Indonesia’s Geo Energy to build new coal infrastructure

Spanish Market: Coal
06/08/24

Indonesian coal producer Geo Energy has signed a $150mn t contract for the construction and development of a 92km coal hauling road and loading jetty in south Sumatra's Jambi province.

The infrastructure will have a capacity of 40mn-50mn t yr with a planned completion in late 2025 or early 2026. Of this, 25mn t will be reserved for Geo Energy's Triaryani (TRA) mine, with the remaining capacity to be leased to neighbouring mines, Geo Energy said.

The development will carried out by state-owned Chinese enterprises First Harbor Consultants and Norinco International. The new infrastructure will be instrumental in TRA aiming to boost production up to 25mn t, Geo Energy said.

Geo Energy produces low-calorific value coal. Its January-March coal sales totalled 1.8mn t, down by 5.3pc from 1.9mn t a year earlier. Its output fell by over 16pc to 1.5mn t over the same period. The output drop was because of seasonal and weather conditions, the company said in May.

It acquired stakes in domestic mining firm Golden Eagle Energy and logistics firm Marga Bara Jaya in July 2023. The deal gives it access to proven and probable coal reserves of more than 300mn t in south Sumatra.

The company said it is on track to achieve sales of 10mn-11mn t this year because it expects higher year-on-year output in the second half of the year. It has obtained a production quota of 10.5mn t for 2024. This includes 8mn t at its SDJ and TBR mines and another 2.5mn t for TRA.

By Andrew Jones

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16/11/24

Cop: Colombia’s climate plan to address fossil fuels

Baku, 16 November (Argus) — Colombia will seek to address the "divisive issue" of "the proliferation of fossil fuels" in its next emissions reduction plan — nationally determined contribution (NDC), environment minister Susanna Muhammad told Argus, adding that it would prompt a "strong debate" in the country. Colombia's president Gustavo Petro seeks to end the country's dependence on fossil fuels, while promoting a transition to clean and renewable energy. "Of course this is a very divisive issue, especially for a country that is looking for a whole economy transition," Muhammad said on the sidelines of the UN Cop 29 climate summit in Baku. "And trying to get the whole of society and the whole of government behind that will be a strong debate." Petro ordered an end to new hydrocarbon exploration and production contracts soon after taking office in August 2022. Petroleum association ACP said that Colombia's crude output will begin declining in 2027 as reserves are insufficient to maintain output amid falling exploratory activity. Petro's ambition to phase out fossil fuels risks sacrificing key revenues for the country. But Muhammad highlighted the need to achieve an ambitious financial goal that supports a just transition in developing economies. "We cannot continue playing with the same financial rules of the game," she said. "What we are seeing at this Cop 29 is that we need solidarity and fairness in the process of financing this transition." "We said in Dubai that we would triple renewables by 2030. The question remains, who is going to triple renewables and for whom?" she said, pointing to the significant gap in renewables expansion between developed and developing economies. Countries at Cop 28 in Dubai, the UAE, last year agreed on a deal that included transitioning away from fossil fuels, tripling renewable energy capacity and doubling annual energy efficiency gains globally by 2030. Muhammad added that the country will be submitting its NDC to the UN climate body the UNFCCC by June next year because it will "go through a very strong consultation process" with different sectors of the economy. Cop parties are expected to publish their next NDCs to the Paris climate agreement — this time for 2035 — in November-February, as part of a cycle that requires countries to "ratchet up" their commitments every five years. "Our main source of emissions is deforestation, agriculture practices, especially cattle ranching," she said, adding that the government is seeking the participation of actors that are at the forefront of the climate crisis. Risky business Talking about the possibility of the US pulling out of the the Paris Agreement and Argentina's delegation exiting negotiations in Baku, she warned that by not putting the people first in the fight against climate change, leaders are risking that other "authoritarian" regimes or "climate deniers" take more power. Brazil's secretary for climate change Ana Toni said today that private companies like policy consistency and that businesses need to look at the countries that are showing climate commitment and consistency in their NDCs. "The climate crisis is irreversible, we need to focus on climate action and implementation," Toni said. By Jacqueline Echevarria Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: ADB, Kazakhstan tie up on early coal retirement

14/11/24

Cop: ADB, Kazakhstan tie up on early coal retirement

Singapore, 14 November (Argus) — The Asian Development Bank (ADB) and Kazakhstan signed an agreement at the UN Cop 29 summit in Baku, Azerbaijan on 13 November to collaborate on the possible early retirement of a coal plant in Kazakhstan. The ADB and Kazakhstan's Ministry of Energy signed the agreement to work on a pilot transaction to reduce the country's greenhouse gas (GHG) emissions, possibly through decommissioning or repurposing a pilot coal plant for renewables or other low-carbon energy technologies. The partners will conduct a feasibility study to identify which plant among a selection of coal-fired power generation, combined heat and power plants, and heat-only boilers could be viable for early retirement. The parties also agreed to analyse the impact that the early decommissioning of the plant could have on Kazakhstan's power and heat supply, and will work together on developing the country's renewable energy generation capacity, and promote regional energy trade. The agreement comes under the ADB's Energy Transition Mechanism, which aims to support the shift away from coal-fired power plants. Kazakhstan is estimated to be the eighth-largest consumer of coal worldwide, with some 25bn t of reserves, said the ADB. About 70pc of the country's electricity is produced from coal, according to the IEA. The country earlier this year projected that it will use 8.6mn t of thermal coal for its heating season this year. State-run Kazakh Invest announced in October that Chinese companies plan to invest billions of dollars in Kazakhstan's coal sector, including the construction of a power plant, even as the country plans to develop new gas fields with a total production capacity of 1bn m³/yr, to switch away from coal for power generation and domestic consumption. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US inflation rises in October to 2.6pc

13/11/24

US inflation rises in October to 2.6pc

Houston, 13 November (Argus) — US inflation ticked higher in October, led by monthly gains in shelter, a reminder that the last lap in the Federal Reserve's marathon to bring inflation to its long-term target remains a challenge. The consumer price index (CPI) accelerated to an annual 2.6pc in October, in line with analysts' forecasts in a survey by Trading Economics, from 2.4pc in September, which was the lowest since February 2021, the Labor Department reported today. Core inflation, which strips out volatile food and energy prices, rose at a 3.3pc rate, unchanged on the month. The energy index contracted by 4.9pc over the 12 months, slowing from a decline of 6.8pc through September. The gasoline index fell by 12.2pc, slowing from a 15.3pc decrease the prior month. The fuel oil index fell by 20.8pc. Federal Reserve policymakers last week cut the target rate by a quarter point, following a half-point cut in September that kicked off an easing cycle from then-23-year highs. Inflation has slowed to near the Fed's 2pc target from highs above 9pc in mid-2022 that proved to be a major impetus behind president-elect Donald Trump's victory at the ballot box on 5 November. The CME's FedWatch tool today gives near-80pc odds of another quarter-point cut in December. "The economy can develop in a way that would cause us to go faster or slower" in adjusting rates lower, Fed chair Jerome Powell told reporters last week after the Fed decision. The food index rose by an annual 2.1pc, slowing from a 2.3pc gain through September. Shelter rose by an annual 4.9pc, unchanged. Transportation services rose by 8.2pc. New vehicles fell by 1.3pc while used vehicle prices fell by 3.4pc. Services less energy services, viewed as core services, rose by 4.8pc. On a monthly basis, CPI rose by 0.2pc in October, a fourth month of such gains after falling by 0.1pc in June. Core inflation rose by 0.3pc for a third month. Shelter accelerated to a 0.4pc monthly gain, accounting for over half of the monthly all-items increase, after a 0.2pc gain. Energy was unchanged in October after falling by 1.9pc in September from the prior month. Food rose by 0.2pc on the month, following a 0.4pc gain. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Coal exit needs new financing, flexibility: Report

12/11/24

Cop: Coal exit needs new financing, flexibility: Report

London, 12 November (Argus) — A successful transition from coal will require new financing mechanisms and flexible repurposing, according to a Coal Transition Commission report published today. Coal consumption is concentrated in emerging market and developing economies (EMDEs), which face different challenges than advanced economies — predominantly strong economic dependence on coal and a substantially younger coal-fired fleet, the report highlighted. Countries with the highest level of difficulty for this transition are Indonesia, Mongolia, China, Vietnam, India and South Africa, the commission noted. The report proposes two major options to reduce emissions from coal-fired units — early retirement and repurposing for flexible usage and retrofitting for the integration of renewable sources. Examples include flexible retrofits to ramp up or down more frequently in a supplementary role to renewable energies, co-firing with lower emission fuels such as biomass and ammonia, or equipping plants with carbon capture, utilisation and storage (CCUS). Financial feasibility Existing scale of financing is insufficient to meet coal power emissions cut targets, requiring new mechanisms for public and private investments that allow for the costs to be covered with reasonable returns, the commission said. The report calls for a regulatory approval to classify investments that reduce emissions from existing coal-fired plants to be considered "transition finance" as financing even for technologies to lower emissions has been difficult to source. For instance, South Africa has faced difficulty obtaining funds from the Just Energy Transition Partnership (JETP) owing to the lack of investible projects . In addition, many southeast Asian plants, particularly in Indonesia and Vietnam, are new and are still subject to unpaid debt . Transition financing for retrofits and flexibility would allow EMDEs to continue using their relatively new fleet while lowering emissions, limiting the financial loss, the report suggested. That said, the bulk of coal-fired units will need to be retired early to stay within the established 1.5°C global temperature rise threshold, but they need financial feasibility for prompt coal exit, the report pointed out. For example, early coal plant retirements were facilitated by private investment in the Philippines and US where the remaining costs of the plants were securitised with lower interest rates. Likewise, Singapore has piloted a transition credit as a mechanism to reduce the economic gap in the early retirements of plants. Coal remains the largest source of electricity worldwide, accounting for 36pc of global generation and 40pc of all energy sector emissions, according to the Paris-based International Energy Agency. By Bonnie Lao Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Lower Mississippi draft restrictions lifted

11/11/24

Lower Mississippi draft restrictions lifted

Houston, 11 November (Argus) — The US Coast Guard (USGC) removed draught restrictions from the lower Mississippi River on 8 November, after several rain washed across much of the Midwestern US. Draft restrictions were completely lifted for north and southbound barges on the lower Mississippi River between Tiptonville, Tennessee, to Tunica, Louisiana. Approximately 2-8 inches of rain were reported in Illinois and Missouri in the last seven days, adding around 14 inches to the lower Mississippi River, according to the National Weather Service (NWS). St Louis, Missiouri was at a high of 11.5 inches above baseline on 11 November, up from a low of -1.5ft on 1 November. The USGC has had draft restrictions in place since August, with the river system receiving a short reprieve in early October after rain from Hurricane Helene poured into the US river system. But low water levels and restrictions returned about two weeks later. Prior to recent precipitation, drafts were restricted to 10-10.5ft for southbound barges and tows could not not be greater than 6-7 barges wide. Northbound barges could not draft greater than 9.5ft, tows could not be more than six barges wide, and only four barges could be loaded. High water levels are expected to remain through November, according to NWS but barge carriers have said that water levels will slip quickly if no additional rain falls along the upper Mississippi River. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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