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Thursday, 26 November 20
DECLINE IN COAL EXPORTS ADDS TO NAVAJO-OWNED COMPANY'S PROBLEMS - IEEFA U.S.
 Weak demand and low prices are likely creating steep losses for NTEC
U.S. coal exports to Asia—once heralded as the saving grace for struggling coal producers in the western United States—are facing new strains from low prices and weak demand in the wake of the global COVID-19 crisis.
In its third-quarter financial statement released earlier this month, Westshore Terminals in British Columbia, the primary terminal for U.S. thermal coal bound for the Pacific Rim of Asia, reported a 47% quarter-over-quarter drop in thermal coal exports. Quarterly thermal coal shipments from the terminal fell to their lowest level since 2016, when global coal markets were overwhelmed by a massive supply glut that sent seaborne coal prices crashing.
Even though the Westshore terminal is in Canada, virtually all of its shipments of thermal coal—the type burned in power plants—come from U.S. mines, mostly located in Montana. Data from the U.S. Mine Safety and Health Administration suggest that Montana’s Spring Creek mine, owned by the Navajo Transitional Energy Company (NTEC), bore the brunt of the decline. Coal production at Spring Creek totaled 2.2 million tons during the third quarter of 2020, down from about 3.9 million tons during the year-ago quarter. On an annualized basis, Spring Creek production has now fallen to its lowest level since 2003 (See Figure 1).
Meanwhile, production at the Signal Peak mine, the other major U.S. thermal coal exporter that ships through Westshore, held roughly steady compared to the year-ago quarter. (Signal Peak has been in the news for other reasons, having to do with a fraud and embezzlement scheme perpetrated by former executives. Signal Peak is partially owned by FirstEnergy, also in the news for fraud allegations.) Westshore doesn’t disclose its customer volumes, but Signal Peak’s relatively stable production during the quarter suggests that NTEC’s Spring Creek mine accounted for the bulk of the decline in thermal coal exports through Westshore.
In a related wrinkle, Westshore reported that it took in “$2.6 million [Canadian] of customer shortfall payments” from July through September. This means that at least one of the terminal’s shippers is paying penalties for shipping less coal than promised.
If last quarter’s shortfall payments are indeed coming from NTEC, the company is probably paying even more in penalties to BNSF, the rail company that moves Spring Creek coal to Westshore. (Documents from the 2019 bankruptcy filing of Cloud Peak Energy, the previous owner of the mine, suggest the company paid a little over $25 per ton in rail fees, more than twice as much as Westshore charges to ship a ton of coal.)
Cloud Peak shelled out millions of dollars in such payments to both BNSF and Westshore during times of low international prices, and—ironically enough—frequently shipped coal at a loss to avoid even steeper losses from contractual penalties.
NTEC touted its purchase in 2019 of Powder River Basin mines as a “prudent investment,” pointing to a study (commissioned by the company itself) arguing that Spring Creek exports held the “potential for high profitability.” Yet Cloud Peak had also had made big bets on Spring Creek exports—and those bets helped cement the company’s financial collapse.
Now, NTEC’s gamble on coal exports is backfiring—just as it backfired on Cloud Peak.
This will only worsen difficulties for NTEC, which has recently agreed to an ill-advised expansion of its stake in the aging coal-fired Four Corners power plant in New Mexico and whose core business—coal production for the domestic electricity industry—is in severe decline, and not just because of COVID but because utility companies continue to aggressively abandon coal for cheaper and more modern forms of generation.
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Friday, 30 April 21
HIGH-SULPHUR FUEL OIL SALES REBOUND AFTER PRE-IMO 2020 - BIMCO
HSFO sales are up 47.2% from Q1 2020, reaching 3.1m tonnes. This is however still less than a third of high-sulphur fuel sales in Q1 2019, before t ...
Wednesday, 28 April 21
MARKET INSIGHT - INTERMODAL
Despite the current challenges as a result of the global pandemic, 2021 is turning out to be a landmark year for the iron ore market with spot pric ...
Monday, 26 April 21
CHINA TO FURTHER CUT COAL USE IN 2021 - XINHUA
China aims to reduce the share of coal in its energy mix to less than 56% this year, according to a guideline released by the National Energy Admin ...
Wednesday, 21 April 21
COAL FINANCING COSTS HAVE SURGED IN PAST 10 YEARS - UNIVERSITY OF OXFORD - THE GUARDIAN
Coal financing costs have surged over the last decade as investors demand returns four times as high as the payoff required from renewable energy p ...
Tuesday, 20 April 21
US DOLLAR LIBOR TRANSITION IN ASSET FINANCE - WHERE ARE WE NOW? - WATSON FARLEY & WILLIAMS
Since our last article, there has been a raft of regulatory and market body announcements relating to the transition away from LIBOR and the follow ...
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- London Commodity Brokers - England
- IHS Mccloskey Coal Group - USA
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- ASAPP Information Group - India
- Ceylon Electricity Board - Sri Lanka
- Vijayanagar Sugar Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Vizag Seaport Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Ind-Barath Power Infra Limited - India
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Goldman Sachs - Singapore
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- South Luzon Thermal Energy Corporation
- Eastern Energy - Thailand
- Indogreen Group - Indonesia
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Aboitiz Power Corporation - Philippines
- Tata Chemicals Ltd - India
- Medco Energi Mining Internasional
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bhushan Steel Limited - India
- Maheswari Brothers Coal Limited - India
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- PTC India Limited - India
- Standard Chartered Bank - UAE
- Kideco Jaya Agung - Indonesia
- Minerals Council of Australia
- Romanian Commodities Exchange
- Rashtriya Ispat Nigam Limited - India
- Mjunction Services Limited - India
- Vedanta Resources Plc - India
- LBH Netherlands Bv - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Coalindo Energy - Indonesia
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- Pendopo Energi Batubara - Indonesia
- Indonesian Coal Mining Association
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Indo Tambangraya Megah - Indonesia
- Eastern Coal Council - USA
- OPG Power Generation Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Singapore Mercantile Exchange
- Ministry of Finance - Indonesia
- Simpson Spence & Young - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement PLC, Thailand
- Riau Bara Harum - Indonesia
- Parry Sugars Refinery, India
- Iligan Light & Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- India Bulls Power Limited - India
- Central Electricity Authority - India
- Bukit Makmur.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Kepco SPC Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Power Finance Corporation Ltd., India
- Attock Cement Pakistan Limited
- Energy Development Corp, Philippines
- Thai Mozambique Logistica
- Jorong Barutama Greston.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- Indian Energy Exchange, India
- Ministry of Transport, Egypt
- The University of Queensland
- Planning Commission, India
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- Antam Resourcindo - Indonesia
- SMC Global Power, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Sakthi Sugars Limited - India
- Xindia Steels Limited - India
- Borneo Indobara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Uttam Galva Steels Limited - India
- Kumho Petrochemical, South Korea
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Chamber of Mines of South Africa
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Commonwealth Bank - Australia
- Grasim Industreis Ltd - India
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Australian Commodity Traders Exchange
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- Timah Investasi Mineral - Indoneisa
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Bhoruka Overseas - Indonesia
- Coastal Gujarat Power Limited - India
- Kobexindo Tractors - Indoneisa
- Anglo American - United Kingdom
- Gujarat Sidhee Cement - India
- Agrawal Coal Company - India
- CNBM International Corporation - China
- PowerSource Philippines DevCo
- Sree Jayajothi Cements Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- VISA Power Limited - India
- Kaltim Prima Coal - Indonesia
- Formosa Plastics Group - Taiwan
- Orica Australia Pty. Ltd.
- Kapuas Tunggal Persada - Indonesia
- The Treasury - Australian Government
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- Sindya Power Generating Company Private Ltd
- Renaissance Capital - South Africa
- Bangladesh Power Developement Board
- Cigading International Bulk Terminal - Indonesia
- Bharathi Cement Corporation - India
- Georgia Ports Authority, United States
- Independent Power Producers Association of India
- Mercator Lines Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- The State Trading Corporation of India Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- Thiess Contractors Indonesia
- Global Green Power PLC Corporation, Philippines
- McConnell Dowell - Australia
- Price Waterhouse Coopers - Russia
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- Aditya Birla Group - India
- Star Paper Mills Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bayan Resources Tbk. - Indonesia
- Coal and Oil Company - UAE
- Madhucon Powers Ltd - India
- Parliament of New Zealand
- AsiaOL BioFuels Corp., Philippines
- Binh Thuan Hamico - Vietnam
- Marubeni Corporation - India
- Meenaskhi Energy Private Limited - India
- Electricity Authority, New Zealand
- Savvy Resources Ltd - HongKong
- SMG Consultants - Indonesia
- Globalindo Alam Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Deloitte Consulting - India
- Energy Link Ltd, New Zealand
- Petron Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- Mintek Dendrill Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Central Java Power - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Bulk Trading Sa - Switzerland
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- Economic Council, Georgia
- PetroVietnam Power Coal Import and Supply Company
- Holcim Trading Pte Ltd - Singapore
- Indika Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Global Business Power Corporation, Philippines
- Malabar Cements Ltd - India
- Interocean Group of Companies - India
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