B06 Coal Mining

BHP’s growth prospects still linked to oil

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 22 : 6-Feb-17

BHP Billiton’s announcement in 2016 that it would seek to increase annual coking coal production in Queensland by four million tonnes has proven to be an astute move, given the rebound in the price of coal. The Peak Downs mine achieved record output in the December quarter. BHP also advised that maintenance work on railway lines serving its Pilbara iron ore operations will be completed nine months ahead of schedule. Meanwhile, BHP is ramping up investment in its petroleum division in order to arrest a decline in production.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, UBS HOLDINGS PTY LTD, MITSUBISHI CORPORATION

Premium paid widens for top quality coal

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Original article by Peter Ker
The Australian Financial Review – Page: 18 : 16-Dec-16

The contract price for semi-soft coking has been settled at $US171 per tonne for the March 2017 quarter, which is 32 per cent higher than the current contract price. Meanwhile, buyers will pay $US180 per tonne for pulverised coal injection (PCI), which is an increase of 35 per cent. Despite the large rise in contract prices, both commodities are still fetching a significant discount compared with the price of hard coking coal.

CORPORATES
GLENCORE PLC, PEABODY ENERGY CORPORATION, WHITEHAVEN COAL LIMITED – ASX WHC, YANCOAL AUSTRALIA LIMITED – ASX YAL, STANMORE COAL LIMITED – ASX SMR, RIO TINTO LIMITED – ASX RIO, ANGLO AMERICAN PLC, SHAW AND PARTNERS LIMITED, IHS MARKIT

Price jump agreed for coking coal

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 16 : 14-Dec-16

The contract price for premium hard coking coal has been settled at $US285 per tonne for the March 2017 quarter, compared with a contract price of $US200 per tonne in the final quarter of 2016. There has been a sharp rise in the price of coking coal in 2016, and the contract price was below $US81 per tonne in the March quarter. Meanwhile, Marian Hookham of IHS Markit says producers of pulverised coal injection (PCI) coal hope to secure a contract price of about $US190 per tonne for the first quarter of 2017.

CORPORATES
IHS MARKIT, GLENCORE PLC, NIPPON STEEL AND SUMITOMO METAL CORPORATION, BHP BILLITON LIMITED – ASX BHP, MITSUBISHI CORPORATION, ANGLO AMERICAN PLC, TECK CORPORATION

BHP considers selling Bowen Basin coal asset

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Original article by Peter Ker
The Australian Financial Review – Page: 15 : 5-Dec-16

A BHP Billiton spokesperson has downplayed speculation that the resources giant could seek a buyer for the Gregory Crinum complex in Queensland, which it owns in partnership with Mitsubishi. BHP had shelved plans to sell Gregory Crinum in 2013, due to a downturn in the coking coal price. However, talk of a possible sale has been prompted by the recent rally in the price of coking coal, which is fetching more than $US300 per tonne. BHP mothballed the Crinum longwall mine in 2015.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, MITSUBISHI CORPORATION, ANGLO AMERICAN PLC, BECHTEL PTY LTD, RIO TINTO LIMITED – ASX RIO, GLENCORE PLC, BATCHFIRE RESOURCES, AUSTRALIAN PACIFIC COAL LIMITED – ASX AQC, WESFARMERS LIMITED – ASX WES, PEABODY ENERGY CORPORATION, SOUTH32 LIMITED – ASX S32, RBC CAPITAL MARKETS

Rio facing US probe over Mozambique

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Original article by Matthew Stevens
The Australian Financial Review – Page: 13 & 16 : 29-Nov-16

It has been revealed that Rio Tinto’s 2011 acquisition of Riversdale Mining has been the subject of a confidential investigation by the US Securities & Exchange Commission. The probe into the $US4.16bn takeover of the Mozambique-focused coal producer predates revelations over the scandal surrounding the Simandou iron ore project in Guinea. A subsequent $US3.269bn write-down in the value of the Mozambique assets in Rio’s 2012 financial accounts led to the departure of several top executives, including CEO Tom Albanese.

CORPORATES
RIO TINTO LIMITED – ASX RIO, RIVERSDALE MINING LIMITED, UNITED STATES. SECURITIES AND EXCHANGE COMMISSION, GREAT BRITAIN. SERIOUS FRAUD OFFICE, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, BHP BILLITON LIMITED – ASX BHP, KIRKLAND AND ELLIS LLP, INTERNATIONAL COAL VENTURES LIMITED

Tinkler says family to quit $40m coal stake

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Original article by Paul Garvey
The Australian – Page: 6 : 18-Nov-16

Nathan Tinkler and members of his family paid about $A6.6m for a 37 per cent stake in Australian Pacific Coal in 2015. Tinkler has advised that his family intends to divest its entire holding, which is now worth some $A40m, due to APC’s long delay in finalising a deal to acquire the Dartbrook coal project in the Hunter Valley. Tinkler has also rejected speculation that APC could be a potential buyer of Anglo American’s Drayton South project if it gains environmental approval.

CORPORATES
AUSTRALIAN PACIFIC COAL LIMITED – ASX AQC, ANGLO AMERICAN PLC, BENTLEY RESOURCES PTE LTD, TREPANG SERVICES, NEW SOUTH WALES. PLANNING ASSESSMENT COMMISSION

Wesfarmers explores $2b coal mine sales

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Original article by Peter Ker
The Australian Financial Review – Page: 19 : 17-Nov-16

Australian-listed conglomerate Wesfarmers has advised that it is considering a range of options for its coal assets, including divestment. It has called for expressions of interest from potential buyers of the Curragh mine, as well as its 40 per cent stake in the Bengalla mine. However, Wesfarmers has stressed that a deal may not eventuate. The sale price of Curragh is likely to be boosted after the recent approval of an expansion plan, which will extend its mine life until around 2038.

CORPORATES
WESFARMERS LIMITED – ASX WES, NEW HOPE CORPORATION LIMITED – ASX NHC, BHP BILLITON LIMITED – ASX BHP, APOLLO GLOBAL MANAGEMENT LLC, ANGLO AMERICAN PLC, PEMBROKE RESOURCES PTY LTD, DENHAM CAPITAL MANAGEMENT LP, JELLINBAH GROUP, MACH ENERGY, SALIM GROUP, RIO TINTO LIMITED – ASX RIO, MITSUI AND COMPANY LIMITED, TAIWAN POWER COMPANY, UBS HOLDINGS PTY LTD, BLOOMBERG LP

Coal contract prices expected to stay high

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Original article by Peter Ker
The Australian Financial Review – Page: 15 & 20 : 9-Nov-16

The spot price of premium hard coking coal has risen to more than $US289 per tonne in early November 2016. Coal producers and buyers recently settled on a contract price of $US200/tonne for the December quarter. Whitehaven Coal CEO Paul Flynn says the spike in the spot price should ensure that contract prices rise again in the March 2017 quarter. He also anticipates a rise in the price of thermal and semi-soft coking coal.

CORPORATES
WHITEHAVEN COAL LIMITED – ASX WHC, MACQUARIE GROUP LIMITED – ASX MQG, GLENCORE PLC

Tinkler enjoys $35m windfall as coal surges

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Original article by Peter Ker
The Australian Financial Review – Page: 15 : 19-Oct-16

Businessman Nathan Tinkler and associated entities are believed to control some 37.25 per cent of the listed Australian Pacific Coal’s shares. The stock has benefited from the rally in the thermal coal price in 2016, which has seen the value of Tinkler’s July 2015 investment of $A6.6m in APC rise to more than $A41m. Tinkler stepped down as MD of the company earlier in 2016, after he was declared bankrupt.

CORPORATES
AUSTRALIAN PACIFIC COAL LIMITED – ASX AQC, ANGLO AMERICAN PLC, WHITEHAVEN COAL LIMITED – ASX WHC, BENTLEY RESOURCES PTE LTD, VG SUPERANNUATION FUND, L&Z TINKLER FAMILY SUPERANNUATION FUND, RJ TINKLER FAMILY TRUST, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Whitehaven ramps up coking coal output

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 25 : 18-Oct-16

The rise in the price of coking coal has prompted Whitehaven Coal to lift production in the December 2016 quarter and scale back output of thermal coal. The proportion of semi-soft coking coal produced at its Maules Creek mine will rise to 30 per cent during the period. The price of this coal has risen more strongly than thermal coal in 2016, although growth in the price of premium hard coking coal has significantly outpaced both. Peter O’Connor of Shaw & Partners says other miners could move to lift production, which could in turn put pressure on the coking coal price.

CORPORATES
WHITEHAVEN COAL LIMITED – ASX WHC, SHAW AND PARTNERS LIMITED, PRUDENTIAL INVESTMENTS PTY LTD