Coal Age

DEC 2017

Coal Age Magazine - For more than 100 years, Coal Age has been the magazine that readers can trust for guidance and insight on this important industry.

Issue link: https://coal.epubxp.com/i/917376

Contents of this Issue

Navigation

Page 9 of 51

8 www.coalage.com December 2017 news continued $19.5 million and $6.9 million, respectively, a year ago. Revenues totaled $69.8 million in the quarter, driven by sales volume of 1.6 million tons and average sales revenue of $44.16/ton. Alliance Sees Stronger Q4 Sales Alliance Resource Partners is forecasting strong coal sales in the fourth quarter of 2017, with shipments possibly reaching 10.8 million short tons, as its Hamilton longwall mine in southern Illi- nois recovers from adverse geological conditions that hampered production during the third quarter. The Tulsa, Oklahoma-based company is sold out for 2017, and late this fall booked additional sales commitments of 2.5 million tons of export shipments and 1.2 million tons of domestic deliveries in 2018, according to Joe Craft, Alliance's president and CEO. With those commitments, Alliance now is approximately 70% priced and committed for 2018, he said. Hamilton was expected to play an important role in helping Alliance meet its production goals not only in the October-December period, but next year as well. Alliance acquired the mine near McLeansboro in Hamilton County several years ago from privately owned White Oak Re- sources Corp. Craft said the company anticipates some residual impact on production in the fourth quarter as Hamilton ramps back up after encountering adverse geological conditions following a longwall move in August. But there should be no long-term effects for the mine and production, he said. "We believe that's all been factored and we know that's been factored into our tonnage estimates or sales estimates in our guidance that we're giving. So, we believe that that issue is behind us going into the fourth quarter and fin- ishing this [longwall] panel." Alliance, which once mostly eschewed the export coal mar- ket, has warmed to seaborne sales in recent years. The company mainly is shipping to Europe and India, he said. Alliance already has secured 2.5 million tons of export sales in 2018. Exports have played a major role in supporting U.S. coal pric- es in 2017, Craft noted, and it appears domestic markets "have bottomed out as coal prices have rebounded off very low levels." Alliance, he said, continues to believe that higher-cost coal pro- duction will come out of the market, "providing further support for improving coal prices." Craft said Alliance foresees U.S. electric utility demand in 2018 that is comparable to 2017. "We believe that with supply and demand imbalance that should give a lift to prices [in 2018] compared to 2017, where some utilities had the luxury of buying out — taking out of inventory if they didn't see the prices that they liked when they went out to bid." Utilities, he added, have contracted for coal at levels below their anticipated burn requirements for 2018, "resulting in our open position over the next several years being higher than in years past." However, based on Alliance's recent discussions with customers, the company anticipates "demand in 2018 for eastern U.S. coal production will be comparable to this year, requiring utilities to continue to contract tonnage to fulfill their remaining open positions." Craft said he does not foresee utilities switching more to nat- ural gas in 2018 despite the scheduled completion of new gas transmission lines in the midwest and eastern U.S. Continued from p. 7... Continued on p. 9... Kalimantan, Indonesia. The contract will extend the current life-of- mine contract, increasing coal production at the Melawan pit by 12 million metric tons and overburden removal by 130 million bank cubic meters (bcm) over four years, until December 2021. CIMIC Group Chief Executive Officer-Elect Michael Wright said, "This contract demonstrates Thiess' long-standing commitment to delivering value to our clients across our global mining platform. I am so pleased to see our team continue to grow and prosper in Indonesia, where we have been operating for some 29 years." CIMIC Group Mining and Minerals Executive and Thiess Man- aging Director Douglas Thompson said, "I'm delighted to strength- en our partnership with KPC as we work together to deliver cost-ef- fective outcomes. "This expansion builds on our successful history at Sangatta where we have been operating since 2003 and reflects our ability to deliver cost-effective and scalable solutions tailored to our client's production and expansion needs." CoAL Changes Name to MC Mining At its annual general meeting, shareholders of Coal of Africa Ltd. (CoAL) shareholders completed a 20:1 share consolidation and ap- proved the company's name change to MC Mining Ltd. With projects under consideration, the company currently operates Vele Colliery, which is targeting a production level of 2.7 million metric tons per (mtpy) of run-of-mine thermal coal. The company's Makhado Proj- ect, located 80 kilometers southeast of Vele, is its most advanced feasibility-stage project. China's Coal-rich Province Cuts Production Capacity The northern Chinese coal-rich province of Shanxi has reduced 45.9 million metric tons (mt) of coal production capacity, after closing 52 mines in the past two years, according to Xinhua. The province closed 27 coal mines this year, with a total production capacity of 22.7 million mt, Wang Shouzhen, director general of the Shanxi Coal Industry Association, told a coal trade conference recently in Taiyuan, capital of Shanxi. "The capacity reduction has helped lift coal prices and allowed the once loss-making industry to report 23.4 billion yuan ($3.5 bil- lion) in net profits in the first 10 months of the year," Shouzhen said. Coal output in Shanxi rose 9.6% year-on-year to 727 million mt in the January-October period, while sales rose 8.41% to 655 million mt, he said. Shouzhen said the overcapacity-plagued coal industry still faced market uncertainties. North Korean Coal Piles Up Stranded by the interdiction, a mountain of North Korean coal, which would once have been bound for China, is piling up at the Rajin Harbour, according to AFP. On the very next dock, roughly 2 million metric tons (mt) of Russian coal has been delivered by rail and will be transloaded to China by the Russian port operator Ra- sonConTrans. Its activities are specifically excluded from the U.N. Security Council's sanctions resolutions, but attempts have been made to use it as a way to bypass the restrictions, AFP reported. "They asked but we said no, we don't do it," said RasonCon- Trans' deputy director Roman Minkevich. The black mounds on the neighboring pier were evidence his firm was complying with the rules, he added. China imported 22 million mt worth nearly $1.2 billion in 2016. Now, RasonConTrans' business is booming. Since starting opera-

Articles in this issue

Links on this page

Archives of this issue

view archives of Coal Age - DEC 2017