- Write by:
-
Saturday, July 28, 2018 - 6:09:06 PM
-
588 Visit
-
Print
Mining News Pro - JOHANNESBURG (miningweekly.com) – Anglo American has drawn a line in the sand for its thermal coal portfolio. With 14 more years of life in existing assets, the company made it clear this week that it would engage in incremental expansion where it made sense, but not in long-term growth projects.
Anglo has halved its footprint in thermal coal over the last five years as part of what it calls a just transition and a slide on long-life optionality shown during Thursday’s interim financial results webcast did not name thermal coal as a growth product, only metallurgical coal, which also got the nod under the heading promoting a better global environment.
Thermal coal also failed to feature under the company’s ‘greener world’ category, which displayed copper as the only metal in the Anglo portfolio that was fully in line with a changing world of improving electrification and innovation, and greater environmental protection to benefit from a growing global middle class.
Anglo currently exports 30-million tonnes a year of export thermal coal, mainly from South Africa, where it has disposed of its Eskom-tied coal to the black-controlled Seriti.
Although thermal coal’s current 14% contribution to revenue puts it on par with copper, copper is receiving all the attention, especially on the new project and on the exploration fronts.
“We’ve got very good assets in thermal coal, very good cost positions. We’re on the cusp of the first cost quartile and we can improve on our productivity on top of what has already been a 40% to 50% productivity improvement in South Africa in the last three and a half years.
“We’ve got 14 years life on average and from our point of view it makes sense to continue to run those quality assets through that process and we’re making sensible capital allocations on incremental life extensions.
“It would certainly be a lot harder for us to justify a big investment in thermal coal that goes beyond the seven year life time, on the basis that there are questions about the value that you see in thermal coal relatively to oil, gas and the whole fossil fuel question,” Anglo CE Mark Cutifani said during a webcast results analysis in which Creamer Media’s Mining Weekly Onlin e took part.
“We’re connecting with our communities, we`re making sure they understand what we`re doing. The governments and the customers that we work for understand exactly where we’re going and we`re making incremental investments, but it would be a lot tougher for us to justify a big investment for a long-term development position in thermal coal given the uncertainties in the price environment. So, it would have to be a very special case.
“Carefully considered, measured as we go and we’ll keep the market and everyone else informed because the CSR conversation is a very important one to us and one we’re very cognisant of, but at the same time we’re not going to bail out tomorrow and many of the CSR stakeholders are very appreciative of the fact that we haven’t run, that we have been clear about a transition and they said we prefer that because we understand the importance of your local communities and the importance of those communities to the big power stations, and it’s better to have a responsible operator like you transitioning with those assets than having others running them who may not be as sensitive as the way you guys will run it,” Cutifani added.
Short Link:
https://www.miningnews.ir/En/News/224007
China’s state planner on Friday finalized a rule to set up a domestic coal production reserve system by 2027, aimed at ...
The world’s coal-fired power capacity grew 2% last year, its highest annual increase since 2016, driven by new builds in ...
Peabody Energy Corp. shares sunk to the lowest in seven months after the biggest US coal miner warned that first-quarter ...
Polish government is abandoning plans to separate coal-fired power plants into a special company and is considering ...
BMO Bank quietly dropped its policy restricting lending to the coal industry in late 2023, helping it avoid being ...
Researchers at the University of Edinburgh discovered that bacteria found in areas polluted by acid mine drainage had ...
BMO Bank quietly dropped its policy restricting lending to the coal industry in late 2023, helping it avoid being ...
Iron ore reversed direction after dropping to its lowest level in 10 months as optimism that the country’s economic ...
Glencore Plc may consider switching its primary listing from London to New York, analysts at Deutsche Bank AG predicted, ...
No comments have been posted yet ...