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