We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Friday, 07 August 20
PEABODY'S $1.42 BILLION WRITE-DOWN CONCEDES COAL MINES HAVE LITTLE VALUE AND DIM FUTURE - IEEFA
 Trouble at biggest mine in Powder River Basin speaks volumes about state of industry
Peabody Energy, the world’s largest privately owned coal company and the biggest U.S. coal producer, has finally acknowledged a long-apparent reality: Thermal coal mines in the U.S. have little value anymore and not much of a future.
The company said as much earlier this month when it slashed the book value of the largest coal mine in the country—the North Antelope Rochelle mine in Wyoming’s Powder River Basin—by $1.42 billion, or 22% of Peabody’s total asset value.
When Peabody emerged from bankruptcy three years ago after having discarded $5 billion of its unsustainable $10.1 billion debt load, CEO Glenn Kellow said the company was “well positioned to create substantial value for shareholders and other stakeholders over time,” and that Peabody had “taken significant steps to create a capital structure to succeed through all cycles.”
On its first full day of trading after that—on April 4, 2017—Peabody’s stock price closed at $27.25. After the company’s most recent earnings release on Aug. 5, the stock closed at $2.90, a drop of almost 90% after the company’s supposed comeback.
Peabody’s North Antelope Rochelle write-down is simply a reflection of the new reality in U.S. coal-mining that has been evident almost since the moment the company came out of bankruptcy. The industry continues to be battered by rapid structural decline driven by low gas prices, the low and falling cost of building wind and solar power generation, and sweeping initiatives by utilities and corporations to cut emissions. Peabody conceded the obstacles, almost word-for-word, in its earnings release.
DEMAND FOR COAL IS IN FREE FALL. In 2018, U.S. utilities consumed 637 million tons of thermal coal, and an additional 54 million tons were exported. This year, utilities are likely to reduce their consumption to 377 million tons, a 41% decrease over two years, while exports of thermal coal may fall to 25 million tons, a 50% drop over the same period, according to the latest short-term forecast from the Energy Information Administration.
Coal company bankruptcies more recent than Peabody’s, including Westmoreland Coal, Cloud Peak Energy and Blackjewel, have all drawn little investor interest, with mine values approaching zero, and in some cases, essentially negative asset valuations because of the significant payouts needed to coax financially weak buyers to take on huge cleanup liabilities.
Most of this action has centered on the Powder River Basin (PRB), the single biggest repository of U.S. coal, and one that has been beset by intractable problems for years.
Peabody, with some of the best economies of scale in the PRB and global expertise in coal mining, should have been well-positioned to outlast financially weaker and smaller rivals. But instead, the industry—Peabody included—embraced a perverse business model. The companies have been enabled by a lenient bankruptcy process and feeble oversight by federal and state regulators that has allowed companies to continue mining coal and undercutting each other on price while shirking their cleanup obligations, falling far behind on royalty and tax payments, and investing little capital in mine upkeep—all while spiraling toward bankruptcy anew.
ECONOMICALLY SPEAKING, THIS CAN’T CONTINUE. The U.S. thermal coal market has a vast oversupply of product chasing fewer and fewer customers. An orderly retreat would make sense, but instead, chaos reigns.
The growing probability is that the collapse of U.S. coal mining will be disorderly, resulting in bankruptcies that end in liquidation, abrupt mine closures, the abandonment of cleanup obligations, and possibly the financial collapse of some bonding companies that are supposed to be the backstop for those liabilities.
State and county finances are already at great peril in the Powder River Basin, as falling asset values and production reduce tax and royalty payments, adding to the pain of lost paychecks and damage to local businesses.
What seemed to be a slow-moving catastrophe not too long ago has gained momentum, and Peabody’s huge write-down is a stark warning that coal mining’s financial distress will continue.
Seth Feaster is an IEEFA data analyst.
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Thursday, 06 August 20
SUPRAMAX MARKET CONTINUED SIDEWAYS TREND, AND LITTLE INSPIRING NEWS APPEAR - FEARNLEYS
Capesize
There is presently a small correction in rates, but overall levels are up from previous week mainly due to increased demand in the Eas ...
Thursday, 06 August 20
KOREA SOUTH-EAST POWER INVITING BIDS FOR MIN 3,600-MAX 3,800 NCV COAL
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) inviting bids for 80,000 Tons (MT) Min 3,600~Max 3,800 kcal/kg NCV coal f ...
Wednesday, 05 August 20
NO NEW MINING LICENSES - A REMINDER TO GOVERNORS IN INDONESIA - SSEK
Indonesia’s acting Director General of Mining and Coal (“DGMC”) has issued a letter to the country’s provincial Governors t ...
Wednesday, 05 August 20
AUGUST 2020 HBA HITTING ITS LOWEST LEVELS IN HISTORY
COALspot.com: The Indonesia Coal Price Reference for the month of August plunged 30.73% YoY, hitting its lowest levels in history and highlighting ...
Wednesday, 05 August 20
SLUMP IN OIL REVENUE CHALLENGES MIDDLE EAST OIL EXPORTERS - INTERMODAL
The Covid-19 pandemic has had far-reaching consequences on the global capital markets. Despite the US government’s efforts for a quick and de ...
|
|
|
Showing 841 to 845 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Electricity Generating Authority of Thailand
- Energy Development Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mjunction Services Limited - India
- Goldman Sachs - Singapore
- Port Waratah Coal Services - Australia
- South Luzon Thermal Energy Corporation
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
- Marubeni Corporation - India
- Electricity Authority, New Zealand
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Karaikal Port Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Leighton Contractors Pty Ltd - Australia
- LBH Netherlands Bv - Netherlands
- Chettinad Cement Corporation Ltd - India
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
- Mercuria Energy - Indonesia
- Attock Cement Pakistan Limited
- Directorate General of MIneral and Coal - Indonesia
- Essar Steel Hazira Ltd - India
- Independent Power Producers Association of India
- Ministry of Mines - Canada
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Singapore Mercantile Exchange
- London Commodity Brokers - England
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Minerals Council of Australia
- McConnell Dowell - Australia
- Africa Commodities Group - South Africa
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Kumho Petrochemical, South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bangladesh Power Developement Board
- Bulk Trading Sa - Switzerland
- San Jose City I Power Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Orica Mining Services - Indonesia
- Bhatia International Limited - India
- Eastern Energy - Thailand
- Mercator Lines Limited - India
- Kobexindo Tractors - Indoneisa
- Aditya Birla Group - India
- Deloitte Consulting - India
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- Baramulti Group, Indonesia
- Energy Link Ltd, New Zealand
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Makarim & Taira - Indonesia
- Simpson Spence & Young - Indonesia
- Parliament of New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Maheswari Brothers Coal Limited - India
- Indika Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Edison Trading Spa - Italy
- Central Electricity Authority - India
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Medco Energi Mining Internasional
- The Treasury - Australian Government
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Planning Commission, India
- India Bulls Power Limited - India
- Wood Mackenzie - Singapore
- PTC India Limited - India
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Global Coal Blending Company Limited - Australia
- IEA Clean Coal Centre - UK
- MS Steel International - UAE
- Jindal Steel & Power Ltd - India
- Bayan Resources Tbk. - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhushan Steel Limited - India
- Coal and Oil Company - UAE
- Australian Coal Association
- Kepco SPC Power Corporation, Philippines
- VISA Power Limited - India
- The State Trading Corporation of India Ltd
- Jorong Barutama Greston.PT - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Tamil Nadu electricity Board
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Bukit Makmur.PT - Indonesia
- Posco Energy - South Korea
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- Vizag Seaport Private Limited - India
- Ambuja Cements Ltd - India
- Petron Corporation, Philippines
- Malabar Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Cement Manufacturers Association - India
- Interocean Group of Companies - India
- Barasentosa Lestari - Indonesia
- Chamber of Mines of South Africa
- Altura Mining Limited, Indonesia
- Carbofer General Trading SA - India
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Eastern Coal Council - USA
- Latin American Coal - Colombia
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Dalmia Cement Bharat India
- Global Green Power PLC Corporation, Philippines
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- Sinarmas Energy and Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Transport, Egypt
- SN Aboitiz Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Grasim Industreis Ltd - India
- Wilmar Investment Holdings
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- Commonwealth Bank - Australia
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aboitiz Power Corporation - Philippines
- Thai Mozambique Logistica
- Krishnapatnam Port Company Ltd. - India
- Gujarat Mineral Development Corp Ltd - India
- Romanian Commodities Exchange
- Gujarat Sidhee Cement - India
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- SMC Global Power, Philippines
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- Bharathi Cement Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Timah Investasi Mineral - Indoneisa
- Bhoruka Overseas - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Siam City Cement - Thailand
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- Trasteel International SA, Italy
- Billiton Holdings Pty Ltd - Australia
|
| |
| |
|
