CoalWire 123, March 3, 2016.

March 3, 2016

editor’s note

The Indian Government’s doubling of the tax on coal – the opposite of the coal lobby’s demand – is another hopeful sign the country is emulating China’s switch to renewables. New Chinese data reveals coal use continues to fall, renewables are booming and greenhouse gas emissions dropping.

The coal lobby has long pinned its hopes on China and India’s demand growing and underpinning the coal trade for decades to come. The opposite is coming to pass, especially for the seaborne coal trade. This week Anglo American has announced the end of its plans for new coal operations in Botswana, Vale has lost another US$500 million on its ambitious Mozambique plans, and the World Bank has all but ruled out funding coal plants in Myanmar.

All of which explains why coal industry lobbyists are so glum these days.

Bob Burton
CoalWire Editor

features

Arch Coal’s hidden handouts to opponents of climate action

The voluminous list of Arch Coal’s creditors reveals the company has been a secret donor to the libertarian Ludwig Von Mises Institute, the American Legislative Exchange Commission and the Energy & Environment Legal Institute, all of which are active in opposing action on climate change, writes Bob Burton in EndCoal.

Tweet: Arch #Coal’s hidden handouts to opponents of #climate action bit.ly/1Qsvs58

campaigns

Canadian coal project collapses as backers flee and directors resign

Broad community opposition by the seafood industry, residents and municipal governments has resulted in the collapse of the proposed Raven Coal Project on Vancouver Island in Canada. The mine, which had been proposed by the Vancouver-headquartered Compliance Energy Corporation (CEC), was rejected by the British Columbia Environmental Assessment Office (EAO) in 2013. In March 2015 public uproar forced CEC to withdraw from assessment of the resubmitted project. In late-February CEC’s entire board of directors resigned after its joint venture partners Itochu Corporation from Japan and LG International from Korea withdrew from the project. CoalWatch has called on the EAO to drop the project from further considerations. (Compliance Energy Corporation, CoalWatch Comox Valley Society)

Tweet: Canadian #coal project collapses as backers flee and directors resign

top news

China reveals 2015 coal fall: Data released by the Chinese Government’s National Bureau of Statistics indicates greenhouse gas emissions from fossil fuels fell by 2.3 per cent in 2015. Behind the fall is an estimated 3.7 per cent fall in coal consumption. Despite the shift to renewables, Greenpeace has revealed that 210 new coal plants were approved in 2015, in large part because of the delegation of decision-making to provincial authorities. (EnergyDesk, EnergyDesk)


China limits North Korean coal imports:China has reportedly banned the importation of North Korean coal at a major border post ahead of a vote at the United Nations Security Council on a resolution imposing tighter sanctions on the country over its weapons program and missile tests.  Coal exports to China are North Korea’s largest source of export income. While China and the US have agreed on the text, its enforcement is open to interpretation and excludes the export of Russian coal via the port of Rajin to South Korea. (Nikkei Asian Review, Reuters)

World Bank eschews coal in Myanmar:The World Bank’s country manager for Myanmar, Abdoulaye Seck, has flagged the bank does not intend to fund any coal plants in the country. Myo Myint from the World Bank noted domestic coal was low quality which would mean any coal plants would have to be based on imported coal even though other domestic energy sources are available. (Eleven Myanmar)


Indonesian court dismisses challenge to Batang plant: The Supreme Court has rejected a challenge by residents against lower court approval of the siting of the 2000 megawatt (MW) Batang plant in central Java. Some residents and farmers have refused to sell their land for the project. Two Japanese companies – J-Power and Itochu – own two-thirds of the joint venture company for the project, which is seeking funding from the Japan Bank for International Cooperation. The community is considering other legal options. (Jakarta Post)

news

Canada: Port Metro Vancouver exported no coal to China in 2015; shipments to Japan & Korea fell.


Russia: Blasts kill 36 miners and rescuers at Severnaya underground metallurgical coal mine.

UK: Major energy industry lobby group backs coal power phase-out.


US: Justice Energy, owned by a candidate for West Virginia Governor, fined US$1.23 million for contempt of court.

companies + markets

India doubles coal tax, boosting solar:The Indian Government has doubled the tax it applies to both domestic and imported coal, a price hike of about US$3 per tonne. The coal tax has now been increased three times since it was first introduced in July 2010. It is estimated the revised tax will increase coal power costs by about six to seven per cent, further accelerating the deployment of renewable energy. In recent auctions unsubsidised solar power has emerged as cheaper than new plants based on imported coal. (Economic Times, IEEFA)


Peabody Energy teeters on brink of bankruptcy: Major lenders to Peabody Energy are pushing the company to declare bankruptcy and restructure its US$6 billion debt. The company has notified the US Securities and Exchange Commission (SEC) it will be late in filing its 2015 annual report due to its inability to complete the US$358 million sale of two mines to Bowie Resources by March 31. The company warned the failure of the sale meant the company’s accountant was reluctant to state the company is a “going concern.” Without the payment from Bowie Resources the company states there is “substantial doubt as to whether the Company can comply with its financial covenants.” (Reuters, Peabody Energy)


Anglo American dumps Botswana plans:Anglo American is terminating its exploration work on two coal leases in the Mmamabula coalfields and closing its office in Botswana. Anglo American gained the two leases in 2013 which it intended to develop for both domestic power generation and the export market. (Mmegionline)

Vale’s losses continue on Mozambique mine: The Brazilian mining company Vale has revealed it lost US$508 million in 2015 on its Moatize mine and the railway connecting it to the port of Nacala. Vale also wrote down the value of its Mozambique coal assets by US$2.4 billion. ACWA Power, which is seeking to build a US$1 billion 300 MW coal plant to power the mine, has stated getting finance for the project is “turning out to be quite a challenge.” (Macauhub,  Zitamar News)


Glencore announces huge loss but eyes larger share of Cerrejon: Despite announcing a $US4.9 billion loss for 2015, Glencore has signalled potential interest in buying up to half of Anglo American’s one-third share of the Cerrejon thermal coal mine in Colombia. Glencore’s CEO, Ivan Glasenberg, has signalled the company’s interest in increasing its stake in the mine at “the right price” – and if the other joint-venture partner, BHP Billiton, bought the other part of Anglo American’s share. Cerrejon is a controversial but low-cost mine with the capacity to export up to 40 million tonnes a year. (Sydney Morning Herald, Glencore [large pdf])

resources

Behemoth, Video.

This 6-minute long trailer features the highlights of Zhao Liang’s 2015 film on the impacts of coal and iron ore mining on the people and environment in the Chinese province of Inner Mongolia.


“Bleak outlook for coal as China befriends renewables”, The Tree, March 1, 2016.

This is a brief backgrounder on China’s transformation away from coal and links to useful materials.