COAL MINES AND MINING – AUSTRALIA

Coal sector failing to overturn China’s import testing

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Original article by Amanda Saunders
The Australian Financial Review – Page: 20 : 9-May-16

Greg Evans of the Minerals Council of Australia says China should either abandon its policy of testing the quality of imported coal or allow shipments to be tested before they depart for China. He adds that the quality control tests contributed to a decline in Australia’s coal exports to China to just 71.2 million tonnes in 2015, compared with 93.4 million tonnes in 2014. The Australian Government has also lobbied China to drop the policy, which was introduced in early 2015.

CORPORATES
MINERALS COUNCIL OF AUSTRALIA, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF FOREIGN AFFAIRS AND TRADE

Warning over Peabody’s local mines

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Original article by Matt Chambers
The Australian – Page: 19 & 22 : 3-May-16

The auditor’s report in the latest financial accounts of Peabody Energy Australia Coal warns of doubts as to whether it can continue as a going concern. Its US-based parent, Peabody Energy Corporation, recently filed for bankruptcy protection with debts of $US6.3bn. The Australian business is not subject to the bankruptcy filing, but its financial accounts note that a $US250m inter-company loan facility may not be sufficient for all of Peabody Energy Australia’s cash outflows.

CORPORATES
PEABODY ENERGY AUSTRALIA COAL PTY LTD, PEABODY ENERGY CORPORATION, ERNST AND YOUNG, EXCEL COAL LIMITED, MACARTHUR COAL LIMITED, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Price struck for thermal coal export a ‘huge coup’

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 27 : 27-Apr-16

Australian thermal coal producers have secured an annual contract price of $US61.60 per tonne from Japanese buyers for the financial year that began on 1 April 2016. While this is 9.1 per cent lower than the $US67.80 for the previous Japanese financial year, Macquarie Wealth Management notes that it is about $US10.80 per tonne higher than the spot price. Australian shipments of thermal coal to Japan totalled 84.7 million tonnes in 2015.

CORPORATES
MACQUARIE WEALTH MANAGEMENT, GLENCORE PLC, TOHOKU ELECTRIC POWER CORPORATION, WHITEHAVEN COAL LIMITED – ASX WHC, IHS GLOBAL INSIGHT INCORPORATED

Japanese buyers demand cheaper Australian coal

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Original article by Peter Ker
The Australian Financial Review – Page: 1 & 11 : 5-Apr-16

The downturn in coal prices and a global oversupply is expected to result in Japan’s power companies securing a lower contract price in current negotiations with Australian thermal coal producers. The annual contract price is usually higher than the spot price, but the utilities are believed to be seeking a discount of at least 10 per cent on the previous contract price of about $US67 per tonne. RBC Capital Markets forecasts that the thermal coal price will rebound to around $US65/tonne in 2018.

CORPORATES
RBC CAPITAL MARKETS, IHS GLOBAL INSIGHT INCORPORATED, RIO TINTO LIMITED – ASX RIO, GLENCORE PLC, TOHOKU ELECTRIC POWER CORPORATION, ADANI ENTERPRISES LIMITED, ROY HILL HOLDINGS PTY LTD, AUSTRALIA. EXPORT FINANCE AND INSURANCE CORPORATION, ANGLO AMERICAN PLC, TAURUS FUNDS MANAGEMENT PTY LTD, STANMORE COAL LIMITED – ASX SMR, VALE SA, SUMITOMO CORPORATION

BHP coalmine on the brink as profits dive

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Original article by Matt Chambers
The Australian – Page: 18 : 29-Feb-16

BHP Billiton’s Mount Arthur mine in New South Wales currently produces about 10 per cent of the thermal coal that is exported from Australia each year. However, BHP CEO Andrew Mackenzie recently signalled that production at the mine could potentially be suspended unless there is a rebound in the coal price. The price of thermal coal was trading at almost $US150 per tonne in 2011, but Goldman Sachs recently forecast that it will average just $US48/tonne in 2016.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, SOUTH32 LIMITED – ASX S32

Wesfarmers regroups for customer focus

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Original article by Sue Mitchell
The Australian Financial Review – Page: 19 & 24 : 25-Feb-16

Wesfarmers has posted a 2015-16 interim net profit of $A1.39bn, which is 1.2 per cent lower than previously. EBIT rose by 1.6 per cent to $A2.11bn and revenue was up 4.7 per cent at $A33.5bn. The group’s retail division posted 9.2 per cent growth in earnings, but its coal operations recorded a loss of $A118m. Meanwhile, Wesfarmers will establish a department store division to house its Kmart and Target businesses, while its industrial and safety businesses will also be restructured.

CORPORATES
WESFARMERS LIMITED – ASX WES, KMART AUSTRALIA LIMITED, TARGET AUSTRALIA PTY LTD, BUNNINGS GROUP LIMITED, COLES GROUP LIMITED, BLACKWOODS, PROTECTOR ALSAFE, CREDIT SUISSE (AUSTRALIA) LIMITED, ALPHINITY INVESTMENT MANAGEMENT PTY LTD, DEUTSCHE BANK AG, CITIGROUP PTY LTD, WOOLWORTHS LIMITED – ASX WOW, MASTERS HOME IMPROVEMENT AUSTRALIA PTY LTD

LNG oversupply could spell gory end for coal

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Original article by Jens Meyer
The Australian Financial Review – Page: 33 : 25-Feb-16

A recent report from the World Bank forecast that the price of Australian thermal coal will rise to $US58 per tonne by 2020. The price of coal exported from Newcastle was trading at $US40 a tonne in late February 2016, having peaked at almost $US130 a tonne in 2011. Macquarie believes that consumption of thermal coal may have peaked, and it warns that a global oversupply of LNG could further reduce demand for coal.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, OIL SEARCH LIMITED – ASX OSH, WORLD BANK

Carbon capture key to coal future: IEA

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Original article by Matt Chambers
The Australian – Page: 16 : 21-Dec-15

The International ­Energy Agency (IEA) forecasts that India’s growing demand for coal will enable Australia to reclaim its status as the largest coal exporter. Meanwhile, IEA executive director Fatih Birol warns that a sustained upturn in coal prices will require coal producers to ramp up their investment in ­carbon capture and storage technology. He adds that carbon sequestration will be essential in meeting the Paris climate change summit’s targets for limiting growth in global warming.

CORPORATES
INTERNATIONAL ENERGY AGENCY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, ADANI ENTERPRISES LIMITED, HANCOCK PROSPECTING PTY LTD

Gold is ‘saving grace’ of miner mid-tier ranks

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Original article by Tess Ingram
The Australian Financial Review – Page: 29 : 10-Nov-15

A report from PricewaterhouseCoopers shows that the combined market capitalisation of Australia’s 50 largest mid-tier mining companies fell by 1.5 per cent in 2014-15, to $A36.2bn. The "Aussie Mine" report also notes that gold producers accounted for 38 per cent of mid-tier companies’ market capitalisation, following strong growth in revenue. The downturn in the price of coal and iron ore had a significant impact on the revenue and market capitalisation of mid-tier companies in these sectors.

CORPORATES
PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD

BHP says China coal tests hurt free trade

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Original article by Amanda Saunders
The Australian Financial Review – Page: 13 & 18 : 2-Nov-15

China’s introduction of quality-testing for imported coal has had no direct impact on BHP Billiton, whose shipments have been cleared. However, BHP executive Shaun Verner believes that some coal exporters have had to sell coal at significantly lower prices in other markets after failing to pass China’s new quality control requirements. He notes that the slump in the price of metallurgical coal means it is costly for a coal producer to have a shipment rejected.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, MINERALS COUNCIL OF AUSTRALIA, AUSTRALIA. DEPT OF FOREIGN AFFAIRS AND TRADE