Coal news and updates

Outlook dour for Aussie coal: Citi

Citi thinks thermal coal prices will have to recover from about $US70 a tonne to $US100 a tonne to restart investment in new Australian mines, Fairfax Media reports.

According to the news service, the investment bank said the downturn in the sector would not be reversed for at least three to four years as China moved on air quality measures and despite anticipated coal-fired generation investment in India.

"Increasing regulations and the establishment of carbon markets promise to limit the attractiveness of coal" in China, the bank said in a note to clients, Fairfax reports. "Moreover, the country is aggressively pursuing an 'everything but coal' development plan for the power sector, with rapid growth in capacity for alternative energy sources."
Citi said many of Australia's uncommitted coal projects, believed to be worth up to $70 billion, would only be economic "if there were to be the very favourable combination of higher prices, cost containment and a lower Australian dollar", the news service reports.

Source: The Australian