China Bohai Thermal coal prices hit all time high

Friday, 04 Nov 2011

It is reported that the latest Bohai-Rim Steam-Coal Price Index or BSPI indicates that the average price of thermal coal with calorific value of 5500 kilocalories per kilogram reached an all-time high of CNY 853 per tonne in the week ending October 26.

The price was up CNY 6 per tonne or 0.71%t from a week earlier and an increase of CNY 28 per tonne compared with September 7 when a rebound was seen after nine consecutive weeks’ fall.

At Qinhuangdao port, the price of 5500 kilocalories per kilogram and 5800 kilocalories per kilogram thermal coal was up CNY 5 per tonne to CNY 850 per tonne to CNY 860 per tonne and CNY 900 per tonne to CNY 910 per tonne respectively compared with the previous week while that of 4500 kilocalories per kilogram and 5000 kilocalories per kilogram thermal coal kept stable at CNY 650 per tonne to CNY 660 per tonne and CNY 745 per tonne to CNY 755 per tonne.

In China's main coal-producing regions, such as Shanxi and Inner Mongolia, coal prices have remained stable after previous weeks upswing. Coal prices in these two regions have perched high for several weeks on speculation that China may face another round of power shortage in the coming winter. And the tough coal transport capacity may be one of the main reasons to bolster up the price.

(source: steelhome.cn/en)

Shanxi makes bid for stake in Pike River Coal

Monday, October31, 2011

Giant Chinese state-owned Shanxi Coal is understood to be in the running to buy Pike River Coal as part of a joint bid with New Zealand coal company Solid Energy.

Bids closed a week ago, with four players making offers, sources said.

One Indian company earlier interested in making an offer had pulled out, but another Indian company was still understood to be in the running, they said.

There has also been interest from an unnamed Australian company, but it remained unclear if it made a final bid.

Rumours have been around for a couple of weeks that a Chinese government agency was involved in a joint bid with Solid Energy for Pike.

Another industry source said if Shanxi joined Solid Energy as a partner in Pike River it could provide the financial muscle to reopen the mine and be a large customer, with Solid Energy providing the local expertise. China has a huge appetite for coal, which has been a key driver of its economic growth.

Chinese imports of coal have recently hit record levels, up 15 per cent in September to a record 19 million tonnes in a month.

There has been industry concern a Chinese or Indian company could come in with a high price and pick up the Pike River assets without the involvement of a local player.

The Pike mine remained a "technical challenge" and a player from overseas might not have the right skills to mine in what was a difficult area, a source said.

It would be surprising if the mine reopened within three to five years under new owners, sources said.

A joint-venture deal might also put Shanxi in a good position to take a stake in Solid Energy, should the Government decide to sell part of the company, an industry source said.

The Government says it plans to look at selling up to 49 per cent of three state-owned power companies, Solid Energy and reducing its holding in Air New Zealand should it be re-elected.

However, another source said a joint venture would not necessarily give Shanxi any advantage if part of Solid Energy were up for sale. Solid Energy already has a joint venture with international coal company Cargill, which bought 49 per cent of the Spring Creek underground coalmine near Greymouth four years ago.

Pike's receiver has declined to comment on the bidding.

Solid Energy has said it is interested in Pike, but it has refused to confirm or deny suggestions it will make a joint bid with a Chinese coal company.

The receivers want bidders to remain anonymous, given that a deal could be hampered if details are made public too soon.

Pike River collapsed into receivership almost a year ago, after a mine explosion that killed 29 men. It is expected the sale of the assets could take at least until Christmas to confirm, with foreign buyers facing Overseas Investment Office and other government approvals.
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A price of about $50 million would clear Pike's debts, with anything above that potentially offering some return to Pike shareholders. The Pike field holds billions of dollars of coal.

In the past year, Solid Energy posted revenues of $829m, and made an after-tax profit of $87.2m, up 29 per cent.

Shanxi Coal's website says it aims to become a "super-large" enterprise group in the next five years with a target of producing 50 million tonnes of coal a year and to handle trade of 100 million tonnes as an import-export business. Shanxi province is southwest of Beijing.

The company runs 20 coalmines and has assets of more than 13 billion remnimbi (NZ$2.5 billion) and more than 7000 staff. Shanxi Coal is one of the top 10 state-owned businesses in the province. Annual revenues were about 22 billion remnimbi, with profits of more than 1 billion remnimbi.

sourced Stuff.co.nz

Shanxi Coking Co Sept coke output hit record high

Wed, 19 Oct 2011

Shanxi Coking Co located in Northern China Shanxi province, announced that its coke output reached the highest level in September since its coking plants put into operation.

The state owned coal mining company produced 278,432.29 tonnes of coke last month. In January through September, coke output totalled 2,285,421.56 tonnes accounting for 74.08% of the company annual target.

(By steelhome)

Huadian Power to buy 85pct stake in Haoyuan Coal

Friday, 16 Sep 2011

China Knowledge reported that Huadian Power International Co Ltd the largest power producer in Shandong Province of China will acquire a 85% stake in Inner Mongolia Haoyuan Coal Co for CNY 715 million.

Upon the completion of the acquisition, Huadian Power International will acquire a colliery located in Erdos of the Inner Mongolia Autonomous Region with recoverable coal reserves of 54.6 million tonnes.

The colliery currently has an annual output capacity of 600,000 tonnes, which is expected to increase to 1.2 million tonnes in the fourth quarter of this year.

Since 2009, Shanghai and Hong Kong listed Huadian Power International has acquired coal assets with an annual output capacity totaling 12 million tonnes principally in Shanxi Province, the Inner Mongolia, the Ningxia Hui Autonomous Region and Anhui Province.

(Sourced from China Knowledge)

Shanxi monthly coal output breaks new high in June

Friday, 12 Aug 2011

According to Shanxi Bureau of Statistics that, in June the leading coal producing province in China churned out an all time high 78.15 million tonnes of raw coal, increasing by 26.2%YoY and 4.82 million tonnes over May. The cumulative output in January to June totals 411 million tonnes rising by 21.5%.

The volume of Shanxi coal exiting the province has also set a new record by 53.56 million tonnes up by 1.82 million tonnes MoM and 15.4%YoY. The total amount in January to June touches 284.75 million tonnes up by 9.3%YoY.

Analysts say coal industry dominates Shanxi industrial economic development while PPI fluctuation greatly affects industrial economic benefits. Global oil price especially imported coal price volatility largely determines domestic coal rates. Macro-control policies and market demand shifts remain major influences in Shanxi’s economic quality. Based on those, analysts estimate a steady and fast growth for Shanxi’s industrial economy in the second half of 2011.

(sourced MySteel.net)

Shanxi Province to produce 780 million mt of coal in 2011

Tuesday, 26 April 2011

As stated at a conference on coal mining held in China's Shanxi Province, a total volume of 780 million mt of coal is expected to be produced in Shanxi in 2011.

In Shanxi, over 600 coal projects are either under construction or have recently started production, totaling an annual coal production capacity of 600 million mt. In 2011, Shanxi will complete investments of RMB 75 billion ($11.45 billion) in coal projects, accounting for 10 percent of total provincial investment.

The Shanxi authorities have also stated that after 2012 the number of coal mines in the province will no longer be increased.(By SteelOrbis)


Tags: coking coal , raw mat , China , Far East , East Asia and Pacific , Southeast Asia , steelmaking , production

Coal capacity expands at Inner Mongolia and Shanxi

Feb 21, 2011

North China’s Inner Mongolia Autonomous region that produced 787mt last year is to raise capacity to 900 million tonnes in 2011, while coal-rich Shanxi province with an output of 737 million tonnes in 2010 will achieve a 850 million tonnes of capacity this year, announced the National Development and Reform Commission on Feb 11.

Local coal agencies expect capacities to be further lifted to 1 billion tonnes in Inner Mongolia by 2015, but in Shanxi a marginal increase to 960 million tonnes is projected.

Inner Mongolia produced 69.6 million tonnes in Jan, up 26.7% from the same month of last year, but down 21.8% from Dec, while Shanxi mined 58.17 million tonnes, decreasing 4.7% year on year and plunging 18.5% month on month.

The NDRC predicts a slowdown in coal consumption growth this year due to environmental pressures but did not give details.

(sourced:China Coal Times)

Shanxi’s raw coal output up 9.4 pct in Jan 2011

Saturday,Feb19,2011

Coal produced by coal-rich Shanxi province of North China witnessed a year-on-year increase of 9.4 percent in raw coal output to 57.08 million tonnes in Jan, Shanxi News reported, citing local authorities.

During the month, Shanxi produced 6.56 million tonnes coke, growing 3.5 percent on year, showed data issued by the provincial bureau of statistics on Feb 17.

And, the province produced a total of 2.82 million tonnes pig iron and 2.51 million tonnes crude steel, growing 6.1 percent and 4.6 percent respectively from same period last year, data showed.

Shanxi generated 19.5 billion kWh electricity in Jan, growing 2.7 percent on year, it added.
(sourced:en.sxcoal)

Puda Coal Provides Update on Coal Mine Projects in 2011

January 24, 2011,

TAIYUAN, SHANXI PROVINCE, China,(Coal Geology) Puda Coal, Inc. (NYSE Amex: PUDA) (“Puda Coal” or the “Company”), a supplier of high grade metallurgical coking coal used to produce coke for steel manufacturing in China and consolidator of nine coal mines in Pinglu County Yuncheng City (“Pinglu Project”) and four coking coal mines in Huozhou County Linfen City (“Jianhe Project”) in Shanxi Province, today provided additional updates on the status of the Company’s coal mine consolidation projects.Background o n coal mine consolidation
As previously disclosed, pursuant to the policy of the Shanxi provincial government, Shanxi Puda Coal Group Co. Inc. (“Shanxi Coal”), a 90% subsidiary of the Company, is approved by the government to acquire nine thermal coal mines in Pinglu County and consolidate them into five mines. The coal mines under the Pinglu Project have aggregated reserves of approximately 163.9 million metric tons (MT), based on government records, which were filed by original mine owners and will be expanded from pre-consolidation production capacity of 1.1 million MT to post-consolidation annual production capacity of 3.6 million MT. Shanxi Coal also received the government’s approval to acquire four metallurgical coal mines in Jianhe County and consolidate them into one large metallurgical mining operation. The Jianhe project has total recoverable reserves of 23.7 million MT, based on government records filed by original mine owners, and annual production capacity will be expanded from 720,000 MT to 900,000 MT once consolidation is complete.

The coal mine consolidation process is administered by the government and has four stages, which can proceed in parallel, but the overall process is as follows: (1) Shanxi Coal purchases coal mine assets and mining rights of target coal mines; (2) the government reviews and approves all comprehensive pre-construction design reports on geology, preliminary construction design, safety and environmental protection prepared by Shanxi Coal; (3) Shanxi Coal engages in construction upgrades, technological enhancements and capacity expansion. Since the technological upgrades and capacity improvements are carried out on existing coal mines with good operating records, coal will be produced during the construction period but will be produced at a reduced level; and (4) the government inspects the construction quality, environmental and safety practices at the improved coal mines and issue operating licenses.

Pinglu Project Update
Pursuant to the government’s approval, Shanxi Coal established five project coal companies to hold the mining assets of nine target coal mines and consolidate the nine coal mines into five mines. Shanxi Coal is developing the Pinglu Project in two phases: Phase I is being developed solely by Shanxi Coal; Phase II is co-developed by Shanxi Coal, Mr. Ming Zhao, Chairman and a significant shareholder of the Company and Mr. Jianping Gao, an unrelated party. For Phase II of Pinglu Project, Shanxi Coal is responsible for 40% of the total investment, Mr. Zhao is responsible for 30% and Mr. Gao is responsible for the remaining 30%. Shanxi Coal will control and manage both phases of Pinglu Project. The pre- and post- consolidation capacity of the coal mines are presented below:

* Indicate those mines that will be closed during the consolidation according to the construction plan of Shanxi Coal. The coal reserves under the mines will be merged respectively to nearby upgraded coal mines and the historical production capacity of these coals is not calculated into the total historical capacity of 1,100,000 MT.
Under Phase I of the Pinglu Project, the government has approved the designed production expansion of Dajinhe Coal, which began construction on January 1, 2011. The Company estimates that Dajinhe Coal will produce approximately 150,000 to 290,000 MT of thermal coal during the construction period, which Shanxi Coal expects to be eight to twelve months. In addition, the government has approved the geological technical report and preliminary construction design of Dajinhe Wujin. Shanxi Coal’s next step is to secure the government’s approval to begin construction of the designed production expansion of Dajinhe Wujin.

Under Phase II of the Pinglu Project, Shanxi Coal has completed the acquisition of coal mining rights and assets of four coal mines: Xuhutuo Coal, Daqi Coal, Renling Coal and Donggou Coal. Shanxi Coal has also entered into coal mining rights and mining asset transfer agreements with the remaining three coal mines: Anrui Coal, Chuntouao Coal and Xiapingcun Coal. Shanxi Coal has paid approximately $34 million, representing 50% of the purchase prices, for the mining assets of the three remaining mines and expects the acquisitions to close in January 2011. Shanxi Coal has received approval on the geological technical report for project company Dajinhe Anrui and aims to receive construction approval for project companies Dajinhe Anrui and Dajinhe Jinyi by May 2011 and for Dajinhe Jinmen by July 2011.
The Company estimates that in fiscal year 2011 raw coal produced during the construction period of the Pinglu Project will be about 849,000 MT.

Jianhe Project Update
Pursuant to the government’s approval, Shanxi Coal established a project coal company, Shanxi Huozhou Lituo Coal Industry Ltd (“Lituo Coal”) to hold the mining assets of the four target coal mines upon acquisition and consolidate these mines into one.
Shanxi Coal will develop the mines under the Jianhe Project and intends to enter into mining asset purchase agreements with the four target coal mines by February 2011. Shanxi Coal has completed a geological technical report on Lituo Coal, which is currently being reviewed by the government and Shanxi Coal expects to receive construction approval by June 2011. Shanxi Coal anticipates that it will take about eight to ten months to complete the construction upgrades and consolidation of the mines under the Jianhe Project after receiving construction approval.

Shanxi Coal plans to retain international geological prospecting firms to conduct geological technical prospecting on the reserves of the mines under the Pinglu Project and Jianhe Project based on international standards.

About Puda Coal , Inc.
Puda Coal, through its subsidiaries, supplies premium high grade metallurgical coking coal used to produce coke for steel manufacturing in China. The Company currently possesses 3.5 million metric tons of annual coking coal capacity. The Company is in the process of adding coal mining operations to its business, as an acquirer and consolidator and acquirer of coal mines in Shanxi Province. On September 30, 2009, Shanxi Coal, a 90% indirect subsidiary of the Company, was appointed by the Shanxi provincial government as an acquirer and consolidator of eight thermal coal mines located Pinglu County in southern Shanxi Province. Shanxi Coal plans to consolidate the nine coal mines into five, increasing their total annual capacity from approximately 1.1 million to 3.6 million metric tons. Shanxi Coal received another approval by the Shanxi provincial government to consolidate four additional coking coal mines into one coal mine in Huozhou County. After the completion of the consolidation, the Jianhe project is expected to increase the total annual capacity from 720,000 metric tons to 900,000 metric tons, according to the Shanxi provincial government’s approval.