Adam Morton reports in The Guardian (25.8.17) on the proposed Adani coal mine project in central Queensland, asking if India and China are shifting away from coal imports and coal-fired power, where does this leave coal in Australia?
‘Last month [the International Energy Agency] released a report that pointed to a rupture more far reaching than the 1970s oil embargo. It suggested investment in new coal power across the globe has peaked and is on the verge of a steep decline. In a coinciding media briefing, the IEA chief economist, Laszlo Varro, declared the “century of coal” that started in 2000 – evident in the extraordinary wave of investment by emerging Asian nations – may already be over.
‘“It is becoming clear that Chinese coal demand has peaked,” he went on. “The outlook for imports [to] India and other countries is uncertain”.
‘What does this mean for Australia, producer of about 30% of the world’s coal, as it plans a vast expansion in production in outback Queensland?
‘… In a report for the Australian Conservation Foundation, consultants ACIL Allen agreed. “At present, there is considerable pessimism regarding the long-term outlook for prices of thermal coal in international markets,” it said. “This is reflected in forecasts by credible Australian and international agencies”.
‘Citi forecasts modest growth in Australian thermal coal exports in the near term, including the potential expansion of a couple of mines. But with prices expected to fall to US$60 a tonne by the end of the decade, down from a US$110 peak late last year, it sees no incentive for investment in new major projects – especially given public opposition and investor apathy towards coal.
‘It makes for an unlikely environment in which to develop a mega-mine backed by public money. But that is what Australia is considering.’