Aussie Coal Advocates Solicit Global Banks; Oil-Price Drop Hurts Tar-Sands Prospects; More Coverage of IEEFA Port Report
AUSTRALIAN POLITICAL LEADERS ARE STRUGGLING TO MAINTAIN INTERNATIONAL BANKING SUPPORT FOR FURTHER INFRASTRUCTURE DEVELOPMENT of the Queensland coal industry.
In details published this morning in a column by Richard Gluyas, a correspondent for the Australian Business Review, the newspaper details how politicians “have been doing their best to turn the tide of negativity,” as they travel abroad to call on Deutsche Bank, UBS, Bank of American Merrill Lynch, and KfW, the German development bank. Excerpts:
- “The deluge of emails received since last week’s item on the funding challenges faced by Indian company Adani Enterprises’s $7.2 billion coal project in Queensland have been uniformly bleak about the prospect of funding the ambitious project.”
- “Any realistic assessment would conclude that the eight coal projects planned for the Galilee Basin — the world’s biggest greenfield coal resource — are high risk, with the potential for creating stranded assets.”
- “The core problem is that the projects, conceived in 2009-11 at a time of record coal prices, have now moved into the planning phase after a 50-60 per cent collapse in thermal and coking coal prices since 2011.”
The column quotes IEEFA’s Tim Buckley at length, saying “it’s the sheer magnitude of financial capital and infrastructure work required that makes the projects high risk,” and citing IEEFA’s recent report on the topic.
THE SHARP PLUNGE IN OIL PRICES ISN’T HELPING PROSPECTS FOR DEVELOPMENT OF CANADA’S TAR SANDS, Bloomberg News reports today.
Jeremy van Loon and Rebecca Pentry cite research by, among others, Patricia Mohr, an economist at Bank of Nova Scotia in Toronto.
Excerpts from the article:
- “Profitability for all but the lowest-cost oil sands producers that use drilling and steam to coax bitumen from the ground will be squeezed.”
- “Producers have struggled to get growing production to coastal markets, with projects such as TransCanada Corp. (TRP)’s Keystone XL and Enbridge Inc.’s Northern Gateway stalled.”
- “Labor shortages in Alberta and the high costs to move heavy equipment to remote oil-sands sites add to the challenges.”
IEEFA’S NOV. 19 REPORT ON EXCESS COAL-EXPORT CAPACITY HAS CONTINUED TO DRAW ATTENTION. WWL-TV, New Orleans’ biggest television station, did a segment last week on it under the headline “New Report Questions Proposed Plaquemines Coal Facility.”
“I can’t see a company wanting to invest in a facility if they don’t have the customers to either import or export the product,” Plaquemines Parish President Billy Nungesser tells WWL’s Tania Dall.
Cascadia Weekly, published in Bellingham, Wash., has a lengthy piece quoting IEEFA’s Tom Sanzillo in an appearance before a group that included the mayor of Bellingham: “If you want a partner for economic growth in your counties and your cities, try something other than coal.”
And The Olympian over the weekend editorialized against proposed coal-port expansion in the Northwest.
Here’s the New Orleans clip. Here’s the Cascadia Weekly item. Here’s the Olympian editorial.
— Karl Cates
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Twitter @ieefa_institute
