SWOT Analysis of Overseas Coal Opportunities[1]

Ashish Gupta, Observer Research Foundation

Countries Australia Indonesia South Africa Mozambique Colombia
Reserves in Billion Tonnes (BT) 76.4 28 30 16 (extensive study required) 6.7

 

R/ P Ratio (years) 160 67 117 Not known 79
Coal Regions Queensland & New South

Wales (exploited).

Surat Basin & Galilee Basin

(partly exploited)

Sumatra & Kalimantan

(exploited).

Papua, Java, Maluku

& Sulawesi (partly

exploited).

Highveld (exploited),

Witbank, Ermelo,

Waterberg, Vereeniging

South Rand, Utrechet and

Klip River are open for exploration.

Tete and Niassa are open for exploration

 

Cesar, Guagira,

Boyaca and

Cundinamarca are open for exploration

 

Coal Quality High Medium & low Medium & low Good High
Mining Status Highly mechanised Labour intensive Labour intensive Labour intensive Not known
Cost of Mining Very costly Labour is cheap Labour prices increased dramatically  by 9.6% in 2013 Labour is cheap Labour is cheap
Policy Framework Conducive Skewed towards indigenous players Conducive. Does not have any concrete energy policy in place Conducive. No local equity/ ownership required Conducive
Rail Infrastructure Heavy investment required Heavy investment required Not very good Not very good Not very good
Port Infrastructure Expanding Not a problem Expanding but heavy investment required Expanding but heavy investment required Expanding but heavy investment required
Cumulative Additions to coal terminal capacity 2015 -19 (MT[2]) 40 55 27 10 43
Planned Investment in Port  Infrastructure $ 10 billion Dudgeon Point

Coal Terminal

$ 5 million PT Bara Ria Sukses’s Jambi

Coal Terminal

$ 1.5 billion terminal at Richards

Bay by Transnet

Expansion of port of Macuse Cerrejon $ 1.3 billion infrastructure

expansion programme

 

Planned Investment in Rail Infrastructure $ 700 million rail track at the Port of Newcastle $ 2.4 billion for b 191 km rail line from Kutai Barat to Balikpapan in East Kalimantan $ 1 billion railway coal link project from Mpumalanga region to

Richards Bay

$ 4 billion rail link under study for

530 km from Moatize to the port of Macuse

 

$ 700 million railway line project from

Colombia’s new port of Puerto Brisa with Central Railway and $ 1.3 billion  infrastructure project at Rio Magdalena

Proximity to Indian Ports 18 days to-Indian west coast and 14 days to Indian east coast 12 days to-Indian west coast and 9 days to Indian east coast 12 days to-Indian west coast and 14 days to Indian east coast 10 days to-Indian west coast and 12 +1/2 days to Indian east coast Voyage distance will be long and will further increase the cost
Shipping Cost $/Tonne[3] 79 50 50 48 55
Attractiveness Import only coking coal Good Better Best Moderate

Views are those of the author                    

Author can be contacted at ashishgupta@orfonline.org

[1] Also Refer, ORF, “Dynamics of Importing Coal: Lessons for India, India, October, 2012

[2] Probable figure from IEA, “Medium term Coal Market Report”, 2014

[3]  supply cost to North West Europe

Courtesy: Energy News Monitor | Volume XI; Issue 33

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