August 4, 2016
Issue 145  |  View Past Issues
CoalWire

Editor's Note

In what may become a landmark case the Commission on Human Rights of the Philippines has asked a raft of major coal and other fossil-fuel companies to respond  to a complaint that their greenhouse gas emissions have breached people’s rights to “life, food, water, sanitation, adequate housing, and to self-determination.”

Turkey, which is in the midst of a post-coup crackdown, has surprised many by announcing a big levy on thermal coal imports. Meanwhile, Vale’s ambitious plan for a major export mine in Mozambique continues to sour with more losses and repeated attacks on coal trains.

CoalWire will be taking a short break and returning on August 11.

Bob Burton

Features

Philippines set to investigate 60 fossil-fuel companies in landmark human rights case

The Commission on Human Rights of the Philippines has requested 47 major fossil fuel companies – including BHP Billiton, RWE, Sasol, Peabody Energy and UK Coal – respond to a complaint their greenhouse gas emissions have violated the rights of millions of Filipino citizens, writes John Vidal in the Guardian.

More doubts about Powder River Basin companies as Texas shifts away from coal

With the closure of more coal plants in Texas, Powder River Basin coal producers are losing customers, raising further doubts about the ability of companies emerging from bankruptcy to meet their obligations, writes Tom Sanzillo from the Institute for Energy Economics & Financial Analysis.

A ray of light for communities in Serbia’s coal heartland

A recent legal win may pave the way for the compensation and relocation of residents of Vreoci in Serbia, a village of 3000 people adjoining one of Europe’s largest lignite mines, writes Ioana Ciuta from CEE Bankwatch Network in New Internationalist.

Top News

Indonesia to issue moratorium on new coal leases: The Indonesian Ministry of Energy and Mineral Resources is expected to shortly announce a moratorium on new coal-mining concessions. The moratorium proposal has been welcomed by civil society groups but provoked mixed reactions in the coal industry. The Director General for Coal and Minerals at the Energy Ministry, Bambang Gatot, said there were 10,388 coal mining permit holders in Indonesia but over one-third lacked a ‘clean and clear certificate’ certifying they had paid royalties, taxes and complied with environmental requirements. According to major coal producer Adaro Energy, Indonesian coal production is expected to fall by 11 per cent this year to 419 million tonnes. (Indonesia Investments, Platts)

Emails reveal North Carolina sought misleading ‘all clear’ on polluted water: A Freedom of Information request has revealed North Carolina State Toxicologist Ken Rudo refused to sign a letter telling residents affected by coal-ash contaminated wells that their water was safe for drinking and cooking. In an email Rudo warned this was “absolutely scientifically untrue” due to the level of chromium in the water. Duke Energy has sought a court order to suppress part of Rudo’s deposition in a case over pollution from Duke Energy’s closed Buck plant. (Winston-Salem Journal, Shelby Star)

US utility unveils plan to leave coal ash in unlined pits: The Tennessee Valley Authority (TVA), a federal government-owned utility, has unveiled plans to leave millions of tonnes of coal ash in unlined dams at 10 sites in Tennessee and Alabama. The TVA states capping the coal-ash dams and leaving them in place is the fastest, cheapest and safest option. However, environmental groups argue the best way to reduce the groundwater contamination risk to the three million people in the affected catchments is to relocate the ash to lined landfills. (Climate Progress, Southern Environmental Law Center)

Security concerns delay bidding for Bangladesh plant: The Bangladeshi Government has suspended the bidding process for the 1200 megawatt (MW) Matarbari plant pending increased security measures for the competing Japanese companies. Seven Japanese were among the 20 killed in the July 1 terrorist attack on a restaurant in Dhaka. The Japan International Cooperation Agency is proposing to fund 80 per cent of the US$6.7 billion cost of the plant and associated infrastructure. Toshiba and Mitsubishi Hitachi Power Systems are bidding on the project. (Japan Times)

Bangladeshi police attack march against Rampal plant: Police fired tear gas and attacked marchers opposing the proposed 1320 MW Rampal plant proposed near the Sundarbans World Heritage Site. It was estimated almost a hundred were injured with 49 seeking medical treatment after police attacked the march as it moved towards the Prime Minister’s Office. The march aimed to present a letter outlining the reasons the National Committee to Protect Oil, Gas, Mineral Resources, Power, and Ports opposed the project. (Daily Star)

“If one of these ports [on the US West Coast] got approved tomorrow, they [coal companies] could have the option of losing $10 a ton selling more coal,”

said Evan Kurtz, analyst at Morgan Stanley.

News

Europe: In 2015 EU lignite consumption fell to almost half the amount burnt in 1990.

India: Investigation reveals arsenic from coal ash pollutes part of Delhi’s groundwater resources.

Iran: Subsidiary of Russian firm Rostec wins contract to build 1400 MW plant in port city of Bandar Abbas.

Russia: Discussion continues with China on agreement for proposed 8000 MW Erkovetskaya plant.

Serbia: Energy Community begins investigation of Serbia over state aid for Kolubara B power plant.

US: Over 240,000 people call for Department of the Interior to abandon federal lands coal leasing.

Companies + Markets

Turkey imposes thermal coal import levy: The Turkish Government has imposed a levy of US$15 per tonne on thermal coal to “reduce the negative effects of imports” on the economy. Some countries, such as members of the European Free Trade Association, are exempted from the levy. The levy will affect the cost of about 33 million tonnes of thermal coal supplied to 10 import-dependent plants. (Platts)

Vale runs up more losses on Mozambique project: In the first six months of 2016 the Brazilian company Vale lost US$212 million on its Moatize mining operations. Vale produced 1.4 million tonnes of metallurgical coal and 740,000 tonnes of thermal coal from the mine. Vale has been forced to suspend using the Sena railway, which runs to Beira port, due to an attack in July in which a train driver was shot. In June the railway was closed for two weeks due to an earlier attack. (AllAfrica, Macauhub)

Alberta moves to audit mines rehab costs: The Alberta Energy Regulator is moving to audit the nine coal mines in the province which supply power stations to ensure the operator’s “security deposit is sufficient for the liability cost” of mine closure and rehabilitation. Alberta aims to phase out coal plants by 2030. A 2015 report by Alberta's auditor general found that only three of the 19 coal mines in the province – which include metallurgical coal mines – had been subject to a detailed audit of their rehabilitation security deposit. (CBCnews)

Anglo American writes down Australian met coal mines: Anglo American has written down the value of its Moranbah North and Grosvenor metallurgical coal mines by $US1.25 billion as it expects metallurgical coal prices to remain at about US$100 a tonne for between three and five years. Anglo American also disclosed production at the Cerrejon thermal coal mine in Colombia – in which it has a one-third stake – fell by 21 per cent due to heavy rainfall in May and June and “ongoing planned production cuts to take out the highest cost capacity in response to market conditions.” (Australian Financial Review ($), Anglo American)

Pakistan hedges on Japan’s coal financing bid: Pakistan has signalled it may reject an offer from Japan to finance the US$1.7 billion cost of a new Lakhra 650 MW supercritical coal plant due to its higher cost compared to other projects, and coal railway infrastructure constraints. In a separate development the Pakistani Government imposed a ban on new coal plants based on imported coal, preferring either the establishment of hydro or domestic coal projects. (Express Tribune, The News)

Coal outages in Philippines triggers investigation: The withdrawal of almost 3000 MW of generating capacity, including four coal plants with 1632 MW capacity, led to major power load shedding in the major grid on the island of Luzon. The Department of Energy Secretary Alfonso G. Cusi has requested the Energy Regulatory Commission investigate whether the sudden withdrawal of capacity was “caused by anticompetitive behaviour by the industry players.” (Philippine Daily Inquirer, Manila Standard)

Resources

Greasing the Wheels, Australian Conservation Foundation and the Australia Institute, June 2016. (Pdf)

This 57-page report examines the distortions of government decision-making which occurred in the cases of six mining companies – including the coal companies Adani Mining and New Hope Corporation – which made major donations to political parties in Queensland.

Texas’ Outsize Role in the Decline of the Powder River Basin Coal Industry, Institute for Energy Economics & Financial Analysis, August 2016. (Pdf)

This 13-page report examines the implications for major Powder River Basin coal companies –including Peabody Energy, Cloud Peak, Arch Coal and Alpha Natural Resources – caused by the dramatic decline in coal consumption in Texas, the leading coal-burning state.

China-SEE energy projects update, CEE BankWatch Network, July 2016. (Pdf)

This 5-page briefing note provides an overview of the potential role of Chinese banks in financing proposed lignite plants and other energy projects in Bosnia and Herzegovina, Serbia, Montenegro and Romania.