of quality thermal coal seems the type of company that's OK.
> Hard and semi-hard coke needs a bit of watching as steel prices are not that great, could be priced over the roof these days.
> 
> Quite a lot of views on iron ore as new mines come onstream around 2013/2014.
> 
> Good luck. (one handed typist at the moment as my right arm was poisoned by Viburnum Tinus Davidii pollen, recovering very slowly indeed.)


----------



## michael_selway

noirua said:


> michael_selway said:
> 
> 
> 
> http://www.globalcoal.com/futures/market.cfm
> 
> Btw Noirua, any coal stocks out there you like at current prices? thanks MS
> 
> ---------------------------------------------
> Hi m-s, The coal boom continues onwards but who knows what happens in 2013 when loads of new mines come onstream. Also all this upgrading of Indonesian coal.
> 
> As to Deloitte, they should be kept well away from commenting on coal prices.
> 
> Most coal stocks are worth buying unless their mines fail to come onstream until 2012 and beyond, imho. All in the high risk sector and worth doing plenty of research on.
> Look, as I know you do, at the quality of coal, and PCI coal and semi-soft coke with a mix of quality thermal coal seems the type of company that's OK.
> Hard and semi-hard coke needs a bit of watching as steel prices are not that great, could be priced over the roof these days.
> 
> Quite a lot of views on iron ore as new mines come onstream around 2013/2014.
> 
> Good luck. (one handed typist at the moment as my right arm was poisoned by Viburnum Tinus Davidii pollen, recovering very slowly indeed.)
> 
> 
> 
> 
> 
> Cool thanks and yeah Cool is good but just the price for most of them is quite high atm
> 
> GUF-Guildford Coal has been mentioned a few times but it too has made a good run already thanks
Click to expand...


----------



## springhill

An indication of Coal prices for the coming quarter, pulled from WES announcement.

*JULY 2012 TO SEPTEMBER 2012 QUARTER COAL PRICE NEGOTIATION*Price negotiations for the July 2012 to September 2012 quarter for metallurgical coal exports from Wesfarmers Resources’ Curragh mine in Queensland’s Bowen Basin have now been concluded with the majority of customers.
For the July 2012 to September 2012 quarter, the weighted average US$FOB for new contract prices of Curragh metallurgical coal (hard coking, semi-hard coking and PCI) will increase by approximately 4 per cent as compared to the April 2012 to June 2012 quarter prices. All of Curragh’s contracted tonnage for this quarter is under the quarterly pricing mechanism.
The Managing Director of Wesfarmers Resources, Mr Stewart Butel, said the company was satisfied with the result of its negotiations for Curragh’s hard coking coal, with price settlements for the July 2012 to September 2012 quarter at approximately US$220 per metric tonne FOB Queensland.


----------



## noirua

springhill said:


> An indication of Coal prices for the coming quarter, pulled from WES announcement.
> 
> *JULY 2012 TO SEPTEMBER 2012 QUARTER COAL PRICE NEGOTIATION*Price negotiations for the July 2012 to September 2012 quarter for metallurgical coal exports from Wesfarmers Resources’ Curragh mine in Queensland’s Bowen Basin have now been concluded with the majority of customers.
> For the July 2012 to September 2012 quarter, the weighted average US$FOB for new contract prices of Curragh metallurgical coal (hard coking, semi-hard coking and PCI) will increase by approximately 4 per cent as compared to the April 2012 to June 2012 quarter prices. All of Curragh’s contracted tonnage for this quarter is under the quarterly pricing mechanism.
> The Managing Director of Wesfarmers Resources, Mr Stewart Butel, said the company was satisfied with the result of its negotiations for Curragh’s hard coking coal, with price settlements for the July 2012 to September 2012 quarter at approximately US$220 per metric tonne FOB Queensland.




Interesting even though hard coke price is down around 25% from the $300 level.

One danger for thermal coal comes from China with reports of known thermal coal resources at 5.5 trillion tonnes. Xinjiang has 2.19 trillion tonnes alone, about 40% of total resource, and foreign companies are becoming involved in buying ELs and MLs from Chinese owners for cash or/and royalties.

Many foreign companies including China's Shenhua are increasing interest in Mongolia where there are many very thick near surface coking coal resources.


----------



## Smurf1976

noirua said:


> One danger for thermal coal comes from China with reports of known thermal coal resources at 5.5 trillion tonnes. Xinjiang has 2.19 trillion tonnes alone, about 40% of total resource, and foreign companies are becoming involved in buying ELs and MLs from Chinese owners for cash or/and royalties.



There seem to be two distinct lines of thought so far as Chinese coal reserves are concerned.

1. Reserves are relatively limited and, given that they already account for about 50% of global output, we'll soon see a peak in production followed by a plateau and ultimate decline. China will thus depend on imports for any further growth of coal use, and is likely to focus heavily on alternative forms of energy for this reason. Witness the growth of coal imports plus the big LNG, hydro and nuclear projects as evidence.

2. China has vast coal reserves, information about which is fairly limited. China's construction of so much coal-fired power generating capacity is thus soundly based with plenty of coal for this and more. The hydro projects are just a cheaper means of meeting peak loads and there are of course non-power related uses of the dams too. Nuclear energy has more to do with national pride and technological development than any shortage of coal. And the LNG is for direct use as reticulated gas, thus cleaning up air in the cities, rather than as a replacement for limited coal supplies to large power stations.

Which is true I really don't know, but I've heard credible arguments for both positions at various times over the past few years.


----------



## FlyingFox

China has just announced plans to reduce (and possibly reverse) coal usage. Can't be good for Oz.

http://www.smh.com.au/business/carb...-flags-peak-in-coal-usage-20130206-2dxrv.html


----------



## notting

> Foreign energy analysts are mostly sceptical that China can meet its “non-binding” energy goal, pointing out that it missed its 2010 target by a large margin.
> They are broadly unconvinced that the energy targets can be achieved without an intolerable drop in the GDP growth rate.
> Chinese officials and analysts acknowledge that state-owned enterprises, regional leaders and their political patrons have resisted or ignored previous edicts.
> Read more: http://www.smh.com.au/business/carb...-coal-usage-20130206-2dxrv.html#ixzz2K62SYdnK




Their still building coal fired power stations all over the joint.
The asphyxiating air is becoming an issue for the people.  
But the rulers think it's quite a good situation and solution to the aging population weight on the dictatorship, so not much motive to pull back yet.  Making electricity is profitable and cheaper than building gas chambers and is also more balanced than the one child policy given girls are regularly minced into the trash.


----------



## pacestick

http://www.proactiveinvestors.com.a...-on-low-grade-coal-becomes-clearer-43678.html

China import ban on low grade coal becomes clearer
Friday, May 24, 2013 by Proactive Investors	

China import ban on low grade coal becomes clearer	

China's proposed ban on the import of lower grade thermal coal is becoming clearer after Platts has published the draft regulation.

This month, China's National Energy Administration (NEA) said it was proposing imports of thermal coal should have a calorific value of at least 4,540 kcal/kg on a net-as-received basis, a maximum sulfur content of 1%, and a maximum limit for ash of 25% on an as-received basis.

It did not include any detail on total moisture.  NEA is a government body that promulgates energy policy in China.

The reasons given by the NEA for its ban on some coal imports was to better regulate the production and distribution of coal products in China.

Another reason given by the NEA for its regulation was that it wanted to improve the utilization of cleaner coal products in China, given the continued smoggy weather in northern China.

It is understood there was no time frame given for how long the edict would remin in place or when the ban would commence.

Domestically produced metallurgical coal would also not escape the net as it the regulation would mean this coal would have a maximum ash content of 12%, a maximum total moisture content of 12%, and a maximum sulfur content of 1.75%.

The ban if put in place would have significant ramifications for coal miners and explorers globally.


----------



## Smurf1976

pacestick said:


> This month, China's National Energy Administration (NEA) said it was proposing imports of thermal coal should have a calorific value of at least 4,540 kcal/kg on a net-as-received basis, a maximum sulfur content of 1%, and a maximum limit for ash of 25% on an as-received basis.



What this means in terms of the environment really depends on how the coal is being used. If you're burning the stuff at home then yes, higher grade coal will pollute less and the same applies to older industrial boilers etc. But if it's going into a reasonably modern power station then sulphur is the only real point of relevance. Energy content, ash and moisture won't make much difference to what comes out the stack since the ash is mostly captured anyway, and water vapour wouldn't normally be considered a problem.

In terms of market impacts, the practical effect is likely to be a "split" in the market. Coal that doesn't meet these standards will still end up finding some other buyer, but will do so at a discount. That being so, if the gap is large enough then it's not impossible that countries with coal meeting these requirements end up exporting it to China then using lower grade (cheaper) imports to supply their own consumption. 

It sounds a bit odd, but that is essentially what Australia already does with oil (and has done so for decades). Sell the good stuff at one price, import lower grade and cheaper product to use at home.


----------



## drillinto

January 29, 2013

China consumes nearly as much coal as the rest of the world combined

http://www.eia.gov/todayinenergy/detail.cfm?id=9751
***


----------



## Ann

I have neglected coal. I will need to start posting some charts. I found an interesting article today with some nice pictures.

*What Life After Coal Looks Like *
The Jiu Valley in Romania was once an economic powerhouse, producing millions of tons of coal. Now most of the mines in the region are closed.


A couple of charts. The first one is a short term 12 month chart which shows a fail of a bearish Descending Triangle, the second one is a long term view 10 year chart. It has broken above its falling overhead resistance line and it may be traveling in an upward channel or it may continue to fall for a while and create a reasonably bullish Megaphone pattern or it could keep falling to make a double bottom. I just want to get up to speed with the price of Coal as it is not a commodity I have looked at before. I think it needs to be watched. Just for fun!


----------



## Ann

*Trump's Latest Idea to Help Coal Is Mini Power Plants*
_
President Donald Trump’s latest idea to save coal-fired power plants: shrink them.

The U.S. Energy Department said Friday it’s making $100 million available to help develop what it labeled as coal plants of the future -- ones that are smaller than conventional, utility-scale plants, more nimble and more efficient. This builds on the agency’s recent efforts to get small coal plants off the ground. It’s calling the initiative “Coal FIRST” (for flexible, innovative, resilient, small and transformative).  More..._


----------



## Ann

This doesn't bode well for our coal miners........

*"That's Something China Can't Tolerate": Tensions Erupt As China Slams Australia's "Irresponsible Comments"*
_
It all started in late February when we reported that a political row had erupted between China and Australia, with Beijing cracking down on imports of coal from Australia, cutting off the country's miners from their biggest export market and threatening the island nation's economy at a time when it and its fellow "Five Eyes" members who have sided with the US by blocking or banning Huawei's 5G network technology.


In the weeks that followed, while Beijing disputed such a draconian export crackdown, China was overtly targeting Australian coal imports with increased restrictions – what Beijing claims were quality checks – that delayed their passage through northern ports. Given Australia has the highest level of income dependency on China of any developed nation as 30.6% of all Australian export income came from China last year, equivalent to US$87 billion (twice the trade volume with Japan, Australia’s next biggest trading partner), and Australia’s coal industry is deeply dependent on its exports to China, which account for 3.7% of Australia’s GDP, *this prompted much speculation that Beijing is punishing coal companies as retribution for political acts by Canberra, one of Washington’s closest allies.* "The last time Australia was so dependent on one country for its income was in the 1950s when it was a client state of Britain," Sydney Morning Herald’s international editor, Peter Hartcher Hartcher said in March, according to the SCMP. 
_
_More..._


----------



## Value Collector

Ann said:


> This doesn't bode well for our coal miners........
> 
> *"That's Something China Can't Tolerate": Tensions Erupt As China Slams Australia's "Irresponsible Comments"*
> _
> It all started in late February when we reported that a political row had erupted between China and Australia, with Beijing cracking down on imports of coal from Australia, cutting off the country's miners from their biggest export market and threatening the island nation's economy at a time when it and its fellow "Five Eyes" members who have sided with the US by blocking or banning Huawei's 5G network technology.
> 
> 
> In the weeks that followed, while Beijing disputed such a draconian export crackdown, China was overtly targeting Australian coal imports with increased restrictions – what Beijing claims were quality checks – that delayed their passage through northern ports. Given Australia has the highest level of income dependency on China of any developed nation as 30.6% of all Australian export income came from China last year, equivalent to US$87 billion (twice the trade volume with Japan, Australia’s next biggest trading partner), and Australia’s coal industry is deeply dependent on its exports to China, which account for 3.7% of Australia’s GDP, *this prompted much speculation that Beijing is punishing coal companies as retribution for political acts by Canberra, one of Washington’s closest allies.* "The last time Australia was so dependent on one country for its income was in the 1950s when it was a client state of Britain," Sydney Morning Herald’s international editor, Peter Hartcher Hartcher said in March, according to the SCMP.
> _
> _More..._




This video is funny, but also offers some interesting facts and perspective to the debate.


----------



## MARKETWINNER

Chinese import curbs, high renewable energy generation and collapsing gas prices in Europe are not supporting coal. In Asia, gas is competing closely with coal in power generation. However, low income emerging markets will create some demand for coal as their power sectors are expanding.


----------



## Smurf1976

Ann said:


> *Trump's Latest Idea to Help Coal Is Mini Power Plants*



The only power I can see being generated there is political not electrical.

There's nothing new about the idea of small coal-fired power stations, indeed that's exactly what we had before big ones were built.

Circa 1900 things in the order of 1 - 2 MW were being built.

1920 it was 10 - 15 MW machines going in.

1950's it was still 50 MW machines being commissioned which then went to 60 MW.

1960's saw a very quick rise to 120, 200, 275, 350 MW.

1970's it went to 500 then 660 MW.

In the late 1960's anything smaller than about 30 MW was scrapped as uneconomic due to too much labour versus output. Another round of scrapping in the 1980's killed off most plant under 120 MW. 

In Australia today, there's nothing under 200 MW still running so far as coal plant is concerned and of the 28 units in the 200 - 275 MW range ever built in Australia, only 12 are still in service today so they're on the way out too.

So I'm not seeing anything other than politics in the idea of building small coal-fired power stations. They're considerably more expensive per unit of output than large ones and the trend is very much that smaller plants are increasingly uneconomic and end up closed. 

If the aim was to make coal more economical then going larger, not smaller, would be the focus.


----------



## Ann

*China's Far From Done With Coal as Regulator Eases New Plant Ban*

_China allowed 11 provinces and regions to resume building coal power plants, in another sign that the world’s largest energy user is far from finished with the most-polluting fossil fuel.

The National Energy Administration forecast that only 10 provinces and regions would have an excess of coal-fired electricity generation capacity in 2022, down from last year’s outlook for a glut in 21 areas by 2021. That means 11 areas can start building plants again, as the overcapacity label had suspended construction of new projects until the issue was addressed. More...

_


----------



## Smurf1976

Smurf1976 said:


> If the aim was to make coal more economical then going larger, not smaller, would be the focus.



To add to that comment, coal was well and truly on the way out during the 1960's.

Cheap fuel oil flooded the market from about 1958 onward and within just a few years pretty much nobody was building anything new that used coal unless it was either technical necessity (eg steel) or on a very large scale (big power stations). A lot of existing facilities were converted from coal to oil, households abandoned it and in quite a few places around the world coal was close to extinct within a decade. Even the UK was building primarily oil and nuclear plant by 1970.

It was only the 1973 and 1979 oil crises which saved coal from extinction back then as "anything that worked" as an alternative to oil was embraced in a panic and when it came to running boilers coal was the obvious answer. Coal made a comeback in a big way.

A key point there being this isn't the first time the future of coal has been in doubt and if there's a straightforward alternative available then only the very largest single site uses of coal are viable. That comes down to the reality that as a bulky solid material which contains ash, it's simply far more capital and labour intensive to use when compared to other means of producing heat. Only way around that in any country with high labour costs is truly massive scale and automation.

Anyone who thinks small is going to save coal is dreaming really. Even in China they might be building more huge coal power stations but they're also actively ditching coal for residential heating.


----------



## Ann

*China's `Friendly' Neighbors Seize Coal Share From Australia*

China’s move to stifle coal imports from Australia is hurting its No. 2 supplier, with shipment figures showing the exporter conceding share in the world’s largest market.

Cargoes from Australia accounted for 18 percent of China’s overseas purchases in March, near the lowest since 2012, according to customs data and Bloomberg calculations. Meanwhile, Russia and Mongolia steadily built their share in the past few months as customs delay hobbled their rival. Top shipper Indonesia maintained its stake at about 50 percent. More...


----------



## Zaxon

According to an in-depth article I read last night, it seems the wholesale price of generating electricity from coal is still the cheapest.

Coal: $40/MWh



Renewables: $55/MWh



https://www.abc.net.au/news/2019-04...ment-maybe-heading-from-boom-to-bust/11041964


----------



## Ann

*UK has first coal-free week for a century*

Britain has had its first week without using electricity from burning coal since the 1880s, according to the National Grid Electricity System Operator (ESO).

Fintan Slye, director of ESO, said this would become the "new normal".

The world's first centralised public coal-fired generator opened in 1882 at Holborn Viaduct in London.

The government plans to phase out the UK's last coal-fired plants by 2025 to reduce carbon emissions.

Mr Slye said: "As more and more renewables come on to our energy system, coal-free runs like this are going to be a regular occurrence.

"We believe that by 2025, we will be able to fully operate Britain's electricity system with zero carbon." More...


----------



## Ann

Instead of closing down an old nuclear plant, they are going to extend its life by 10 years.....
I reckon this whole CC push is being funded by Big Nuclear Energy.

*Two Coal Plants Closing a Decade Early in the U.S. Midwest*

_Xcel Energy Inc. plans to shutter its last two coal-fired power plants in the Upper Midwest a decade ahead of schedule as part of a pledge to phase out carbon-dioxide emissions.

The Minneapolis-based company expects to close the Allen S. King power plant in 2028 and its Sherco 3 facility in 2030, according to a statement Monday. Both plants are in Minnesota.

cut carbon-emissions 80% by 2030 and 100% by 2050. In December, the company became the first big U.S. utility to commit to eliminating all its carbon emissions, mainly by using renewable energy. Xcel is accelerating its plan to close the two coal plants by seeking permission to operate its Monticello nuclear plant through at least 2040, instead of retiring it by 2030. More..._


----------



## greggles

First China, now India is running short of coal: https://edition.cnn.com/2021/10/06/energy/india-energy-crisis-coal-hnk-intl/index.html

That can only mean higher coal prices in the short term as energy producers scramble to secure more supply.

I would like to believe that there will be a shift to renewables at some point in the medium term, but suspect that nuclear will be the direction many countries will move to out of convenience.


----------



## divs4ever

is the problem  digging it  ( including getting approvals to expand existing projects ) or delivering it  , or maybe the right type of coal available  ( maybe a bit of all of them )

 take care 

 there are some with an agenda out there 

  i hold WHC ( 'free-carried ' ) NHC , S32 and BHP

 i am not anti-coal , but some out there are


----------



## Investoradam

drillinto said:


> January 29, 2013
> 
> China consumes nearly as much coal as the rest of the world combined
> 
> http://www.eia.gov/todayinenergy/detail.cfm?id=9751
> ***



China does some 70% of the worlds steel production. Coal is a major requirement with the iron ore to make steel


----------



## Smurf1976

divs4ever said:


> is the problem digging it ( including getting approvals to expand existing projects ) or delivering it , or maybe the right type of coal available ( maybe a bit of all of them )



It's a question of capacity.

Take any given coal resource. That is, coal in the ground.

A portion of that is technically impractical to mine so write that off as worthless.

Some of what can be mined might be of poor quality. Someone might buy it locally but it would never be up to spec for sale etc. So forget that unless some local user wants it (in which case they'd either mine it themselves or whoever does mine it would be a contractor to that user and not really a coal supplier as such).

Of what's left, some or in the best cases all of it can be economically mined. That's the reserve.

Size of the coal deposit imposes a practical upper limit on the rate of extraction. It's just not possible to rip the whole lot out instantly etc.

Then there may be limitations on the capacity of local infrastructure. Roads, rail, power, water and so on. That may limit production to some rate that's lower than the limit imposed by the deposit itself unless you want to spend $$$ upgrading that infrastructure.

Then the economics of mining also impose a limit. Eg it may not be economic to double your capital investment simply in order to extract the same amount of coal in half the time, there's a balance point given the total quantity of the reserve is fixed.

Put that all together and the end result is any given mine has a maximum rate of production that can't easily be increased. Spend the money to overcome whatever the bottleneck is and then you just run into the next lowest bottleneck. Etc.

That being so, for a country the size of China or India mining enough coal means having enough coal mines in operation. From there it's the same as anything - sufficient investment to meet demand for the product.

In terms of reserves and production limits, India could certainly mine more in terms of reserves, the limits are other things like how many mines are developed, infrastructure and so on but for China that's far more questionable. Unless both Western understanding and Chinese government official data are seriously understating reserves then realistically they're at or close to the limits. The resource base just doesn't support continuing recent rates of extraction too much longer before decline sets in.


----------



## qldfrog

Investoradam said:


> China does some 70% of the worlds steel production. Coal is a major requirement with the iron ore to make steel



Most of the coal is thermal coal so power stations and direct use to warm houses and flats


----------



## Smurf1976

Smurf1976 said:


> The resource base just doesn't support continuing recent rates of extraction too much longer before decline sets in.



Expanding on that, it's probably the single greatest aspect to the whole "China" story.

Claimed Chinese coal reserves, before mining, about 223 billion tonnes.

Mined thus far = 90 billion tonnes.

That leaves 133 billion tonnes being mined at the rate of ~3.5 billion tonnes per annum.

As the remaining reserve base gradually shrinks, it'll become harder and harder to keep enough mines in operation to sustain that production rate. At some point it starts to decline.

They could find more coal certainly but they'd need some pretty epic scale discoveries to reverse the overall situation that the production rate isn't sustainable. Bearing in mind that due to relatively low wages etc China already counts as "reserves" coal that would be considered uneconomic to mine if it were in Australia, Europe, Japan, US etc.

The history of coal mining in the UK is a good guide for what to expect. Production peaked way back in 1913 but as the reserve base fell, so too production slowly but relentlessly dropped off. 1980's politics might be heavily associated with it in the minds of many but in practice only slightly accelerated the end - production was already down 50% and falling by that time. 

The UK being another place that, historically, had a coal industry that was disproportionately large relative to the reserves on which it was based. Inevitably it couldn't be sustained.


----------



## qldfrog

Obviously sooner or later,if we extract and burn it, coal will be gone and yes,as uk,at one stage...no more..but i was a bit surprised by mr @Smurf1976 numbers.
From what i could find:
In 2016 150 billions tons proven reserves 
Link
in 2021(5 y) We find as explained above a huge variation but the pessimistic view is China may just have 30y reserve
Link
So no, China is not in coal resource shortage,still plenty of coal and in 30y..i will probably be gone...
BUT
As explained in last link, the virgin plentiful fields are in inner Mongolia and inhospitable areas with freezing snow impeded conditions.
And even pre covid,china was balancing its domestic production with a very small percentage of imports.
With 80pc of Chinese energy coal based, that tiny percentage was enough to create Australian and Indonesian coal boom
Add cold war and post covid boom:
->import vetoes and exploding growth demand this year depleted stocks and with winter coming and stranding resupply Chima faces coal shortage this winter.
So my view: it is a temporary situation..1y or so.. coupled with oil gas price boom caused by western green brainwashing which is preventing China to top-up missing domestic coal with cheap o/s oil gas.
Coal has at least 6m to a year of high price ahead.
But i bet you in a year china will have sorted that part out.
Will be a different story for oil and gas which will remain high so india and developing countries will ensure that coal demand and price remain elevated.
5y minimum of high energy price for the dirty carbon ahead


----------



## noirua

Australia still has its answer to Smokey thermal coals in its pocket but does nothing, or very little, to enhance. That is also the case in Indonesia and with China that buys coal from Indonesia and probably again from Australia once China has got off its high horse.

BCC technology, and other technologies,  that has been available from White Energy Limited WEC has stalled at every crossroad as roughly 2 tonnes of low grade thermal becomes one tonne of pellets.  Very less Smokey and more energy efficient. PT Bayan TBK of Indonesia broke a contract with WEC in 2011 for them to supply coal to the Tabang plant. Had they not done so very many more plants would be in action right now.  China are really responsible as they withdrew an agreement not to buy low grade Smokey coal from Indonesia and giant companies, in the sector, like Bayan increased the supply of low grade thermal coal and steaming coal to China.
2014 - https://www.worldcoal.com/handling/..._to_upgrade_south_african_coal_fines_coal767/

The BCC technology has been available in South Africa where they have well over 3 billion tonnes of coal fines piled up all over the place and there are now about 33 billion tonnes worldwide.  Due to upfront cost South Africa is responsible for not advancing the technology since 2009.
2014 - http://www.coaltechenergy.com/market-overview/


----------



## Smurf1976

qldfrog said:


> Obviously sooner or later,if we extract and burn it, coal will be gone and yes,as uk,at one stage...no more..but i was a bit surprised by mr @Smurf1976 numbers.
> From what i could find:
> In 2016 150 billions tons proven reserves
> Link
> in 2021(5 y) We find as explained above a huge variation but the pessimistic view is China may just have 30y reserve
> Link
> So no, China is not in coal resource shortage,still plenty of coal and in 30y..i will probably be gone...



The issue is extraction rate is itself a function of reserves.

A 30 year coal reserve doesn't mean you can just keep producing at a constant rate for 30 years and then stop. You can't in practice, at a large scale national level, end up with a 1:1 reserves to production ratio 12 months before it all comes to a halt.

As China's coal reserve base diminishes, a point will inevitably come where the reserves to production ratio flatlines. That is, rather than the ratio declining actual production starts to decline instead and the reserves to production ratio then remains roughly constant with both reserves and production in decline.

That's not some theory of mine, it's just what happens with basically any situation where you've got lots of mines in a given area extracting whatever resource. In the context of an entire country or large region, reserves to production ratio only comes down to a certain point then production itself starts to fall as individual mines close, fewer new ones are opened and so on.

China will never run out of coal but assuming they follow the same pattern seen everywhere else with lots of mines extracting the same thing, at some point their reserves to production ratio will flatline and then production starts to fall. At what level is the unknown but if they've really only got a ~40 year reserve at present then, in the absence of massive new discoveries, it's going to be something that happens this decade or next. 

Of course if they've got far more coal than most assume to be the case then that changes everything but the reality of coal production having essentially plateaued for the past decade, despite rising consumption, does raise questions there about the adequacy of reserves.

If they've got coal and are having no major barriers to mining it then that raises the question of why they'd rather import?


----------



## Smurf1976

Coal production by selected countries and world total.

Source of charts = IEA.









Red not identified on chart is Indonesia and light purple is Russia. Source for all = IEA


----------



## Smurf1976

Adding to previous post, my underlying point is simply a thought that China will likely continue to be a net importer of coal.

Regardless of the reason, production has been stalled for a decade now.

Add in the reserves, which I'll acknowledge are somewhat uncertain, and it's at least possible that the reserve base is a barrier to raising production to match consumption even if other hurdles could be overcome. That is uncertain but possible.

So I'm thinking that China won't be ending its imports of coal for quite some time.


----------



## qldfrog

Smurf1976 said:


> So I'm thinking that China won't be ending its imports of coal for quite some time.



Agree but does not mean they have to: they import our met coal because of its quality, and as opposed to Australia, they also have gov requirements pushing them to preserve some of their domestic capabilities.
And they do not export coal .ok maybe some strategic deal with North Korea and Iran..but not a commercial view.
The only interesting figure in my view is: prorata import vs domestic vs overall production for China
Unless something drastic has happened in the last 5 y or so,you will discover that imports are very small.single digit in percentage if i remember well.
Another point to be aware is coal mining is not iron ore or other metal mining: you have clear stata seams to be processed one after the other..very rough description...
But that mean that whereas a gold mine or nickel mine will go roughly from max quality to rubbish ore and so have a peak then down production profile.
But a coal mine will go seam by seam.kind of and a mine could for example sea its peak production arrive after a period of so so output .
Hope i am making myself clear..
The importance being is an individual coal mine will not have a gauss like production profile along time.
More binary.
Hope it helps but there's plenty of coal left in Mongolia..aka China, or Russia for China.
Another 20y no problemo...


----------



## Ann

Trading Economics makes the comment regarding coal....
"Coal futures rose slightly to $240 per metric ton on Friday but remained below a record of $269.5 hit on October 5th amid easing concerns about energy supply in China and Europe. Beijing ordered coal miners to boost production in an effort to curb an ongoing energy crisis, while Russian President Vladimir Putin said Gazprom will send more gas to European countries via Ukraine to ease the ongoing supply squeeze. Still, coal is up almost 200% so far this year as India is also faced with a major energy crunch, following China and Europe. The Indian government said the coal supply squeeze could last six months, as power plants reported to have enough reserves of the mineral for an average of 4 days of production."

Here is the current long term futures chart for coal from around 2010. Will it continue skyward? Nothing for me to draw on this chart, so let's put up a chart for NHC as well, this shows a falling overhead trendline that has yet to be tested. It certainly appears to have plenty of room to grow and offers a really good solid test line for future growth confirmation. Just for fun, I have drawn a measured move calculation on the 19-year chart as to where the price may move up to around $8.50 ish over time if it can break through the falling overhead trendline. Let's see!


----------



## Dona Ferentes

Chinese officials have ordered more than 70 mines in Inner Mongolia to ramp up coal production by nearly 100 million tonnes as the country battles its worst power crunch and coal shortage in years....









						China calls for huge boost in coal output to fight power crunch
					

Seventy-two mines in Inner Mongolia are given approval to boost production as China grapples with a major shortage.




					www.abc.net.au
				




..._._ and I forsee the emergence of a _Stakhanovite Movement (with Chinese characteristics) _in the not too distant future.


----------



## sptrawler

Why wouldn't China use everyone else's coal before their own? Seems perfectly sensible to me when you have 20% of the Worlds population, use other people's energy and save your own.
Also IMO, it is why there is a push now for a carbon tax, Western manufacturers are never going to be able to compete against cheap labour and cheap energy, the only way will be by introducing tariffs which the carbon tax by de facto becomes.
Once everyone gets on the same page and a universal carbon tax is embraced by the U.S, U.K and the E.U, China's cheap energy becomes China's expensive products.
That is if the carbon tax is implemented correctly.


----------



## Smurf1976

qldfrog said:


> But that mean that whereas a gold mine or nickel mine will go roughly from max quality to rubbish ore and so have a peak then down production profile.
> But a coal mine will go seam by seam.kind of and a mine could for example sea its peak production arrive after a period of so so output .
> Hope i am making myself clear..
> The importance being is an individual coal mine will not have a gauss like production profile along time.
> More binary.



For an individual mine totally agreed.  

For the world as a whole though we are indeed seeing a decline in coal quality:



			https://usea.org/sites/default/files/012011_Global%20perspective%20on%20the%20use%20of%20low%20quality%20coals_ccc180.pdf
		




> For decades, many coal-producing countries have witnessed a steady decline in the quality of the coal produced. Often, this reflects the increasing exhaustion of reserves of higher grade coals and a growing reliance on reserves of lower quality. This trend is particularly apparent in many of the long-industrialised nations, where significant coal production may have been taking place for several centuries






> Many non-European countries are also experiencing an overall decline in quality. In Asia, India has seen a steady decline in domestic coal quality. This has been among the key factors responsible for reducing overall efficiency and creating difficulties in many coal-fired power plants. These were designed for coals of a particular quality, and the use of higher ash levels and less consistent properties has resulted in a range of operational problems




Now I'm not suggesting that the world's running out of coal tomorrow but as with anything, the best resources are used first. Best being a combination of quality plus ease (cost) of extraction and as time passes we move onto lower quality or more costly resources.

What I do know with reasonable certainty though is that price is a problem. USD 240 per tonne is no doubt highly profitable in the short term for miners but in the long term that's going to dent consumption. It's hugely expensive by historic standards.


----------



## qldfrog

Smurf1976 said:


> For an individual mine totally agreed.
> 
> For the world as a whole though we are indeed seeing a decline in coal quality:
> 
> 
> 
> https://usea.org/sites/default/files/012011_Global%20perspective%20on%20the%20use%20of%20low%20quality%20coals_ccc180.pdf
> 
> 
> 
> 
> 
> 
> 
> Now I'm not suggesting that the world's running out of coal tomorrow but as with anything, the best resources are used first. Best being a combination of quality plus ease (cost) of extraction and as time passes we move onto lower quality or more costly resources.
> 
> What I do know with reasonable certainty though is that price is a problem. USD 240 per tonne is no doubt highly profitable in the short term for miners but in the long term that's going to dent consumption. It's hugely expensive by historic standards.



Or is it just the sign that one USD is not actually worth that much anymore?
Do we have a coal cheeseburger index?😊
But yes current prices will have to go down.and they will.just temporary blip
Oil is getting harder to get and rarer, coal just a bit harder but still not rare  in my opinion, it is far too early to see the demise of coal as a result of a resource constraint.i am talking next 2 decades at least.
Costs, artificial taxes and legislation,etc can affect use but in a (non existing) free market economy, there are no issue yet.
I would not change my super investment to bet for coal exhaustion .


----------



## Smurf1976

qldfrog said:


> Or is it just the sign that one USD is not actually worth that much anymore?
> Do we have a coal cheeseburger index?😊



We're having similar thoughts there....   

The biggest problem with coal is getting accurate information about it. Search online and you'll be presented with a barrage of politics, religion and fake news but very few facts from credible sources or even reasonably educated guesses.

That being so, well I'll certainly acknowledge that I'm not confident of the facts about what's in the ground and so on.

What I do know though is that price is a problem, big time. 

240 USD is beyond silly and outright ruinous to those using the coal. A lot of operations are better off ceasing production completely at that price, hence the shortages of power, cement, fertilizer and so on.


----------



## Country Lad

Smurf1976 said:


> 240 USD is beyond silly and outright ruinous to those using the coal.




It could get even sillier based on a New York Times story.  How is that decision not take our coal going?

*A rush for coal in China as power shortages spread*
_
China’s electricity shortage is rippling across factories and industries. Authorities announced on Wednesday a rush to mine and burn more coal in response, despite their previous pledges to curb emissions.

Mines that were closed without authorization have been ordered to reopen, along with mines and coal-fired power plants that were shut for repairs. Local governments have been warned to be cautious about limits on energy use.

The shortage laid bare a strategic weakness: China is a voracious energy hog and the world’s largest emitter of greenhouse gases. It also called into question whether Beijing can deliver strong economic growth.

*Context:* China depends on inefficient factories in energy-hungry industries like steel, cement and chemicals, but it practically stopped new coal investments in 2016 amid sustainability concerns. With rising demand as the pandemic eases, prices have jumped. Power plants were losing money, so they ran at lower capacity.

*What’s next:* The winter heating season officially begins on Friday in the country’s northeast. China’s biggest provinces have only nine to 14 days worth of coal in storage, according a coal data firm._


----------



## finicky

Country Lad said:


> How is that decision not take our coal going?



Beautiful to watch 😢


----------



## Ann

"China releases Australian coal trapped in storage to help fuel crisis
By Dan Murtaugh
October 7, 2021

China is releasing Australian coal from bonded storage as it seeks more fuel to relieve its stressed power system, Reuters reported.

It is about a year since Chinese leaders unofficially banned Australian coal amid escalating tensions between the countries. Some cargoes had been unloaded from ships and placed in bonded storage, with authorities not letting the fuel pass through customs to be used in the country.

Now that coal is being released, Reuters reported, citing unidentified sources. About 1 million tonnes remains in bonded storage, with some previously having been diverted to India, according to the report..............."

More here....https://www.smh.com.au/business/the-economy/china-releases-australian-coal-trapped-in-storage-to-help-fuel-crisis-20211006-p58xw8.html


----------



## qldfrog

Ann said:


> "China releases Australian coal trapped in storage to help fuel crisis
> By Dan Murtaugh
> October 7, 2021
> 
> China is releasing Australian coal from bonded storage as it seeks more fuel to relieve its stressed power system, Reuters reported.
> 
> It is about a year since Chinese leaders unofficially banned Australian coal amid escalating tensions between the countries. Some cargoes had been unloaded from ships and placed in bonded storage, with authorities not letting the fuel pass through customs to be used in the country.
> 
> Now that coal is being released, Reuters reported, citing unidentified sources. About 1 million tonnes remains in bonded storage, with some previously having been diverted to India, according to the report..............."
> 
> More here....https://www.smh.com.au/business/the-economy/china-releases-australian-coal-trapped-in-storage-to-help-fuel-crisis-20211006-p58xw8.html



Losing face is big in China, just wondering about the next  response


----------



## noirua

__





						PT Bayan Resources Tbk
					

PT Bayan Resources Tbk




					www.bayan.com.sg
				



Moody's upgrade: https://www.bayan.com.sg/cfind/source/files/press-release/rating action - moodys-upgrades-bayan-resources-to-ba2-outlook-stable - 29sep21.pdf


----------



## noirua

It is very difficult to solve this coal situation as companies will move to oil, if they can, if coal prices move higher. Lovely for Bayan as much of its coal is low grade thermal particularly from its Tabang mine. Australia has its thumb in the pie with Kangaroo Resources Limited now 100% owned by Bayan but the shares are held frozen in Australia by The High Court in Canberra.








						Bayan Resources completes A$515.2M acquisition of Kangaroo Resources
					

The company offered 15 Australian cents per share in mid-August, valuing Kangaroo at A$515.2 million.




					www.spglobal.com
				











						WEC: WA Court expands terms of freezing order against Bayan | MarketScreener
					

ASX Release                       ASX Release                       The Manager                       Company Announcements Office Australian Stock Exchange                       WA... | August 31,  2022



					www.marketscreener.com
				




China's plans are to extend the use of coal fired power stations despite saying the opposite.
China Is Planning to Build 43 New Coal-Fired Power Plants. Can It Still Keep Its Promises to Cut Emissions?​20 August 2021









						China Is Planning 43 New Coal-Fired Power Plants. Can It Still Keep Its Promises to Cut Emissions?
					

China built three times more new coal power capacity as all other countries in the world combined in 2020.




					time.com
				




China had 1,082 power stations at the end of 2020 ( use VPN or you may be blocked for multiple visits ):








						Number of coal power plants by country 2021 | Statista
					

Mainland China has the greatest number of coal-fired power stations of any nation in the world.




					www.statista.com
				



So basically China is having a laugh when it says we are planning to cut emissions. What they are really saying is that in the more developed parts of China new technology will bring about less emissions. But in the North of China they will carry on building coal fired power stations. Yes, less power stations built each year because they will be getting closer to the final number required.
Coal emissions will effect those in the North of China but further south where all the money clout is emissions will reduce. So heigh-ho, we have reduced emissions and slowed down the number of coal fired power stations being built.


----------



## Ann

qldfrog said:


> Losing face is big in China, just wondering about the next  response




Yes, it is most unfortunate. However their pain was not of our doing, let's hope they can move on from this in a positive manner.


----------



## greggles

US power companies ramping up their coal consumption due to surging natural gas prices.









						Coal-fired power is on the rise in America for the first time since 2014
					

In a blow to the climate movement, US power companies are ramping up their coal consumption due to surging natural gas prices.




					edition.cnn.com
				




It looks like it's going to be difficult to keep a lid on demand in the short term. Coal prices are likely to remain high during the northern hemisphere winter at the very least.


----------



## sptrawler

greggles said:


> US power companies ramping up their coal consumption due to surging natural gas prices.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Coal-fired power is on the rise in America for the first time since 2014
> 
> 
> In a blow to the climate movement, US power companies are ramping up their coal consumption due to surging natural gas prices.
> 
> 
> 
> 
> edition.cnn.com
> 
> 
> 
> 
> 
> It looks like it's going to be difficult to keep a lid on demand in the short term. Coal prices are likely to remain high during the northern hemisphere winter at the very least.



Plus it shows how fragile their tenure is on reducing their emissions, when the bottom line gets hit, good intentions go out the window. There will have to be a lot of structural changes enacted to remove coal from the mix.


----------



## Smurf1976

Something to consider about the US increase in consumption is that it will plausibly be matched by an increase in US coal mining.

The US does export coal but to substantial extent domestic production and consumption are tied, as consumption fell mines were scaled back rather than exporting the coal, so the reverse _may_ also hold true.

Also tied in with that is gas and oil. It's gas versus coal for power generation and noting that much of the US' gas production comes about as a by-product of oil production. Either out of the same well or because someone drilling for oil failed to find any but they did find gas instead. Both extremely common situations in the US with the practical effect of linking US gas production not just to US gas prices but also to international oil prices. It's a complex web basically.


----------



## Ann

.....and a bit more comment about coal with some interesting charts. There is no US ETF fund for coal any longer so Peabody Energy chart is probably going to be the best indicator to watch for coal other than the commodity price itself. I think I will toss up a chart for US PeabodyEnergy myself.

''US Coal Stockpiles Slump To Two Decade Low As Power Plant Demand Surges 
Wednesday, Oct 27, 2021 - 06:30 PM

One of the biggest ironies this year is the transition from fossil fuel generation to green energy has created a global energy crisis that is forcing the U.S., among many other countries, to restart coal-fired power plants ahead of the Northern Hemisphere winter. Coal is roaring back this fall but supplies are not catching up with demand. 

According to Bloomberg, US coal supplies dropped to 84.3 million tons in August, the lowest level since 1997." ....

More here....

https://www.zerohedge.com/commoditi...the+survival+rate+for+everyone+drops+to+zero)


----------



## Ann

Found this article and chart interesting from Zero Hedge "Coal Demand Booms Under Biden As Prices Hit 2009 Levels" (ignoring any political bias). https://www.zerohedge.com/commodities/coal-demands-boom-under-biden-prices-hit-2009-levels




and here is a chart from an historical view just for interest. The spike in the 2008 ish price is said to be related to the run-up from the GFC.


----------



## Smurf1976

Ann said:


> Found this article and chart interesting from Zero Hedge "Coal Demand Booms Under Biden As Prices Hit 2009 Levels" (ignoring any political bias).



Keeping out of politics but on the physical side of coal consumption there's a link between it and the oil industry.

Oil price has a very major influence on drilling for and thus production of oil.

With oil, especially in the US, usually comes associated gas. That is natural gas is a by-product of oil production whether wanted or not.

Consequence of the above is that the boom in US oil production seen in recent years came with a boom in gas production and that pushed natural gas prices to very low levels.

Cheap gas then prompted a switch to gas in power generation and industry. That can be either by running existing gas-fired power stations as priority (so gas becomes the normally run plant and coal becomes the backup rather than the reverse - technically a bit of a hassle but it can be done) or it can be done by fuel conversion of existing plant (converting a coal boiler to run on gas is very doable).

Reverse all that if oil drilling slows as it has greatly done so. Gas production starts coming down, prices rise, industry needing steam (lots of factories need steam or hot water in large volume) and power generation starts going back to coal since it's cheaper.

Adding to that, the US gas price has a _limited_ physical link to global markets via LNG. Capacity there is very limited but it's not zero so some linkage does exist and suffice to say international LNG prices have reached extremely high levels in recent times, prompting LNG export from the US to run flat out and that also adds upwards pressure on the gas price which then flows through to coal consumption.

Same dynamic is playing out in Australia by the way. I won't name them due to confidentiality but there are certainly some manufacturing operations that have quietly switched to coal in recent times. As gas prices have risen it was either coal or close, gas is simply too costly to be viable so coal it is.


----------



## Ann

Smurf1976 said:


> Same dynamic is playing out in Australia by the way. I won't name them due to confidentiality but there are certainly some manufacturing operations that have quietly switched to coal in recent times. As gas prices have risen it was either coal or close, gas is simply too costly to be viable so coal it is.




Very interesting Smurf, looking at the SMR long term monthly chart makes me think it is going to be the next black gold rush. (up in stocks)


----------



## Ann

I found this very interesting, a way for the fundies to get on board with coal generation without upsetting the climate change agenda mob, in fact, they may even get applauded . Gotta love spin doctors. 
This article from SMH was published back in August but I see the AFR only pick it up as an article this weekend.

"BlackRock joins Citi and HSBC in plan to close coal plants early
By Krystal Chia
August 4, 2021  

BlackRock and other major financial institutions are working on plans to accelerate the closure of coal-fired power plants in Asia in a bid to phase out the use of the worst man-made contributors to climate change.

The world’s biggest asset manager is partnering with Citigroup, HSBC and the Asian Development Bank to buy the plants and operate them for as long as 15 years before closing the assets ahead of current schedules, according to people familiar with the matter, who asked not to be named discussing a private matter."

More here...https://www.smh.com.au/business/companies/blackrock-joins-citi-and-hsbc-in-plan-to-close-coal-plants-early-20210803-p58flh.html


----------



## qldfrog

Ann said:


> I found this very interesting, a way for the fundies to get on board with coal generation without upsetting the climate change agenda mob, in fact, they may even get applauded . Gotta love spin doctors.
> This article from SMH was published back in August but I see the AFR only pick it up as an article this weekend.
> 
> "BlackRock joins Citi and HSBC in plan to close coal plants early
> By Krystal Chia
> August 4, 2021
> 
> BlackRock and other major financial institutions are working on plans to accelerate the closure of coal-fired power plants in Asia in a bid to phase out the use of the worst man-made contributors to climate change.
> 
> The world’s biggest asset manager is partnering with Citigroup, HSBC and the Asian Development Bank to buy the plants and operate them for as long as 15 years before closing the assets ahead of current schedules, according to people familiar with the matter, who asked not to be named discussing a private matter."
> 
> More here...https://www.smh.com.au/business/companies/blackrock-joins-citi-and-hsbc-in-plan-to-close-coal-plants-early-20210803-p58flh.html



That is incredibly smart from them


----------



## Ann

Art of War 101

“The whole secret lies in confusing the enemy so that he cannot fathom our real intent.” ― Sun Tzu

“Engage people with what they expect; it is what they are able to discern and confirms their projections. It settles them into predictable patterns of response, occupying their minds while you wait for the extraordinary moment — that which they cannot anticipate.” – Sun Tzu


----------



## qldfrog

Ann said:


> Art of War 101
> 
> “The whole secret lies in confusing the enemy so that he cannot fathom our real intent.” ― Sun Tzu
> 
> “Engage people with what they expect; it is what they are able to discern and confirms their projections. It settles them into predictable patterns of response, occupying their minds while you wait for the extraordinary moment — that which they cannot anticipate.” – Sun Tzu



So apt..and look at China..they definitively master the art


----------



## sptrawler

Ann said:


> Art of War 101
> 
> “The whole secret lies in confusing the enemy so that he cannot fathom our real intent.” ― Sun Tzu
> 
> “Engage people with what they expect; it is what they are able to discern and confirms their projections. It settles them into predictable patterns of response, occupying their minds while you wait for the extraordinary moment — that which they cannot anticipate.” – Sun Tzu



Unusual for investment people to put money into what will end up a stranded asset, unless they have other plans for the sites?


----------



## qldfrog

sptrawler said:


> Unusual for investment people to put money into what will end up a stranded asset, unless they have other plans for the sites?



Standed assets?..15y of increasing profit another 5y of extension after total grid collapse..all that for a pittance.great timing i think


----------



## Dona Ferentes

sptrawler said:


> Unusual for investment people to put money into what will end up a stranded asset, unless they have other plans for the sites?



from the article:

Led by the Asian Development Bank (ADB), multinational lender HSBC and the philanthropic foundations of Jeff Bezos  and the late John D. Rockefeller, the coalition is courting governments in south-east Asia with a plan to shut their relatively young coal-fired plants and replace them with low-emission alternatives [to establish] its “Energy Transition Mechanism” (ETM).

The financial architecture of the ETM is not settled, but the plan being devised by the bank’s energy specialist David Elzinga’s team envisages two funds.

The first fund would buy coal-fired power stations that are burdened by a high cost of capital, and use the fund’s lower cost of capital to settle the power station’s obligations sooner.



> _“It is basically a financial arbitrage_,” [ADB energy specialist David] Elzinga tells _The Australian Financial Review. _”_Following an ETM transaction, the plant would continue to operate but for a much shorter amount of time and still pay the financial obligations of the investment."_





> “_This would ensure the that the power system will be adequately supplied and just transition activities can be carried out to support those people and communities who depend on the power plants for their livelihood_.”




Premature retirement of power stations could also earn the first fund carbon credits, which could prove lucrative ...

The second fund would build low-emission power generation to replace the shuttered coal-fired stations and ensure the participating nations are not left with a degraded power supply at a time when their population is demanding more energy, not less.


----------



## Ann

qldfrog said:


> Stranded assets?..15y of increasing profit another 5y of extension after total grid collapse..all that for a pittance.great timing i think






Dona Ferentes said:


> The first fund would buy coal-fired power stations that are burdened by a high cost of capital, and use the fund’s lower cost of capital to settle the power station’s obligations sooner.






Dona Ferentes said:


> from the article:
> Premature retirement of power stations could also earn the first fund carbon credits, which could prove lucrative ...





How to provide cheap finance for coal-fired generation without gaining the ire of the CC mob. Fifteen years of guaranteed demand for coal.... works for me!


----------



## Garpal Gumnut

I am not as confident as others here that coal will be phased out in Australia within the mooted timeframes above. 

There are many headwinds to replacing coal with cleaner energy, not least living with Covid and its effect on rolling out alternative cleaner alternatives, blocked supply chains and manpower.

Why go to the expense of alternative technology when the present works, if one is beset by a perception of a greater danger than warming. I am not arguing against GW by the way, just how we can realistically change to safer energy.  

The Russians and Chinese seem to have got a better handle on this simple probable reality than the West. 

gg


----------



## Ann

Garpal Gumnut said:


> I am not as confident as others here that coal will be phased out in Australia within the mooted timeframes above.




It was only eleven years ago that Tesla listed on the NASDAQ, 13,300,000 shares of common stock were issued to the public at a price of US$17.00 per share.  Look at the uptake of EVs worldwide in such a short time frame. I am sure fifteen years will see us well on the way out of coal. I think the price of coal will see a new burst of energy (forgive the pun) for the short term. Let's see.

Here is the 12-year chart for coal, I am wondering if my yellow rising support/resistance line will offer support for the falling price?


----------



## qldfrog

Ann said:


> It was only eleven years ago that Tesla listed on the NASDAQ, 13,300,000 shares of common stock were issued to the public at a price of US$17.00 per share.  Look at the uptake of EVs worldwide in such a short time frame. I am sure fifteen years will see us well on the way out of coal. I think the price of coal will see a new burst of energy (forgive the pun) for the short term. Let's see.
> 
> Here is the 12-year chart for coal, I am wondering if my yellow rising support/resistance line will offer support for the falling price?
> 
> View attachment 133227



Yes sure.indeed what is the actual uptake of EV? .how many EV sold in 2021 vs ice?


----------



## Ann

qldfrog said:


> Yes sure.indeed what is the actual uptake of EV? .how many EV sold in 2021 vs ice?



"EV sales in H1 2021 nearly tripled worldwide compared to the first half of last year. Some of the increase can be attributed to slow vehicle sales caused by the pandemic in 2020. Share of EV sales in global passenger car sales doubled compared to the same period last year and now stands at 7% globally. There has not been a year when ICE sales were displaced at this rate."









						Electric vehicle sales to vault over 6 million in 2021
					

Global electric vehicle (EV) sales are expected to vault over 6 million this year, says Wood Mackenzie.




					www.woodmac.com


----------



## sptrawler

The thing is as Frog says a lot of the owners of some coal power stations will be looking for a way out, the banks etc are reluctant to lend money to them, the excessive cycling of the plant brings on maintenance issues and as Ann says they are on a definite time line.
The thing is there is lot of very expensive and essential infrastructure in place, eg transmission lines, switchyards and associated equipment, this leads to three possibilities, renewables, grid storage batteries, or at a later date possible SMR's.
It actually could be a master stroke.


----------



## qldfrog

Might reach 7% of cars in 2021
So 93% ice, 7% EV worldwideif ev sales tripple, they will reach the 20%....
Plenty of demands for fossil fuel, and restricted supplies so nice price jump.even better, these EVs will need power which for the time being will come from coal.
Nice future ahead for coal producers but maybe not for those located within the league of Woke of the west..and this will include Australia.


----------



## qldfrog

Ann said:


> "EV sales in H1 2021 nearly tripled worldwide compared to the first half of last year. Some of the increase can be attributed to slow vehicle sales caused by the pandemic in 2020. Share of EV sales in global passenger car sales doubled compared to the same period last year and now stands at 7% globally. There has not been a year when ICE sales were displaced at this rate."
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Electric vehicle sales to vault over 6 million in 2021
> 
> 
> Global electric vehicle (EV) sales are expected to vault over 6 million this year, says Wood Mackenzie.
> 
> 
> 
> 
> www.woodmac.com



Sorry was doing my searches and typing answer.was a bit slow so yes nearly 7%


----------



## Ann

This is somewhat encouraging for the price of coal and the profitability of the coalers..

''China may raise coal contract prices in 2022 after squeeze"

"China plans to raise the benchmark price for long-term coal contracts in 2022 after a supply scare earlier this year, adding to inflationary pressures faced by manufacturers.

The National Development and Reform Commission drafted a plan to set the benchmark rate for thermal coal at 700 yuan ($110) a tonne for long-term contracts, allowing prices to rise or fall within a 150 yuan band around it in monthly adjustments, according to people familiar with the plan. The agency is seeking opinions on the plan, the people said. The NDRC didn’t respond to a faxed request for comment."









						China may raise coal contract prices in 2022 after squeeze
					

Higher coal prices will likely mean steeper electricity costs for industrial customers.




					www.mining.com


----------



## Ann

More good news regarding coal...

"U.S. Coal Is Making A Transitory Comeback"









						U.S. Coal Is Making A Transitory Comeback | OilPrice.com
					

While the U.S. Administration is pushing its green energy agenda and wants to decarbonize the power grid by 2035, coal is making a comeback this year as high natural gas prices incentivize more coal use in electricity generation




					oilprice.com


----------



## divs4ever

yep  am glad i didn't dump my coal exposure 

 WHC  has been a roller-coaster ride for me bought @ $1.555 and $1.29 and reduced ( NOT sold out ) and  @ $3.55 both times

 exciting without any investment cash risk currently 

 ( have been less successful with NHC , but still looks to be fixable  , with timing and patience )


----------



## Craton

Can't see coal use ending any time soon especially when hydrogen can be extracted via gasification (and possibly other) methods.

As per the link to the Coal Age website 7th of May 2021 article:-



> Globally, around 130 coal gasification plants are in operation with more than 80% of them in China. In terms of gasification with carbon capture, there are currently three facilities producing hydrogen from coal, coke and petroleum coke at scale, with a combined capacity of around 0.6 MtH2/y, namely Great Plains and Coffeyville in the USA and Sinopec Qila in China. These plants demonstrate that large-scale production of low emissions hydrogen using carbon capture can already be technically and commercially feasible.


----------



## Ann

I must say this does not surprise me greatly....





__





						Global Coal Power Demand On Track For Record As Green Energy Transition Crumbles | ZeroHedge
					

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero




					www.zerohedge.com


----------



## Sean K

Ann said:


> I must say this does not surprise me greatly....
> 
> 
> 
> 
> 
> __
> 
> 
> 
> 
> 
> Global Coal Power Demand On Track For Record As Green Energy Transition Crumbles | ZeroHedge
> 
> 
> ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
> 
> 
> 
> 
> www.zerohedge.com




Victoria is going to be in deep doo doo when Loy Yang A and B are decommissioned early, unless some gigantic batteries are built, hydrogen is a real industrial level option, more Tassie hydro capacity can be somehow harnessed, or a nuclear plant/SMRs are ready to replace them.


----------



## sptrawler

Sean K said:


> Victoria is going to be in deep doo doo when Loy Yang A and B are decommissioned early, unless some gigantic batteries are built, hydrogen is a real industrial level option, more Tassie hydro capacity can be somehow harnessed, or a nuclear plant/SMRs are ready to replace them.



Yes there seems to be a lot of kicking the can down the road ATM, pledges and commitments, without much in the way of realistic alternatives.
I guess it's like everything else tell the unwashed masses what they want to hear, then they move on to the next issue to whinge about. 🤣


----------



## qldfrog

Ann said:


> I must say this does not surprise me greatly....
> 
> 
> 
> 
> 
> __
> 
> 
> 
> 
> 
> Global Coal Power Demand On Track For Record As Green Energy Transition Crumbles | ZeroHedge
> 
> 
> ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
> 
> 
> 
> 
> www.zerohedge.com



I feel like ROL then realise we are the big losers in this chain of wokeness and sheer incompetence


----------



## bk1

From the same report quoted by @Ann 
“China’s influence on coal markets is difficult to overstate. China’s power generation, including district heating, accounts for one-third of global coal consumption,”

and one from the wishful thinking brigade..(Ember, a climate think tank)
“Coal power will inevitably begin to decline soon: China has committed to phasing down coal from 2025, while India’s huge renewables target should remove the need for more coal.”


----------



## divs4ever

not if you bought coal producers in the dips and  sold the Australian  utility companies in a profit  ( but to be fair AST and SKI  are take-overs  so i didn't have much say in the profits crystallized )

 having been interested ( and wasting money in ) clean energy technology  this was clear to see coming ( like  a snail with truck spotlights on  high beam )

 the whole 'global warming thing started  as a tax scam , and a few well meaning  Greenies  jumped on hoping the 'dream' was true , a few politicians hoping for extra votes  .. and here we are  hoaxers , dreamers ,  and serial over-promisers .. and tax addicts 

and all the better tech should have gone into the under-developed nations FIRST to leverage the cheaper labour  , and harvest the development gains ( cheaper power means cheaper manufacturing and production )


----------



## Sean K

bk1 said:


> and one from the wishful thinking brigade..(Ember, a climate think tank)
> “Coal power will inevitably begin to decline soon: China has committed to phasing down coal from 2025, while India’s huge renewables target should remove the need for more coal.”




I really hope they are sincere, but I think geopoliticalsecurity issues will trump China and India following through. One of our only hopes for the democracies of the World is for India to develop more quickly, on the back of cheap, reliable energy. They need to bring about 500m out of poverty and build their economy and industrial base as rapidly as China did over the past 20 year, but fast track it to the next 10. Then there might be a nicer balance of power in the IndoPacific. The Quad on one side, and China/Russia on the other. The new democracies of ASEAN will support the Quad, so it'll all be on China to real themselves in. They are trapped by geography, which determines geopoliticalmiltary success and they don't have it. They're trapped. The only way they can really expand is to go NW. The Jesus nut for the Quad is the Andaman and Nicobar Islands, owned by India. India have fortressed the place and can shut it off to all traffic going from the Indian Ocean to the South China Sea. For China to take Taiwan, they'll actually need to secure that passage first, because if they pull the trigger first, India will just close it down and China are stuffed. I think I went off topic there. Anyway, India need cheap energy, for all our sakes.


----------



## sptrawler

Sean K said:


> . Anyway, India need cheap energy, for all our sakes.



Industrialisation takes a lot of power, as China has proven, India aren't going to do it with solar power. Maybe a lot of hydro in the Himalayan mountains, but one would think coal or gas has to play a major part also.


----------



## Smurf1976

sptrawler said:


> India aren't going to do it with solar power. Maybe a lot of hydro in the Himalayan mountains



That one's been thought of..... Entura Hydro Tasmania India Pvt Ltd is thing yes. So to the extent India dams its way to power, Australian expertise is going to be involved on the engineering side for some projects at least.

Coal's going to be a big part of it though at least for the medium term, no question there, the sheer scale of the country's population is such that parallel development of all energy forms is the most likely scenario. All as in wind, solar, hydro, coal, nuclear and so on. All.

From an investment perspective though it's not so straightforward since whilst it doesn't have an actual monopoly, state-owned Coal India is certainly very dominant in coal production in the country at present.


----------



## Smurf1976

Sean K said:


> Victoria is going to be in deep doo doo when Loy Yang A and B are decommissioned early



For the record for those unaware, there are two coal mines presently operating in Victoria.

Yallourn owned by Energy Australia which supplies coal exclusively to the adjacent Yallourn power station.

Loy Yang owned by AGL which sends about two thirds of production to AGL's Loy Yang A power station, about one third to rival company Alinta's Loy Yang B power station and minor amounts for other incidental buyers.

Yallourn is closing completely in 2028 on present plans, bringing a final end to an end an operation which commenced production in 1924 and which has operated almost continuously since that time.

Loy Yang will be shut completely by 2048 on present "official" plans but realistically most are expecting it to go somewhat sooner in practice. Loy Yang commercial scale production commenced in 1984 and reached full capacity in 1996.


----------



## Sean K

sptrawler said:


> Industrialisation takes a lot of power, as China has proven, India aren't going to do it with solar power. Maybe a lot of hydro in the Himalayan mountains, but one would think coal or gas has to play a major part also.




yes, I need to study up on rivers and where they flow from, but from my understanding of the Tibetan Plateau is that China took Tibet for long term grand strategic effect - control the water from the Himalayas. They have SE Asia fresh water in their control. I’m not sure how we missed that.


----------



## Sean K

Smurf1976 said:


> That one's been thought of..... Entura Hydro Tasmania India Pvt Ltd is thing yes. So to the extent India dams its way to power, Australian expertise is going to be involved on the engineering side for some projects at least.
> 
> Coal's going to be a big part of it though at least for the medium term, no question there, the sheer scale of the country's population is such that parallel development of all energy forms is the most likely scenario. All as in wind, solar, hydro, coal, nuclear and so on. All.
> 
> From an investment perspective though it's not so straightforward since whilst it doesn't have an actual monopoly, state-owned Coal India is certainly very dominant in coal production in the country at present.




I’d say long term. Hundreds of new coal plants are being built and will be in operation for decades, probably into the 2100s. From a ‘end is nigh’ perspective with the continued use of FF, how do we reconcile that? We need to stop Asia developing with FF or provide FF free alternatives for them. In the next few years Chindia will be the two biggest economies in the World. Obviously, Joe Blow in the streets of Melbourne is not going to support that.

I‘ll say it again, geostrategicsecurity imperatives will trump coral bleaching. Chindia will do all they can to catch up to the West.


----------



## Sean K

Smurf1976 said:


> For the record for those unaware, there are two coal mines presently operating in Victoria.
> 
> Yallourn owned by Energy Australia which supplies coal exclusively to the adjacent Yallourn power station.
> 
> Loy Yang owned by AGL which sends about two thirds of production to AGL's Loy Yang A power station, about one third to rival company Alinta's Loy Yang B power station and minor amounts for other incidental buyers.
> 
> Yallourn is closing completely in 2028 on present plans, bringing a final end to an end an operation which commenced production in 1924 and which has operated almost continuously since that time.
> 
> Loy Yang will be shut completely by 2048 on present "official" plans but realistically most are expecting it to go somewhat sooner in practice. Loy Yang commercial scale production commenced in 1984 and reached full capacity in 1996.




Thanks for expanding Smurf. The last thing I read was that shut downs were being brought forward by years and the energy regulator was concerned with a gap between supply and demand. It’s all over the news. The major risk is that there is no definite solution for 24/7 power, just hope. It’s only a decade away.


----------



## Sean K

And, while I’m at grand strategic planning, which is 50+ years into the future, if Western democracies see China as a threat, we need to start cutting off their supply now, to send a message. We are in control, but for not much longer. Unfortunately, short term political gain through our democraticly elected government system can‘t really see past the next election cycle which makes us vulnerable. My crystal ball tells me this is going to pan out like what happened in the SW Pacific in WW2. China will go on an adventure, but then be cut off, and lose. Um, coal is the topic, so, they will run out of fuel and iron ore.


----------



## divs4ever

Sean K said:


> I’d say long term. Hundreds of new coal plants are being built and will be in operation for decades, probably into the 2100s. From a ‘end is nigh’ perspective with the continued use of FF, how do we reconcile that? We need to stop Asia developing with FF or provide FF free alternatives for them. In the next few years Chindia will be the two biggest economies in the World. Obviously, Joe Blow in the streets of Melbourne is not going to support that.
> 
> I‘ll say it again, geostrategicsecurity imperatives will trump coral bleaching. Chindia will do all they can to catch up to the West.



 catch ??

 overtake more likely 

 unless Chindia  are more fascinated  by space  expansion/exploration


----------



## Sean K

divs4ever said:


> catch ??
> 
> overtake more likely
> 
> unless Chindia  are more fascinated  by space  expansion/exploration




Eventually, way overtake. Unless they implode. Both countries at risk of internal division.


----------



## divs4ever

well i wouldn't call India united yet  , i see them as still feeling their way forward from British rule 

 i see them becoming a monster , whether that is a good monster or a not so good one is yet to be seen 

 and yes i am still looking carefully  for more ways to get exposure to India  

 further to this i see a potential  'trading bloc ' of India , Bangladesh  ,  Sri Lanka  and Pakistan  (  although Pakistan  might have to let the 'tribal lands ' merge with Afghanistan ) , it will be interesting to see who joins the bloc  , that also might resolve Kashmir 

 China is used to resisting division ( often resorting to massive brutality ) assuming Russia stays on the sidelines , good luck trying to divide China in it's own homeland ( using external forces ) one would have thought Korea was warning enough .. an internal regime change  could turn out very badly also .

 i don't love the CCP but this regime is more refined than some predecessors things could be much worse


----------



## bluekelah

Sean K said:


> And, while I’m at grand strategic planning, which is 50+ years into the future, if Western democracies see China as a threat, we need to start cutting off their supply now, to send a message. We are in control, but for not much longer. Unfortunately, short term political gain through our democraticly elected government system can‘t really see past the next election cycle which makes us vulnerable. My crystal ball tells me this is going to pan out like what happened in the SW Pacific in WW2. China will go on an adventure, but then be cut off, and lose. Um, coal is the topic, so, they will run out of fuel and iron ore.




I wouldnt worry too much about China, they now have too much internal debt, compounded by a shrinking population. The whole economic growth story there is predicated on rising house prices  They will very likely than not go the way of Japan in the 1990s once their property bubble pops and banking sector goes down. 

India is another mega country that's just a big mess. They are struggling with overpopulation and very very bad infrastructure, from what i read their power grid is a mess, and just look at what happened with the last covid wave, what a mess.


----------



## Smurf1976

Sean K said:


> Thanks for expanding Smurf. The last thing I read was that shut downs were being brought forward by years and the energy regulator was concerned with a gap between supply and demand.



Yallourn closure date has officially been moved forward.

Original plan was to close one of the four generating units each year 2029, 2030, 2031, 2032.

New plan is to close the whole lot in 2028. Mine and power station all shuts in one go.

In short the operation has become financially extremely marginal, not helped by the structural problems with the mine which threaten to flood it and need ~$150 million to fix immediately.

A deal has been done between Energy Australia and the Victorian state government which keeps it open through to 2028 then it's game over.

For Loy Yang the "official" date hasn't changed, it's still 2047-48, but you'd be hard pressed to find anyone who isn't expecting that to be moved forward in practice.

AEMO (Australian Energy Market Operator) have recently suggested 2032, noting that's them forecasting what they expect will occur (as distinct from directing that it must occur which isn't their role) Personally I'm unconvinced it'll be quite that soon but I do expect it to be in the 2030's.

The overall trend for power generation from coal in Australia is pretty clear as the following chart shows. This includes data for all states including those not part of the National Electricity Market. Basis is calendar year so 2021 is incomplete obviously (and ignore 1998 as that's only a couple of weeks' worth).




So to the extent anyone's investing in coal, pay attention to the export market. It's already a doomed industry in the Australian domestic context and anyone saying otherwise is simply playing politics.

2020 volume was down more than 24% from the peak year, 2008, and the downtrend continues.


----------



## divs4ever

can't be completely  doomed the QLD Government is  promising hydrogen  powered train engines to track QLD coal to port 

 i am guessing it will take at least  3 years to build the first successful engine ,

 but they will plenty more to keep up for mine production ( assuming Adani never gets a green-light  and the New Hope project never gets approval for the expansion )


----------



## divs4ever

so i am guessing   there is a pivotal election soon and the ALP needs to pander to both sides of the left ( Greens and CFMEU )


----------



## Smurf1976

divs4ever said:


> can't be completely doomed the QLD Government is promising hydrogen powered train engines to track QLD coal to port




Just because there's a downtrend in use locally doesn't mean the same is true globally. That coal would be for export mostly.


----------



## divs4ever

i suspect it will be mostly for export and political grandstanding ( and tax-gouging )

 i can only hope the enduring companies  can make a profit ( and pay divs  )

 it will be interesting to see how QLD fills it's power needs if it exports  the LNG and and coal  we don't have that much hydro  , plenty of sunshine in the daylight , but sometimes brutal winds  and the population is spread out  ( much bigger than Victoria or NSW )


----------



## qldfrog

bluekelah said:


> I wouldnt worry too much about China, they now have too much internal debt, compounded by a shrinking population. The whole economic growth story there is predicated on rising house prices  They will very likely than not go the way of Japan in the 1990s once their property bubble pops and banking sector goes down.
> 
> India is another mega country that's just a big mess. They are struggling with overpopulation and very very bad infrastructure, from what i read their power grid is a mess, and just look at what happened with the last covid wave, what a mess.



Perception and wish ful thinking of your media outlets
... Japan 30y after their so called demise is still a mega country and one of the nicest place on earth to live
No immigration, a doomed policy europe and the us citizens can now only dream of.
Remaining united as a culture and country

China: they just produce and make *everything*,not only your crap stuff,have full control on the world already and our greed make it unstoppable.still laughting to the cash teller after covid and CC green moves of the west.United as a country.
India ..a mess but whatever your propaganda tells you,bdid much better with covid than Europe or the us.hardly anyone jabbed but they allowed treatment..can sometimes be great not to be able to afford Pfizer....
I do not believe in India as superpower but i could be wrong.especially after discovering,feet on ground, the misconceptions with China.
Back to coal: here to stay for a long time..decades.
Did not too badly with coal this year but now out.
As with crypto, the risk is the narrative/western politicians forcing closure of these assets.
The asx could soon have no coal assets or companies flogged with extra taxes the coal will be mined and burnt, but not by western companies we will be able to invest in... pure capitalism is long dead here.


----------



## Ann

Another interesting article in the WSJ, I can't read it all but I can get the gist of it. I am wondering if they have decided, 'good money, after bad'?









						WSJ News Exclusive | Investors Balk at Plan to Buy Coal Mines and Close Them
					

Citigroup and its partners shelved an investment fund they said would put an end date on thermal-coal mines to lower carbon emissions.




					www.wsj.com
				




I know some here may have vastly forward plans on the viability of coal and whatever, 
I on the other hand have a one year view! So I am happy with this article 









						Coal power’s sharp rebound is taking it to a new record in 2021, threatening net zero goals - News - IEA
					

Coal power’s sharp rebound is taking it to a new record in 2021, threatening net zero goals - News from the International Energy Agency




					www.iea.org


----------



## divs4ever

coal mines are expensive to close and repatriate  , maybe somebody forgot to add that to  their reckoning ( if you bankrupt the mine , not only do you lose royalties and jobs , but the government/public  get  to pick up the tab  ... or worse still the INSURANCE companies  .. you now the little darlings that always get bailed out )

 and think of the financial instruments  riding on the coal industry  ( the banks  and fund managers feed on them )

 if they REALLY worried about the future  , why not boycott funding nuclear ( and biological ) weapons research  ( either is more likely to kill us quicker than air pollution )


----------



## Sean K

The headlines will continue on this for some time. I'm still not sure how I feel about it.

Cheap, reliable energy in natural abundance, that turned us into the most prosperous country in the World per capita / land mass.

And, we're giving up that advantage.

From a national security perspective, it's bonkers.


----------



## bluekelah

qldfrog said:


> Perception and wish ful thinking of your media outlets
> ... Japan 30y after their so called demise is still a mega country and one of the nicest place on earth to live
> No immigration, a doomed policy europe and the us citizens can now only dream of.
> Remaining united as a culture and country
> 
> China: they just produce and make *everything*,not only your crap stuff,have full control on the world already and our greed make it unstoppable.still laughting to the cash teller after covid and CC green moves of the west.United as a country.
> India ..a mess but whatever your propaganda tells you,bdid much better with covid than Europe or the us.hardly anyone jabbed but they allowed treatment..can sometimes be great not to be able to afford Pfizer....
> I do not believe in India as superpower but i could be wrong.especially after discovering,feet on ground, the misconceptions with China.
> Back to coal: here to stay for a long time..decades.
> Did not too badly with coal this year but now out.
> As with crypto, the risk is the narrative/western politicians forcing closure of these assets.
> The asx could soon have no coal assets or companies flogged with extra taxes the coal will be mined and burnt, but not by western companies we will be able to invest in... pure capitalism is long dead here.



Nothing to do with media outlet, its just what happened in history and whats happening right now.

Japan had decades of subpar economic growth following the 1990s collapse and lost decades. Sure they are a mega country , nice clean streets, efficient transport etc in cities, but they are nothing to worry about.

China does not MAKE EVERYTHING. I have things like plastic coin capsules for my silver/gold coins that are fully made in USA.
Even if you talk electronics and tech stuff, Lotsa electronics stuff I had as a kid was made in Japan. Lotsa stuff is now made in China but not everything.  Top wafer fab TSMC has foundries in Taiwan/USA and China.Theres lotsa stuff like ships/containers/oil rigs/military weapons NOT made in China. And of course all the food I eat is not produced in China. Even simple stuff like STEEL is made locally in Japan/Europe/USA/etc. though CHina has been trying to undercut and monopolise the sector.

In addition, a lot of manufacturing is moving out, smaller countries like Vietnam (yep thats where Samsung has gone, not China) are going gangbusters. Pretty much as costs eventually rise too much in China, manufacturing will move out. Covid and China's iron fisted response has also caused many companies to move some production out to reduce concentration risk. 

Population wise China is going the same way as Japan, why do you think the 1chil policy has become a 2 and then this year a 3 child policy?

Property bubble is plain to see if you are on the ground in china, theres just ghost cities and endless miles of non occupied housing.
united country or not, when population growth goes negative, its hard to manage that and it will limit China the same way it limits Japan and many other developed nations. A developed Chinese economy growing at 2% GDP or less a year is not gonna be much of a threat.

As I said in my response to the previous post, nothing to worry about, we dont have to cut coal or other  supplies to them.


----------



## divs4ever

from my observation  , when nations become more stable  , and better developed there is less pressure to have large families   , and less large families  flows on the whole economy ( less people  likely to starve  )

 now China came in with a policy  , that probably looked clever at the time , but many nations now  have shrinking , aging populations ( if your  ignore immigration )  it just maybe rising living standards  , was all that was needed  ( India should be educational if my observations are correct  , as it MUST reduce internal  bottle-necks and bring in safe water )


----------



## qldfrog

bluekelah said:


> Nothing to do with media outlet, its just what happened in history and whats happening right now.
> 
> Japan had decades of subpar economic growth following the 1990s collapse and lost decades. Sure they are a mega country , nice clean streets, efficient transport etc in cities, but they are nothing to worry about.
> 
> China does not MAKE EVERYTHING. I have things like plastic coin capsules for my silver/gold coins that are fully made in USA.
> Even if you talk electronics and tech stuff, Lotsa electronics stuff I had as a kid was made in Japan. Lotsa stuff is now made in China but not everything.  Top wafer fab TSMC has foundries in Taiwan/USA and China.Theres lotsa stuff like ships/containers/oil rigs/military weapons NOT made in China. And of course all the food I eat is not produced in China. Even simple stuff like STEEL is made locally in Japan/Europe/USA/etc. though CHina has been trying to undercut and monopolise the sector.
> 
> In addition, a lot of manufacturing is moving out, smaller countries like Vietnam (yep thats where Samsung has gone, not China) are going gangbusters. Pretty much as costs eventually rise too much in China, manufacturing will move out. Covid and China's iron fisted response has also caused many companies to move some production out to reduce concentration risk.
> 
> Population wise China is going the same way as Japan, why do you think the 1chil policy has become a 2 and then this year a 3 child policy?
> 
> Property bubble is plain to see if you are on the ground in china, theres just ghost cities and endless miles of non occupied housing.
> united country or not, when population growth goes negative, its hard to manage that and it will limit China the same way it limits Japan and many other developed nations. A developed Chinese economy growing at 2% GDP or less a year is not gonna be much of a threat.
> 
> As I said in my response to the previous post, nothing to worry about, we dont have to cut coal or other  supplies to them.



I hope you are right,we can agree to disagree.
Right now,this is being tested.it is pretty clear in my mind that the covid crisis is just a pretext to the start of an hotter economic war/ confrontation China/west.
food indeed is the weak point of China,not population aging.but i think they can overcome that with alliances being built and takeover of africa
I was feet on ground for 3y, up to covid in mainland China, Guandong province,i saw these new cities but i also saw the matching refineries,factories and infrastructure.
And i saw Europe,the US at the same time.i also see that it is very hard to find anything not build in china in Australia.
much to worry about,
quite too late to just worry about in my opinion.
but in the context of this specific thread,this is good.
It means more coal use by China in the next decade
And India backwardness and on going population growth means they will then take over coal capacity ,whatever China will leave as they move to cleaner energy.


----------



## Smurf1976

qldfrog said:


> ,we can agree to disagree.



An important point worth highlighting in the context of the whole debate and one that is very often lost in the wider world (outside this forum).

Energy's a subject where even if someone gets it factually 100% correct, saying it publicly can be dangerous since many have a strong ideological view and are simply closed to hearing anything which contradicts it. 

Personally I'm more than open to all ideas, including those I disagree with, but at the same time I'm well aware that an energy company CEO was forced to resign not too long ago immediately after they publicly commented about coal not being the future. Expressing an opinion, even a well informed one, can be dangerous.

It's hard to escape politics where energy of any form is concerned and that's especially so with coal. But yes, all views ought be heard and this forum is one of the very few places where discussion does remain civilised.


----------



## divs4ever

qldfrog said:


> And India backwardness and on going population growth means they will then take over coal capacity ,whatever China will leave as they move to cleaner energy.



 maybe NOT , depending on who leads India into the future  , i half expect a leap to nuclear  power  (  unless the wave-power folks get their act together )

 India was lots of infrastructure bottle-necks  , not endemic low IQs  i expect them to see affordable , efficient ways forward  ,  leap-frogging some usual progression ( say bypassing gas/diesel power-plants )

 now i hold some coal stocks  and hope i am absolutely  wrong  but i see South America and Africa is bigger coal power users  ( and using coal to make steel as well )


----------



## sptrawler

divs4ever said:


> maybe NOT , depending on who leads India into the future  , i half expect a leap to nuclear  power  (  unless the wave-power folks get their act together )
> 
> India was lots of infrastructure bottle-necks  , not endemic low IQs  i expect them to see affordable , efficient ways forward  ,  leap-frogging some usual progression ( say bypassing gas/diesel power-plants )
> 
> now i hold some coal stocks  and hope i am absolutely  wrong  but i see South America and Africa is bigger coal power users  ( and using coal to make steel as well )



My guess is, the only way for us specifically to rapidly close down coal, is to move quickly to gas turbines/ renewables + storage, as we have the ability to fill all those spaces.
Then when that is completed, IMO there will be a move toward nuclear, this will then allow the turbines to be used as another dispatchable/ storage medium using H2, how other countries do it is anyone's guess.lol


----------



## bluekelah

qldfrog said:


> I hope you are right,we can agree to disagree.
> Right now,this is being tested.it is pretty clear in my mind that the covid crisis is just a pretext to the start of an hotter economic war/ confrontation China/west.
> food indeed is the weak point of China,not population aging.but i think they can overcome that with alliances being built and takeover of africa
> I was feet on ground for 3y, up to covid in mainland China, Guandong province,i saw these new cities but i also saw the matching refineries,factories and infrastructure.
> And i saw Europe,the US at the same time.i also see that it is very hard to find anything not build in china in Australia.
> much to worry about,
> quite too late to just worry about in my opinion.
> but in the context of this specific thread,this is good.
> It means more coal use by China in the next decade
> And India backwardness and on going population growth means they will then take over coal capacity ,whatever China will leave as they move to cleaner energy.



for sure there will be some tussles between megapowers like China+Rus vs USA+allies, some of it will be political as well one side being communist and one side democratic. 

I dont think Oz can make any difference in that being just a small nation with sub ~26m population vs USA 300+Million and china almost 1.5 Billion pop. It will be a very eventful decade to come. Change of world order? Unfortunately we will always be supporting USA as there is a "debt" to be paid for their aid in WW2. 

As for coal, I think i read usage has dropped 4% last year due to covid but has since had a big rebound in usage this year. 

ENergy transition wont be that quick, there's a lot of infrastructure needs to be built and also mines/refineries started to produce stuff like uranium/natural gas/etc.. Even Solar u need heaps of silver/ EVs batteries need rare minerals. If production in any component mineral doesnt keep up, prices will skyrocket and slow down any transition. 

And all the supposed EV targets, wheres all the energy gonna come from in next 5 years? takes quite a few years to put in those hydro/wind/solar farms and batteries. And when the wind dont blow or the sun dont shine in winter? What you gonna burn thats cheap and readily available? Uranium prices have doubled, LPG has tripled. COAL is the answer! COAL to heat homes and power EVs. China has been an example this year using coal to solve their power crunch/blackouts. And now Europes burning coal as renewables are not sufficient and they need to heat homes. Germany is on track to burn more coal this year than last year...

So yeah i reckon good days ahead for next 10 years at the very least for our coal miners.


----------



## qldfrog

bluekelah said:


> for sure there will be some tussles between megapowers like China+Rus vs USA+allies, some of it will be political as well one side being communist and one side democratic.
> 
> I dont think Oz can make any difference in that being just a small nation with sub ~26m population vs USA 300+Million and china almost 1.5 Billion pop. It will be a very eventful decade to come. Change of world order? Unfortunately we will always be supporting USA as there is a "debt" to be paid for their aid in WW2.
> 
> As for coal, I think i read usage has dropped 4% last year due to covid but has since had a big rebound in usage this year.
> 
> ENergy transition wont be that quick, there's a lot of infrastructure needs to be built and also mines/refineries started to produce stuff like uranium/natural gas/etc.. Even Solar u need heaps of silver/ EVs batteries need rare minerals. If production in any component mineral doesnt keep up, prices will skyrocket and slow down any transition.
> 
> And all the supposed EV targets, wheres all the energy gonna come from in next 5 years? takes quite a few years to put in those hydro/wind/solar farms and batteries. And when the wind dont blow or the sun dont shine in winter? What you gonna burn thats cheap and readily available? Uranium prices have doubled, LPG has tripled. COAL is the answer! COAL to heat homes and power EVs. China has been an example this year using coal to solve their power crunch/blackouts. And now Europes burning coal as renewables are not sufficient and they need to heat homes. Germany is on track to burn more coal this year than last year...
> 
> So yeah i reckon good days ahead for next 10 years at the very least for our coal miners.



well, @bluekelah I agree 100% with that last post of yours so we can also agree to agree;
[except for the part you mention our side as being democratic  ]
Let's all have a great xmas


----------



## Ann

This will be interesting to watch...


_Indonesia miners seek solution as coal export ban rattles sector_​_
JAKARTA/CHENNAI, Jan 3 (Reuters) - Indonesian coal miners want a quick resolution to a government coal export ban that has caused fuel prices to rise and could disrupt the energy supplies of some of the world's biggest economies.

The world's leading exporter of thermal coal on Saturday banned the shipments because of concerns it could not meet its own power demand, prompting President Joko Widodo on Monday to threaten to revoke business permits for any miners who failed to meet domestic market requirements...._









						Indonesia miners seek solution as coal export ban rattles sector
					

Indonesian coal miners want a quick resolution to a government coal export ban that has caused fuel prices to rise and could disrupt the energy supplies of some of the world's biggest economies.




					www.reuters.com


----------



## divs4ever

i hold ATM  ( where the Government owns a stake in the company .. well last i read it did)

 so i suppose the question is , power needs of the public  , or power needs of the miners , blast furnaces , and other corporate entities  ( because ATM uses it's mined coal to  feed the gold refinery and ferro-nickel  smelting )

 but i suppose the Government means the big multi-nationals


----------



## Ann

divs4ever said:


> i hold ATM  ( where the Government owns a stake in the company .. well last i read it did)
> 
> so i suppose the question is , power needs of the public  , or power needs of the miners , blast furnaces , and other corporate entities  ( because ATM uses it's mined coal to  feed the gold refinery and ferro-nickel  smelting )
> 
> but i suppose the Government means the big multi-nationals



I am not seeing any mention of Coal mining from ATM 








						Antam - Wikipedia
					






					en.wikipedia.org


----------



## eskys

Saw an article this morning written by a Switzer guy on AZJ (I don't hold) 

3. Aurizon Holdings (AZJ)​
Who would want to own companies heavily exposed to coal, such is the growing reallocation of capital away from fossil-fuel industries? Rail-operator Aurizon still makes most of its money transporting coal in Queensland and New South Wales.


Yes, coal-logistic companies have plenty of long-term challenges, particularly those that do not transition into other forms of freight (Aurizon is quickly growing its bulk-freight business). But every stock has its price and negative market sentiment can drive prices too low.


That is the case with Aurizon. A recovering global economy next year should underpin coal demand and possibly higher coal prices. Aurizon’s coal business might not be popular with Environmental, Social and Governance (ESG) investors, but rail is still vital for coal.


In October, Aurizon announced it will acquire One Rail Australia (ORA) for $2.35 billion as part of its diversification into bulk-rail haulage and freight. Aurizon committed to selling or demerging ORA’s coal-haulage business, amid competition concerns. The acquisition looks like a smart long-term move for Aurizon as it beefs up its bulk-freight business.


A consensus share price target of $3.71 for Aurizon (it’s $3.39 now) is too bearish. Morningstar’s fair value for Aurizon is $4.70. I’m not quite as bullish as Morningstar but see decent upside for Aurizon over the next few years.


----------



## Ann

eskys said:


> A consensus share price target of $3.71 for Aurizon (it’s $3.39 now) is too bearish. Morningstar’s fair value for Aurizon is $4.70. I’m not quite as bullish as Morningstar but see decent upside for Aurizon over the next few years.




 I reckon this stock has a co-ordinated short happening, just looking at the chart, although I note that Vanguard sold its holdings but that is not to say they aren't back in, in a smaller way. Blackrock is still a major holder.


----------



## eskys

Not sure what's happening there, Ann. I don't trade or follow AZJ. It's one of 5 that was mentioned in the article I was reading this morning. The other 4 mentioned were QAN, QBE, VCX and CGF. I was trying to find out where to post but found an old thread on VCX going back to 2016 just then. Thought if I persist, I might find one more up to date, but now decided to drop it here.

By the way, this is what I found on Commsec's write up on AZJ, as follows...

AZJ appears to have completed a medium-term rally that took the 5-day moving average above the 50-day moving average and will likely continue its bearish trend. The 20-day moving average is downward sloping and appears set to continue the long-term bearish trend exhibited in the 200-day moving average.

 View AZJ Charting


----------



## Smurf1976

bluekelah said:


> COAL to heat homes and power EVs.



Agreed with the rest but I'll be very surprised if we see coal make a comeback as a domestic heating fuel in developed countries at least.

Urban air pollution is a very real downside, the amount of human labour required is another and it's expensive too given the cost of physically distributing the stuff. Consumers simply aren't keen on moving around a few tonners of the stuff each year, with their own manual labour, and getting themselves covered in dust while doing so. It's a last resort option for most, something you do only if you've got no alternative - homes in the US started to seriously move away from coal as a heat source as far back as the 1920's for example, given a choice consumers just didn't want it.

Coal-fired electricity on the other hand is a different matter. That heats homes just fine yes.

So coal demand is up yes, I just don't foresee anyone being keen to burn the stuff at home unless they're poor, have no choice or the few who just like it.


----------



## divs4ever

ATM

 from the half yearly report  ending June 2020 


Entitas anak/ Domisili/ Jenis usaha/ Percentage of ownership commercial Total assets before elimination Subsidiaries Domicile Nature of business 2020 2019 operations 2020 2019 Kepemilikan langsung/Direct ownership: 


2. PT Indonesia Coal Resources (“ICR”) Indonesia Perdagangan, transportasi dan jasa tambang batubara/ Coal mining trade, transportation and services 100.00% 100.00% 2010 44,474,171 28,122,883

14. PT Citra Tobindo Sukses Perkasa (“CTSP”) (melalui ICR/through ICR) Indonesia Eksplorasi dan operator tambang batubara/ Coal mining exploration and operator 100.00% 100.00% 2011 38,479,739 20,512,088

 that exposure may have been divested since , or ignored as trivial  compared to other arms  of the business in recent times


----------



## qldfrog

Smurf1976 said:


> Agreed with the rest but I'll be very surprised if we see coal make a comeback as a domestic heating fuel in developed countries at least.
> 
> Urban air pollution is a very real downside, the amount of human labour required is another and it's expensive too given the cost of physically distributing the stuff. Consumers simply aren't keen on moving around a few tonners of the stuff each year, with their own manual labour, and getting themselves covered in dust while doing so. It's a last resort option for most, something you do only if you've got no alternative - homes in the US started to seriously move away from coal as a heat source as far back as the 1920's for example, given a choice consumers just didn't want it.
> 
> Coal-fired electricity on the other hand is a different matter. That heats homes just fine yes.
> 
> So coal demand is up yes, I just don't foresee anyone being keen to burn the stuff at home unless they're poor, have no choice or the few who just like it.



I assume it was meant: load the grid and heat the home via electric heater or heatpump at night


----------



## Ann

divs4ever said:


> 2. PT Indonesia Coal Resources (“ICR”) Indonesia Perdagangan, transportasi dan jasa tambang batubara/ Coal mining trade, transportation and services 100.00% 100.00% 2010 44,474,171 28,122,883




It may be related to this buying and selling Coal Mining business permits....


_*AGO Detains One Corruption Suspect In Antam's Subsidiary*_​_JAKARTA - Investigators from the Attorney General's Office (Kejagung) have arrested one suspect in the alleged corruption case of buying and selling coal mining business permits (IUP) in Sarolangun Regency, Jambi by a subsidiary of PT Antam Tbk.

The detention of one suspect with the initials AT increased the number of suspects detained by the Attorney General's Office investigators. There are five people detained out of a total of 6 suspects

"The suspect AT is being held for the next 20 days at the Salemba Rutan at the South Jakarta District Attorney's Office," said the head of the AGO's Legal Information Center (Kapuspenkum) Leonard Eben Ezer Simanjuntak, quoted by Antara, Thursday, June 3.

The suspect AT was taken to the Salemba Rutan at the South Jakarta District Attorney's Office (Kejari), after undergoing a preliminary examination at the Junior Attorney General's Roundabout for Special Crimes at 17:46 WIB._

read more...








						AGO Detains One Corruption Suspect In Antam's Subsidiary
					

Investigators from the Attorney General's Office (Kejagung) have arrested one suspect in the alleged corruption case of buying and selling coal mining business permits (IUP) in Sarolangun Regency,




					voi.id
				






Edit: Very hard to know of course when it is a foreign company just with an Aussie listing.


----------



## bluekelah

Smurf1976 said:


> Agreed with the rest but I'll be very surprised if we see coal make a comeback as a domestic heating fuel in developed countries at least.
> 
> Urban air pollution is a very real downside, the amount of human labour required is another and it's expensive too given the cost of physically distributing the stuff. Consumers simply aren't keen on moving around a few tonners of the stuff each year, with their own manual labour, and getting themselves covered in dust while doing so. It's a last resort option for most, something you do only if you've got no alternative - homes in the US started to seriously move away from coal as a heat source as far back as the 1920's for example, given a choice consumers just didn't want it.
> 
> Coal-fired electricity on the other hand is a different matter. That heats homes just fine yes.
> 
> So coal demand is up yes, I just don't foresee anyone being keen to burn the stuff at home unless they're poor, have no choice or the few who just like it.



yeah what i meant was coal being used more in power plants to make electricity for heating during this european winter in "green" countries like germany, etc...


----------



## sptrawler

Indonesia feeling the energy squeeze, it will reduce coal exports, to bolster local supplies to power stations.









						Could Australia win from Indonesia's shock suspension of coal exports?
					

A decision by the Indonesian government to suspend some thermal coal exports to guarantee domestic supply could have a flow-on effect for Australian miners locked out of the China market.




					www.abc.net.au


----------



## qldfrog

sptrawler said:


> Indonesia feeling the energy squeeze, it will reduce coal exports, to bolster local supplies to power stations.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Could Australia win from Indonesia's shock suspension of coal exports?
> 
> 
> A decision by the Indonesian government to suspend some thermal coal exports to guarantee domestic supply could have a flow-on effect for Australian miners locked out of the China market.
> 
> 
> 
> 
> www.abc.net.au



If it works like other markets, Singapore  or Lichtenstein will become our biggest export markets for thermal coal, and Singapore mines will become the biggest suppliers of coal imports to China 😂


----------



## Garpal Gumnut

China to up burning coal this year.

https://oilprice.com/Energy/Coal/China-Looks-To-Run-Coal-Fired-Power-Plants-At-Full-Capacity.html

gg


----------



## Sean K

Coal miners still doing OK in the US.

From AFR:


----------



## Sean K

But, maybe it will be short lived.

cont from AFR article:


----------



## Sean K

Noticed a couple of coal companies do ok yesterday.


----------



## Sean K

Any guesses on when then music stops?


----------



## Dona Ferentes

The squeeze higher in commodity prices was bolstered by reports of foreign companies declining to purchase or ship Russian supplies, including crude oil, and was felt around the world.

The price for top quality Australian _*coking coal surged above $US500 per tonne*_, and local *thermal coal prices reached $US400 per tonne*, both record highs.

Russia is a major exporter of intermediate coking coal for steelmaking and thermal coal for power generation, and the Ukraine crisis and related sanctions on Russia spurred Asian customers to buy any type of coal they could find in expectation of a broader supply shortage.


----------



## qldfrog

https://finance.yahoo.com/news/china-buys-cheap-coking-coal-061116768.html
Please note that the russian price while discounted is still higher than last year:
So Russia wins a bit, China wins a lot and the other suckers economies lose except for maybe heavy coal mining countries..which will still get the inflation..


----------



## divs4ever

qldfrog said:


> https://finance.yahoo.com/news/china-buys-cheap-coking-coal-061116768.html
> Please note that the russian price while discounted is still higher than last year:
> So Russia wins a bit, China wins a lot and the other suckers economies lose except for maybe heavy coal mining countries..which will still get the inflation..



 yes the Russians are long term clever like that , but when i have had partnerships with Chinese ( ethnics ) that strategy works very smoothly and reliably ( Russia will consider a stable customer a win  in itself )


----------



## qldfrog

Mirroring another coal thread, numbers are not good for us as a coking coal exporter medium term








						China Calls Out U.S. Dollar Dominance As It Buys Russian Coal With Yuan | OilPrice.com
					

The first shipments of Russian commodities paid for in yuan are set to arrive in China in April and May, and Beijing’s state media is using it as an opportunity to claim the status of the U.S. dollar is “at risk”




					oilprice.com


----------

