CoalWire 125, March 17, 2016

March 17, 2016

editor’s note

Sustained community opposition in tandem with the falling global coal price has added coal mines in the US and New Zealand to an ever-growing list of abandoned projects. From Indonesia to Poland to the US, the coal industry is scrambling to lock in public subsidies to breathe life into ailing coal plans. Other projects as far afield as Bangladesh and Ghana are being propped up by Indian and Chinese government-backed funders, in part for geo-political positioning and in part to support the export ambitions of coal plant equipment suppliers. Big, old industries rarely move on voluntarily.

Bob Burton
CoalWire Editor

features

‘Long March’ in Bangladesh urges protection of Sundarbans forests from pollution

Over a thousand Bangladeshis and Indians joined together for a four-day march to demand their governments cancel plans for coal-fired power plants that would threaten the Sundarbans, writes Jessica Lawrence in Earthjustice.

Tweet: ‘Long March’ in #Bangladesh urges protection of Sundarbans forests from #pollution bit.ly/1UxHZ8M #coal

The human cost of India’s push to produce more coal

The growth of coal mining in India comes at mounting social and environmental costs, writes Fred Pearce in Yale Environment 360.

Tweet: The human cost of #India’s push to produce more #coal bit.ly/1Paanam pic.twitter.com/rzk9juwvSF @YaleE360

campaigns

Arch Coal abandons Otter Creek coal mine

After a dogged six-year campaign by tribal leaders, ranchers and environmentalists Arch Coal has abandoned its proposed Otter Creek mine in Montana. In March 2010 the Montana Land Board leased the Otter Creek deposit to Arch Coal, which – together with adjoining leases held by the company – contain 1.4 billion tonnes of coal. While the company submitted applications for a mine permit in 2012 and 2014, these were subject to legal challenges and were found by the Montana Department of Environmental Quality to be lacking important information. The collapse of the project will also have knock-on effects on the proposed Tongue River Railroad and the Millennium Bulk Terminals-Longview coal export terminal in Washington, both of which Arch Coal is a part-owner (Inside Climate News, Sierra Club)

Tweet: After six-year campaign Arch Coal abandons Otter Creek #coal mine http://bit.ly/1pmyiyi #US

Controversial New Zealand mine mothballed

Environmental groups have called on Bathurst Resources to relinquish its permits for the Escarpment mine on the South Island after the company announced the project will be mothballed in May. The mine, on the ecologically unique Denniston Plateau, was subject to several legal challenges but finally approved in mid-2014. However, the plan for the production of up to 1.5 million tonnes a year of metallurgical coal in 2016 primarily for export to the Asian steel industry foundered with the fall in the coal price. While Bathurst Resources has said it hopes to restart the project in the future, Forest & Bird has called for the area to be rehabilitated and the company to surrender its permits. (Otago Daily Times, Coal Action Network Aotearoa)

Tweet: Bathurst Resources mothballs controversial Escarpment #coal mine – call for rehabilitation bit.ly/1RlcE3Z

top news

Indian Government downplays increasing air pollution: India’s Environment Minister Prakash Javadekar has claimed that a Greenpeace report showing air pollution in some Indian cities is worse than the most heavily polluted cities in China was based “on extrapolated and constructed data without field validation.” In response, Greenpeace India argues the use of NASA satellite data was due to the lack of comprehensive publicly available pollution information. It also pointed out that the government’s own data indicates pollution in northern Indian cities is well in excess of air quality standards. (Press Trust of India, Greenpeace India)


German lignite lobby launches defensive campaign: The German lignite lobby group Debriv – which includes RWE and Vattenfall as members – has stepped up pressure on Chancellor Angela Merkel’s government to keep lignite plants operating until mid-century. With the remaining nuclear plants scheduled to close by 2022, the closure of coal plants will be required to meet the government’s target of an 80-95 per cent reduction in greenhouse gas emissions by 2050, from a 1990 baseline. At present lignite generates about one-quarter of the country’s power and hard coal a further 18 per cent. (Bloomberg)


Utah votes to spend US$53 million on California port: The Utah legislature has approved a bill to provide US$53 million towards the cost of a port expansion in Oakland, California in the hope that it will facilitate coal exports from mines in the state. Bowie Resource Partners, which produces half the coal mined in Utah, donated US$29,000 to key Utah legislators championing the passage of the bill. (Salt Lake Tribune, East Bay Express)

India’s coal glut delays opening sector to private miners: While government-owned Coal India has increased production to over 500 million tonnes in the current financial year, stockpiles at mines and power plants have reached 88 million tonnes, 63 per cent higher than April 2015 levels. The growing coal stockpiles have forced the Indian Government to delay opening the commercial coal sector to private companies, which it had been hoping would lead to as much as an extra 400 million tonnes of coal a year by 2020. (Business Standard, Reuters)


Legal appeal against proposed South African plants: Legal appeals have been filed against the Department of Environmental Affairs’ approval of three proposed coal plants which the South African Ministry of Energy is proposing be built by independent power producers. GroundWork, Earthlife Africa Johannesburg and partner community groups are challenging the plants, which have a combined capacity of 2500 megawatts (MW), on the grounds they will have significant impacts on the health of nearby communities and water resources. (Mining Review)


China’s shift away from coal continues: New data from January and February reveals China’s economic shift away from energy-intensive industry continues while non-coal generation has captured an increasing share of electricity demand. Coal imports fell by 10.2 per cent while domestic coal production fell by 6.4 per cent. Electricity consumption increased by 0.3 per cent compared to the same two-months in 2015 while coal and gas generation fell by 4.3 per cent year-on-year. (Institute for Energy Economics & Financial Analysis)

“Moody’s believes that the current [seaborne] coal market downturn is structural in nature, with weak conditions likely to persist,”
wrote the financial ratings agency Moody’s in a review of the Adani subsidiary which operates the Abbot Point Coal Terminal in Australia.

news

Australia: NSW government passes legislation to allow jailing of anti-mine and coal seam gas protesters.


Botswana: As coal export hopes fade, government oil company promotes coal-to-oil plans.


Europe: European coal lobby hires climate sceptic Patrick Moore for dinner with European officials.

Myanmar: Civil society groups call for scrapping of 1280 MW plant proposed by Thai consortium.


Ukraine: Government says Turkey interested in mines slated for privatisation.


US: In 2014 Arch Coal donated  US$10,000 to E & E Legal, a group which sued climate scientists.

companies + markets

Indonesia canvasses subsidies for coal plants: The Indonesian Government is considering a coal industry request for domestic power producers to pay higher prices. The Minister for Energy and Mineral Resources, Sudirman Said, said the Indonesian Coal Mining Association (APBI) had proposed an “insurance premium” of one to three per cent of the basic power tariff be paid to coal producers to encourage supply for proposed new coal plants. Greenpeace Indonesia estimated the subsidy would amount to US$230 to $680 million and urged the government to reject the coal industry’s demand. (Jakarta Post, Tempo)


Polish utilities may bailout coal mines: Three Polish power and gas utilities – PGE, PGNiG and Energa – have offered to invest US$388 million in Polska Grupa Gornicza (PGG), the special purpose company established by the government to hold the loss-making mining assets of the state-owned Kompania Weglowa. However the utilities’ offer is conditional on being given assurances that PGG will be profitable; further investments won’t be sought in the next decade; and their investments will not be in breach of European Union rules banning subsidies for ongoing coal mines. (Bloomberg)


Adani’s Abbot Point subsidiary downgraded: Moody’s has downgraded the credit rating of Adani Abbot Point Terminal (AAPT) “due to the weakened position” of the coal companies exporting through the terminal. Moody’s notes that companies contracted to export through the 50 million tonnes per annum coal terminal at Abbot Point in Queensland are “the sole source” of cash for the company. Moody’s analyst Mary Anne Low stated the “ongoing severe pressure facing the coal sector translates into an increased likelihood of AAPT’s counterparty contracts either not being renewed or subject to early termination.” (Moody’s, Livemint)

China funds coal plant in Ghana: In the latest international coal project to attract Chinese funding, the China-Africa Development Fund has announced it will provide US$1.5 billion to finance two 350 MW units proposed by the Volta River Authority. The Shenzhen Energy Group is slated to build the project. The Ghana Youth Environmental Movement has expressed alarm at the lack of a public environmental review of the project, and the health and environmental impacts from pollution from the plant. (B&FTOnline, CoalSwarm)


Vattenfall’s plan to sell mines falls flat: The plan by the Swedish utility Vattenfall to sell 8100 MW of coal plants and associated lignite mines in eastern Germany has attracted little interest. Low wholesale electricity prices and high rehabilitation liabilities are believed to have deterred bidders. The deadline for binding offers was March 16. While Greenpeace submitted a bid requesting payment to shut the mines and plants, the mining union IG BCE and two state governments are considering a plan to keep the plants operating in the hope power prices will rise when further nuclear power plants close early next decade. (Handelsblatt, Reuters)


Scrutiny grows over sale of Glencore’s Optimum coal mine: As scrutiny intensifies over the purchase of Glencore’s loss-making Optimum mine by a consortium involving President Jacob Zuma’s son, questions have been raised as to how Tegeta Exploration & Resources will finance the US$135 million purchase price. It has been suggested that the cash rehabilitation fund established by Glencore but held by the Department of Mineral Resources may be swapped for a bank guarantee – if permission is given – to cover the purchase cost. (BD Live, Financial Times)

resources

The Good Life (La Buena Vida), video, 2015.

This 2-minute trailer shows the conflict between the community of Tamaquito in Colombia and the Cerrejon Coal Company (CCC) over the plan to expand the Cerrejon mine. (CCC is a joint venture between Glencore, BHP Billiton and Anglo American.)

Tweet: The Good Life film promo on Tamaquito community vs #Cerrejon #coal company dceff.org/film/good-life… #BHPBilliton #Glencore #AngloAmerican

 

 

The unpaid health bill: How coal power plants in Western Balkans make us sick, Health and Environment Alliance, March 12, 2016.

This report provides the first ever assessment of the health costs of coal power plants in the Western Balkans.