A roundup of international coal news from Jan. 16 to Jan. 23.
The United Nations Economic Commission announced Jan. 19 that it signed a memorandum of understanding with the World Coal Association outlining a plan to facilitate a dialogue between governments and the coal industry. The MOU is aimed at boosting awareness related to coal's role in the global energy mix, including its affordability and reliability as an energy source.
Canada: Cline Group LLC's Canada-based Donkin underground coal mine will commence operation before the end of January and is aimed at producing mostly metallurgical coal, along with a smaller amount of steam coal, Coal Age reported Jan. 19. After much delay last year, it is now expected to have up to 120 full-time workers and is projected to ramp up coal production to roughly 2.75 million tonnes annually by the end of 2017 or early 2018, said the report.
United Kingdom: Rio Tinto reported year-over-year increases in production across most of the commodities it produces for both the fourth quarter and full-year 2016. Hard coking coal production jumped 15% to 2.2 million tonnes in the fourth quarter, versus the same quarter of 2015, and 4% year over year to 8.1 million tonnes in 2016. Fourth-quarter semisoft and thermal coal production, however, tumbled 13% to 5.2 million tonnes, compared to the prior corresponding period, and for the full year, slid 4% to 21.4 million tonnes.
China: China Shenhua Energy Co. Ltd. witnessed a 6.6% jump in coal sales in 2016. The company sold 394.9 million tonnes in 2016, compared to 370.5 million tonnes in the previous year. China Shenhua on Jan. 22 said the increase was primarily due to a substantial hike in the volume of coal purchased from third parties as a result of favorable market conditions.
China Coal Energy Co. Ltd. is expecting to book a net profit attributable to shareholders of between 1.80 billion Chinese yuan and 2.20 billion yuan for 2016, according to a Jan. 20 statement. China Coal attributed the turnaround to a rebound in the coal price, optimized product mix, lower costs and the disposal of noncore and underperforming assets.
China's coal production inched up 1% over the previous month to 311 million tonnes in December 2016, representing its highest level in a year, Reuters reported Jan. 20, citing the National Bureau of Statistics. The augmented output was spurred by strong demand from utilities during the winter. China's coal production experienced three consecutive monthly increases through December but was down 3% year over year, said the report.
Further, the country's central government, through the National Energy Administration, suspended 101 coal-fired power projects, which equates to more than 100 GW of aggregate installed capacity, the Caixin media group reported. The country's energy regulator issued notices to 11 provinces for the suspension of the coal projects to prevent the likelihood of a power glut amid concerns over mild demand for electricity this year.
Shaanxi Coal Industry Co. Ltd. expects to swing to a net profit of between 2.5 billion Chinese yuan and 3.0 billion yuan in 2016, from a net loss of 2.99 billion yuan, or 30 fen per share, recorded a year ago, according to earnings guidance released Jan. 17. The company attributed the turnaround to rising prices of coal due to the nationwide capacity-cut program, the closure of loss-making coal projects in the central China region and the adoption of new production technologies.
India: India is planning to spend 10 trillion Indian rupees to expand the country's crude steel production capacity to 300 million tonnes by fiscal 2030/2031, according to the Steel Ministry's draft National Steel Policy 2017. About 70% of coking coal is imported, and the Ministry of Coal will look to increase the availability of coking coal through overseas asset acquisitions to support the anticipated demand growth in the steel sector.
Vietnam: While other nations are moving away from coal, Vietnam is bolstering the fossil fuel's participation in its energy mix, Nikkei Asian Review reported Jan. 20. The move has attracted both Japanese and Chinese companies. Mitsubishi Corp., for instance, unveiled plans to build a 1,200-MW coal-fired power plant, the Vung Ang No. 2 project, in central Vietnam's Ha Tinh Province. It is slated to commence operation in 2021, with estimated related investments reaching $2.2 billion, said the report.
Colombia: The Colombian government is in talks with stakeholders to resolve all issues blocking the expansion of the Anglo American Plc-operated Cerrejon coal project near the country's Caribbean coast, after a court recently endorsed a decision to halt works to divert a river near the mine, Bloomberg News reported Jan. 19. The planned expansion will allow the mine to boost output to over 90 million tonnes of coal in 2017, Colombia's mines and energy minister, German Arce, told the newswire in an interview.
Tanzania: Kibo Mining Plc on Jan. 23 said an integrated bankable feasibility study for its Mbeya coal-to-power project in Tanzania reduced total CapEx by 21% from the March 2015 integrated pre-feasibility study. The integrated project will generate about US$7.5 billion to US$8.5 billion in indicative total revenue over an estimated 25-year project life.
As of Jan. 20, US$1 was equivalent to 6.88 Chinese yuan renminbi.
As of Jan. 20, US$1 was equivalent to 68.06 Indian rupees.
This feature was updated as of 10:05 a.m. ET on Jan. 23. Some external links may require a subscription.