Coal news and updates

The US thermal coal market will shrink to about 500 million to 550 million st/year from roughly 800 million in 2015, Murray Energy CEO Bob Murray said.

Murray, speaking at the 37th annual Virginia Coal and Energy Alliance conference in Kingsport, Tennessee, said in a wide-ranging keynote speech that he also met last Monday with presumptive Republican nominee Donald Trump in the candidate’s New York office to discuss energy policy.

“I said we need to get these 20 permits for LNG ports, get that [natural] gas out of the country, then he said, “What’s LNG?” said Murray. “He’ll get there. He’ll surround himself with people that know the industry. But he’s all we’ve got, he’s the horse to ride, and he’s got his head on right.”

With regard to the current coal market, Murray said he believes the market remains oversupplied and further turmoil is likely, given that producers aren’t doing more to shut down mines.

Murray said he thinks 2017 will be worse than 2016, and “I don’t know about 2018 because I can’t see that far.”

Murray said he thinks the Powder River Basin “is going to be hit very hard” by market dynamics, partly because he doesn’t believe the economics of moving low-heat coal with lots of moisture great distances across the country by railroad. “It’s [an artificial market] created by the Clean Air Act of 1990,” Murray said.

Murray said he believes Central Appalachian coal production will drop to 60 million st from 200 million st as recently as 2011, that both Northern Appalachia and Illinois Basin will show declines, and the Western coal market has been “destroyed” by West Coast states moving away from coal-fired power. Murray owns mines in CAPP, NAPP, the Illinois Basin and Utah.

The outspoken CEO said he expects to mine 60 million st this year, down from early projections of roughly 90 million st, and that he’s working Sundays to keep his company out of bankruptcy.

“Our electricity power generators cannot dispatch their power plants and we cannot sell our coal,” said Murray.

Murray said bankruptcies strip away employer liabilities and push coal prices lower, “and we all get sucked into the bankruptcy sewer.” But because producers who file for bankruptcy aren’t shutting down mines, “these zombie mines, I call them, still exist,” he said. “They are being unloaded of all their obligations and makes it so none of us can stay out of bankruptcy.”

Murray said he’s hopeful several of his lawsuits against the Environmental Protection Agency and other government agencies will be successful, but that he plans to be around whatever the future holds.

“I’ll be 100 million st, I can be one-sixth of the coal industry,” said Murray. “I have low-cost mines with 17 longwalls, and good reserves, so my plan is to be in there, with one-sixth of what’s left.”

Source:hellenicshippingnews