Coal in Australia

- September 13th, 2013

Australia was the fifth-largest coal producer in the world in 2012, according to the World Coal Association.

Australia was the fifth-largest coal producer in the world in 2012, according to the World Coal Association. The country produced 421 million tonnes of coal last year – 301 million tonnes of which was exported.

Coal Deposits
Coal can be found in all of Australia's states and the Northern Territory, according to Geoscience Australia. The nation contains about 7 percent of the world's economically recoverable black coal, putting it in fifth place behind the U.S, Russia, China and India.

Significant deposits can be found near the eastern and western edge of the Sydney-Gunnedah Basin in New South Wales.

In Queensland, major coking coal mines are the Goonyella and Kestrel mines located in the Bowen Basin. Thermal coal mining takes place at the Newlands and Rolleston mines. Other significant thermal coal mines are located in the Surat and Moreton Basins such as the Wilkie Creek and New Acland mines.

Major Australian Coal Mining Companies

Peabody Energy (NYSE:BTU)
This coal mining company owns interest in 28 active coal mines in Australia. With mining operations in Queensland and New South Wales, Peabody sold 33 million tonnes of coal to steel producers in Japan, Europe, Taiwan, India and South America last year. The coal mined by Peabody also was used for electricity generation in Australia and Asia, according to the company's website.

One of Peabody's mines in New South Wales is the Metropolitan mine – an underground mine that produced 2.1 million tonnes of saleable coal in 2012. The Wambo mine complex, also in New South Wales, includes the Wambo Open-Cut mine and the North Wambo Underground mine, which produced 3 million tonnes and 3.5 million tonnes of coal, respectively, last year.

In Queensland, Peabody operates the Burton mine, the Coppabella mine and the Eaglefield mine, among others. The Burton mine produced 0.9 million tonnes of coal last year, the Coppabella produced 2.6 million tonnes and the Eaglefield mine produced 0.9 million tonnes of coal.

Peabody expects to produce as much as 36 million tonnes of Australian coal this year.

BHP Billiton (NYSE:BHP)
BHP operates in more than 100 locations around the globe, including operating a number of coal mines in Australia. The company's assets include the BHP Billiton Mitsubishi Alliance, which has seven mines in the Bowen Basin: Goonyella Riverside, Broadmeadow, Peak Downs, Saraji, Norwich Park , Gregory Crinum and Blackwater.

BHP also operates three underground coal mines in the southern coalfield in New South Wales: the Appin, West Cliff and Dendrobium mines. The Appin mine, for instance, has a capacity of 3.5 million tonnes per annum of metallurgical coal.

BHP increased its coal production 13 percent during the 2013 financial year – hitting 38 million tonnes. It's coal operations in Queensland increased 19 percent, as well, thanks to its operations at the Peak Downs and South Walker Creek mines in the Bowen Basin. Another mine in the Bowen Basin – the Broadmeadow – saw an increase in productivity by 0.4 million tonnes during the fiscal year.

Glencore Xstrata PLC (LON:GLEN)
Glencore has coal mining operations in South America and Africa, but the majority of its coal projects are located in Australia. The Newlands complex, which is also in the Bowen Basin in Queensland, produces export steaming coal and coking coal. The complex includes multiple mines like the Collinsville open-cut mine and the Abbot Point mine, and it produces 11 million tonnes of coal every year. Xstrata owns 55 percent of the project.

The company also operates in the Bulga complex in New South Wales, of which Xstrata has 68.25 percent ownership. This complex is located less than 10 miles southwest of Singleton and produces about 16 million tonnes of semi soft coking coal and thermal coal annually.

Australian Coal Exports
Australia is the world's leading coal exporter, with black coal exports increasing by more than 50 percent in the last decade, according to the Australian Coal Association.

Nearly 40 percent, or 115.3 million tonnes, of the coal exported from Australia went to Japan last fiscal year, the ACA said. China is the second largest market for Australian Coal. China received 42.4 million tonnes of coal in 2009-2010. Korea received 40.7 million tonnes and India received 31.92 million tonnes of Australian coal.

China and India are expected to be the main consumers of Australian coal in the next decade, according to the ACA, due to increased demands in energy and manufacturing.

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