It is reported that Xstrata Coal is transitioning to a very sophisticated, highly efficient, low cost opencast coal business in South Africa modeled on the best operations the company runs elsewhere in the world.
Mr Peter Freyberg CEO of Xstrata Coal said that Xstrata Coal which has a mix of thermal and coking coal managed the production of 109 million tonnes of coal last year and is the world’s largest producer of seaborne traded thermal coal.
It produces 66 million tonnes of coal in Australia from 18 mines, 24 million tonnes in South Africa from 11 mines and 19 million tonnes from three mines in South America. The mines are combined into complexes in order to unlock regional synergies.
Mr Murray Houston executive of Xstrata Coal said that 44% of the world’s population still account for comparatively little energy demand. He said that there are still many countries that still have a long way to go to reach the energy consumption levels of First World countries.
Because coal use is correlated with economic
activity growth in energy demand in emerging countries is poised to drive a huge increase in the consumption of energy, with coal playing a significant role.
Of the 5 billion tonnes of thermal coal consumed in the world a year 4.3 billion tons is produced and consumed within the countries as domestic consumption. Some 650 million tons of thermal coal is exported a year, 50 million tons of which is land traded, leaving 600 million tons of seaborne trade in which Xstrata Coal has a dominant position.
Within the 4.3 billion tonnes, the US consumes just under a billion tonnes of coal a year and for many years, the US has been a net importer of coal although at a reduced rate last year during the period of heady prices. But it is now poised to go back to being a net importer of 25 million tons.
Likewise, Xstrata Coal expects that China will be a net importer of about 35 million tonnes in 2009.
While the 25 million tonne swing in the US and the 35 million tonne swing in China appear to be relatively small in those markets, the swing can have an enormous impact
either within the 200 million tonne Atlantic Basin, where it could be 10% or in the 400 million Pacific Basin, where a 10% swing can
have a significant impact.
Mr Peter Freyberg said that “The trend towards exporting less and
importing more is a very strong one and we have been calling that for a number of years now. Last year, the market was essentially in balance. This year, in the first half, it was a net import position of 26 million tonnes, with pricing playing a big role.”
(Sourced from Creamer Media')
