Why? They have been pushing gas out from the centre and banning coal use progressively since 1998. Most of Beijing already bans the burning of coal. It's only used for heating anyhow. The coal-burning industries were shifted into Hebei 10 years ago.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
I guess in your reality the coal industry never ends up getting the shaft.
It's days are numbered.
Yet in 2012 25% of their power came from coal. Odd.
Not at all. In my opinion most of the thermal coal in the world will be left in the ground.
But China imports essentially zero thermal coal from Australia and very little from anywhere else either. And what thermal coal is imported never gets near Beijing.
News that Beijing is continuing an ongoing programme to stop the use of coal for home heating has no bearing on the Australian coal industry whatsoever.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
Sorry, you are wrong on this. It will have no effect on the Australian coal industry. Brazier coal use compared to power station use can't even be seen on the same chart.
Power stations in China began shifting from coal to gas 15 years ago. Around 1998 a bunch of Australian economists predicted China's coal use in 2010 would be nearly triple what actually turned out to be and saw a glorious future for Australian coal exports. China switched to gas turbine generation soon after and the rest is history.
The next shift under way is from basic oxygen to electric arc furnace for steel recycling. Steel is highly recyclable and the world has plenty of scrap. If the shift to recycled steel is significant, demand for coking coal will decline proportionally.
Gas on the other hand has a great future. Pity China just signed a 20 year agreement with Russia to supply gas at a cheap price. Thank you US foreign policy.
------------------------------ " ... which is that all-too-familiar dynamic in Irish life where people tell lies, cover them up and create all sorts of collateral damage, sometimes spread out over decades, and never take responsibility." - Alan Glynn
Sorry, you are wrong on this. It will have no effect on the Australian coal industry. Brazier coal use compared to power station use can't even be seen on the same chart.
Absolutely.
Quote:
Power stations in China began shifting from coal to gas 15 years ago. Around 1998 a bunch of Australian economists predicted China's coal use in 2010 would be nearly triple what actually turned out to be and saw a glorious future for Australian coal exports. China switched to gas turbine generation soon after and the rest is history.
They also didn't predict the increase in thermal coal production in North China and the improvement in transport to the south. in 1998 Rio was selling coal to Guangdong provinces and its neighbours simply because it was impossible to reliably ship coal from north to south. Then they built the rail link from Shanxi province to Dalian and the coal goes south by ship.
Quote:
The next shift under way is from basic oxygen to electric arc furnace for steel recycling. Steel is highly recyclable and the world has plenty of scrap. If the shift to recycled steel is significant, demand for coking coal will decline proportionally.
Maybe. I suspect the world uses most of its scrap. Back in the mid-2000s I had people chasing me to find scrap in Australia for export to China, but demand far exceeded supply. At some stage though China will produce enough of its own scrap to make a dent in imports of both met coal and iron ore.
Quote:
Gas on the other hand has a great future. Pity China just signed a 20 year agreement with Russia to supply gas at a cheap price. Thank you US foreign policy.
It's a significant deal, but the price ain't all that cheap. Gas price is the same as what Russia sells to Europe at, and China has to pay a lot of the investment required for the pipeline as well. China is still building LNG import terminals down south at a fair clip, so they obviously have a combined LNG/pipeline from Russia/local Shale gas strategy. Maybe one day they will have a pipeline infrastructure like the US and not need to import LNG, but it is a long way away.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
100 years ago a famous thinker concluded that there was only 1000 years of coal beds left. He was right, for the level of consumption back then. All the useful coal will be gone in another couple of decades at current consumptions. Then we we find out first hand how easy it is to generate electricity to make electric cars and lay futuristic oil free road surface. I can't wait myself, surviving and living a good life will be like taking candy from a baby.
The majority of Australians think they week to week but in reality they live 5 years or more in debt.
Shadow was hopelessly wrong about the Gold Bull Market. What else is he wrong about?
Maybe. I suspect the world uses most of its scrap. Back in the mid-2000s I had people chasing me to find scrap in Australia for export to China, but demand far exceeded supply. At some stage though China will produce enough of its own scrap to make a dent in imports of both met coal and iron ore.
We recycle about 70% in Australia. Presumably because some scrap metal has too much plastic/enamel/whatever attached to it which makes the blast furnace fumes toxic. I don't think they would worry about that in China. Some of the Chinese car/truck fleet will soon reach the age of accelerated retirement of old vehicles, so maybe that will be a source for scrap. Problem with recycling rebar is cleaning the concrete off so you don't get too much slag.
Quote:
It's a significant deal, but the price ain't all that cheap. Gas price is the same as what Russia sells to Europe at, and China has to pay a lot of the investment required for the pipeline as well.
The price is cheap compared to Australian producers though. I think it was around $9.90/MMBTU, current spot price in Europe is around $9.30/MMBTU, but that could get interesting soon re: Ukraine.
Quote:
China is still building LNG import terminals down south at a fair clip, so they obviously have a combined LNG/pipeline from Russia/local Shale gas strategy. Maybe one day they will have a pipeline infrastructure like the US and not need to import LNG, but it is a long way away.
They seem to build certain key infrastructure items pretty quick when they decide to. Benefits of a command/control political system. I don't think they will be so silly as to go down the Shale gas route, maybe CSG. Shale gas is shaping up to be the dotcom boom of the noughties.
In any case, I think the days of bogans digging holes in the desert for $200K per year are probably over.
------------------------------ " ... which is that all-too-familiar dynamic in Irish life where people tell lies, cover them up and create all sorts of collateral damage, sometimes spread out over decades, and never take responsibility." - Alan Glynn
The price is cheap compared to Australian producers though. I think it was around $9.90/MMBTU, current spot price in Europe is around $9.30/MMBTU, but that could get interesting soon re: Ukraine.
They seem to build certain key infrastructure items pretty quick when they decide to. Benefits of a command/control political system. I don't think they will be so silly as to go down the Shale gas route, maybe CSG. Shale gas is shaping up to be the dotcom boom of the noughties.
In any case, I think the days of bogans digging holes in the desert for $200K per year are probably over.
Well, it worked out at $10.70 actually, and you have to remember that it is piped gas. LNG is more expensive by about $4 (?) because of the cost of liquefaction, shipping and regasification. However you don't have to maintain a pipeline. The price seems to me to be carefully chosen so that it is competitive with LNG in the north, but by the time you pipe it 3000k to the south it is more expensive than LNG. None of that Russian gas will make it as far south as Beijing, let alone to the southern provinces. Hence the three new LNG terminals in south China that opened in the second half of 2013.
The Chinese are already starting to exploit their shale gas, but it is a slow ramp because locally they lack technology and don't allow foreign investment in the energy sector. Their reserves are pretty huge. This, more than anything, will drive a pipeline network I guess. It's all in the western provinces but it is needed in the centre and on the eastern seaboard. There is already a pipeline coming in from Russia in the northwest as well as pipes coming in from the 'stans.
It's gonna be interesting to see how it plays out over 5 years or so. You make a good point about China being able to do infrastructure like pipelines and railroads quickly and efficiently. After all, China will spend $100B on railroads this year and get 6000km of railroad for it. Victoria is spending $1B per km for new highway at the moment and NSW about the same per km of suburban light rail. One wonders which country is more corrupt when one looks at those numbers.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
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