It is reported that China is likely to turn to other markets for thermal coal if the cost and availability of Australia exports are affected by carbon taxes and environmental concerns.

A study titled Coal and the Commonwealth released by the University of Queensland says China an increasing importer of thermal coal will probably look to Indonesia and Russia for supply if Australia exports are affected.

The report said that "However, the ability of these countries to sustain supply to China is questionable. In the event of volatility in supply, China could revert to exploiting reserves of inferior quality coals located in its central and southern provinces. It is therefore in the world's best interests to continue to make low emission Australian coal available at competitive world prices.”

The report also outlines the emerging new technologies for coal and the rise of the coal seam gas industry.

The report, edited by professors Peter Knights and Mr Michael Hood says proven, probable and possible reserves of CSG now exceed 800 million tonnes larger than the massive liquefied natural gas reserves off the north and west coasts of Australia which is driving significant projects for Australia. With over USD 18 billion of projects in the planning, the CSG industry has the potential to be the next great industry for Australia."

The report says the concept of a cleaner coal is shifting in Australia towards low emission coal technologies. But an audit by the Mr Rudd government own Global Carbon Capture and Storage Institute has found that clean coal power stations are not viable until the carbon price reaches a minimum of USD 60 a tonne a level the Australian government does not anticipate until almost 2030.”

The Australian reported recently that the new USD 100 million a year institute found the business case for clean coal technology could only work if governments helped build the first commercial size carbon capture and storage power plants on a field of dreams or on a build it and they will come basis.

Professor Hood said for the coal industry to move forward, the new technologies were absolutely vital. He added that the CCS programs would be implemented it was just a timing issue and that coal to liquids projects were already being done on the surface.

Resources Minister Mr Martin Ferguson recently said as the world largest exporter of coal and a nation which derived around 80% of its electricity from coal, it was vital that Australia made technological progress on CCS and soon.

(Sourced from The Australian)