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UMWA Wants More Coronavirus Protections for Coal Miners

The United Mine Workers of America is asking federal regulators to set uniform, enforceable guidelines to help protect coal miners from contracting COVID-19. UMWA President Cecil Roberts wrote to the Mine Safety and Health Administration requesting the agency issue a safeguard or emergency standard that would require coal mine operators to take actions to protect miners from the coronavirus.”

Union officials are requesting operators obtain N-95 respirators, set procedures for disinfecting equipment between shifts, provide extra personal protective equipment and create disinfectant strategies for bathhouses and other communal gathering places. While these are certainly difficult times for all workers, it is especially challenging for workers who are unable to work from home and have valid concerns about their health and safety and that of their loved ones. Our miners work in close proximity to one another from the time they arrive at the mine site. They get dressed, travel down the elevator together, ride in the same man trip, work in confined spaces, breathe the same air, operate the same equipment, and use the same shower facilities.”

UMWA spokesperson Phil Smith said while some mines are voluntarily taking precautions to protect workers, the efforts are not uniform across the industry. He said many coal miners suffer from impaired lung function due to exposure to coal and silica dust and may be more vulnerable to the coronavirus. In addition, he said many mines and miners are located in rural communities, which have less access to medical care and have faced high levels of hospital closures over the past decade. He said “There’s no consistency out there. Even among the same companies and mines operated by the same companies. There’s certainly no consistency with mines where we do not represent the workers.”

If MSHA issues an “emergency standard” requiring mine operators to implement coronavirus precautionary measures, mine inspectors could issue citations if operators are found out of compliance.

Source : Strategic Research Institute
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MC Mining Limited Update on Lockdown in South Africa and Suspension of Coal Production

MC Mining Limited announced that “Our priority is the health and safety of our employees. The guidance and advice we are providing employees, follows World Health Organisation guidelines and is supplemented by direction provided by the South African Government. The Executive Committee regularly review and update our advice to employees and monitor the business continuity measures to ensure managerial oversight is effective and properly coordinated.”

The South African Government issued a directive on 23 March 2020 requiring a 21-day national lockdown, effective midnight Thursday 26 March 2020 to midnight Thursday 16 April 2020, to contain the spread of the coronavirus in the country. The Directive impacts operations at the Company’s Uitkomst Colliery, the Makhado, Vele and Greater Soutpansberg Projects as well as its corporate office. In line with measures detailed in the Directive, the Uitkomst Colliery will be placed on care and maintenance during the Lockdown period. The scaled back operations will be monitored and managed according to procedures enacted to protect the health and safety of all of the Company’s people, which remains the MC Mining’s overriding priority. These procedures cover employee communication and training, hygiene response, security controls, health monitoring, resilience and contingency plans.”

It added “It is worth noting that the Uitkomst Colliery is a mechanised underground operation with limited human interaction. Upon completion of the Lockdown period, it will be possible to ramp-up to steady state production levels within a relatively short timeframe. However, given the continued uncertainty around the outlook for control of the coronavirus in South Africa, FY2020 production guidance is suspended until the Company is in a better position to quantify the full impact of the lockdown.”

Source : Strategic Research Institute
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South African Mines to Continue Operation During COVID-19 Lockdown

On Wednesday, South Africa’s Minister of Mines and Energy, Gwede Mantashe announced that the country’s mining sector will continue to process platinum group metals despite the country’s 21-day coronavirus lockdown. Mr Mantashe said “Production in gold, chrome, manganese and other sectors will be scaled down, while processing of surface materials in the PGM sectors will continue, this will allow smelters, which cannot be switched on and off abruptly, to remain operational.”

This announcement comes after South Africa’s Minerals Council appealed to the government to permit smelters and refiners t continue operating during the national lockdown. The council also said that “services to staff residences would continue. In its recommendations document the Minerals Council had asked for workers’ hostels near mine sites to remain open to avoid the risk of virus transmission if they travel back to their homes for the lockdown.

South Africa’s power company, Eskom earlier said miners and transporters of the thermal coal it needs for its power stations will continue to operate during the lockdown. Production and distribution of petroleum products would also continue, Mantashe.

Source : Strategic Research Institute
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Vale Sends Brazilian Workers Home from Mozambique

The Brazilian mining company Vale, which operates Mozambique's largest coal mine, at Moatize, in the western province of Tete, has decided to send its Brazilian staff and their families, a total of 250 people, back to Brazil, because of the threat posed by the Covid-19 pandemic. A Vale spokesperson told AIM that it has hired a plane for this task, since most regular flights are suspended.

The company said this was part of measures taken to protect its workers, its business and the communities living around its operations, in response to the pandemic. A spokesman said "The company stresses that it is in conformity with the health and safety protocols established by the authorities and agencies of each of the countries where it operates, and is monitoring the development of the situation."

Source : Strategic Research Institute
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US Coal Mine Closures & Bankruptcies Likely as Coronavirus Pandemic Spreads

Moody's Investor Services expects further closures and bankruptcies within the US coal industry as demand declines significantly and environmental, social and governance concerns becomes stronger. Moody’s said "The combination of weak power fundamentals, challenging capital market conditions, and increasing concern about ESG will likely push a significant amount of coal capacity into bankruptcies and lead to new closure announcements over the next year or two.”

Moody's expects domestic demand for thermal coal to decline in the near-term as much of the industrial economy is shut down in order to try and slow the coronavirus pandemic and as slower economic activity cuts down US electricity demand. It said "Before the intensification of the coronavirus pandemic in the US, we expected that coal production would fall by15%-20% in the US, to about 550 million st-600 million st. We now expect that the industry conditions will worsen beyond this forecast" as demand weakens for electricity in the commercial and industrial markets.”

Moody’s added "Export thermal markets will continue to fall in 2020, rather than helping rescue domestic thermal coal producers from weakening domestic demand like in 2017 and 2018. While some producers still have contracts established during stronger market conditions, and cash costs vary significantly for each mining operation, coal pricing in Europe will not support a continuation of US exports at 2019 levels, which were themselves down 20% from 2018 levels."

Source : Strategic Research Institute
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Singareni Coal Miners Call for Closure of Mines to Curb COVID-19 Spreads

The Singareni Coal Mines Karmika Sangh affiliated to Bharatiya Mazdoor Sangh has urged Union Minister of Coal and Mines Prahlad Joshi to instruct the Telangana government to announce lockdown for the coal miners of Singareni Collieries Company Limited to help the check the spread of coronavirus COVID-19. Singareni Coal Mines Karmika Sangh State president Kengerla Mallaiah complained that the State government in spite of announcing lockdown till April 15 had forced the Singareni coal miners to work in odd working conditions in groups in various mines and extract the coal. He wrote “Incidentally, there cannot be social distancing in the coal mining activities and miners were forced to work in groups for the excavation of coal in the underground mines. In every shift more than 500 miners work in groups in the mines and there was every possibility of spread of the virus in the mines. Coal miners cannot prevent spread of virus by wearing masks, washing hands with soap or sanitisers etc. Coal miners and their family members were worried lot over the possible spread of virus following the working during the lockdown period to break the chain of virus.”

He appealed to the Union Minister to declare closure of all the mines, including Singareni, to check the spread of virus and force the miners to remain indoors.

Singareni Collieries Company Limited is working in three shifts to produce enough coal. SCCL said that the coal miners and staff were taking enough precautions while continuing with their work categorised under emergency services.

Source : Strategic Research Institute
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Yancoal Increases Stake in Moolarben coal mine in New South Wales

Yancoal Australia has entered into an agreement to increase its stake in the Moolarben coal mine in New South Wales. Under a binding agreement, Yancoal will acquire a 10% stake from joint venture partner Sojitz Corporation for AUD 300 million. The consideration is payable in four instalments. The first AUD 50 million will be paid this week, followed by another AUD 50 million by the end of June. The third instalment of AUD 100 million is due at the end of the year, with the remaining AUD 100 million due in March 2021. Yancoal will fund the acquisition from cash holdings.

Yancoal said "Yancoal views the proposed acquisition as an attractive opportunity to increase its participating interest in the Moolarben JV from 85% to 95%. The immediate benefit will be the increase in attributable revenue, which Yancoal will consolidate into its financial results from this low cost, tier one asset; and with potential for the Moolarben JV to increase its production profile in the future, subject to ongoing work with external stakeholders."

A consortium of Korean companies holds the remaining 5% of the JV.

Moolarben produced 20.5 million tonnes of coal last year.

Source : Strategic Research Institute
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Coal India to Miss 2019-20 Target

Coal India’s production in the ongoing fiscal is likely to fall short of the target even as the public sector miner has stepped up production to mitigate the challenges of excessive rain and low demand. CIL has produced 517.78 million tonnes of coal in the first 11 months of 2019-20. It had to produce 142.22 million tonnes in March at an average of over 4 million tonnes per day to meet the target. The company has averaged around 2.56 million tonnes per day in March. According to sources, till March 28, coal production was around 591 million tonnes and the miner is likely to produce around 12 million tonnes, taking the production for the fiscal to around 602-603 million tonnes, which is less than 607 million tonnes produced last year.

Coal India has set a target of producing 750 million tonnes in 2020-21 and reach a billion-tonne mark by 2023-24. Although coal mining has been declared as an essential service during the lockdown period, production will depend on the economic activity, especially of the non-power sector.

Source : Strategic Research Institute
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Alliance Resource Suspends Illinois Basin Coal Mines over COVID-19 Pandemic

Alliance Resource Partners LP announced a series of actions in response to the rapidly evolving impact of the COVID-19 pandemic. The unprecedented decision by world leaders to lockdown the global economy to combat the deadly virus has crushed demand for energy. The price war initiated by Saudi Arabia and Russia has lowered oil prices even more. All Americans are having to adjust to a way of life none of us could have imagined two months ago. Given the essential, life-sustaining nature of its business, ARLP continued to operate during the 2020 first quarter. For the past six weeks, however, we have been working at reduced levels while evaluating the needs of our customers amid the disruptions caused by the pandemic. It appears these disruptions will continue for the immediate near future and in light of the ongoing uncertainty surrounding the COVID-19 pandemic, ARLP is taking the following actions:

ARLP is temporarily ceasing coal production at all of its Illinois Basin mines. While this temporary idling is currently scheduled to last through April 15, 2020, the actual return to production may be accelerated or extended based upon the business needs of our customers. As the year progresses, coal production at all of our operations will be further modified to match existing sales commitments of approximately 28 million tons for 2020.

To mitigate the reduced revenues from lower coal sales volumes and the impact of depressed commodity prices on our Minerals segment, ARLP will optimize cash flows through numerous initiatives to reduce costs, expenses, working capital and capital expenditures.

ARLP is a diversified natural resource company that generates income from coal production and oil & gas mineral interests located in strategic producing regions across the United States. ARLP currently produces coal from seven mining complexes it operates in Illinois, Indiana, Kentucky, Maryland and West Virginia. ARLP also operates a coal loading terminal on the Ohio River at Mount Vernon, Indiana. ARLP markets its coal production to major domestic and international utilities and industrial users and is currently the second largest coal producer in the eastern United States.

Source : Strategic Research Institute
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Coronado Global Resources Idles US Coal Mines

Coronado Global Resources Idles US Coal Mines
Coronado Global Resources Inc announces that, in response to the COVID-19 induced economic downturn in Europe, Brazil and the United States, it is temporarily idling its US operations effective immediately. The Company will continue shipments to these regions from existing inventories of approximately 750,000 tonnes, which we expect will meet all current customer contractual commitments as well as deliver on potential sales opportunities. In Australia, the Curragh mine will continue to operate to accommodate metallurgical coal export requirements of its key customers in India and the Asia Pacific. Curragh also supplies coal under a long-term contract to the Stanwell Power Station, a Queensland government owned entity.

Coronado will furlough all US hourly employees. Salaried employees in the US will continue to maintain the integrity of each operation for rapid resumption of operations, comply with all regulatory obligations, handle shipments and day-to-day administrative and management responsibilities. Coronado will continue the Company-paid portion of heath care insurance premiums for all furloughed employees at this time.

The temporary halt to production at the U.S. mines may impact the previously announced saleable production guidance for fiscal year 2020 of 19.7 to 20.2 Mt, the extent of which cannot be estimated at this time due to the uncertain market conditions. Cost per tonne sold will likely be higher than forecast resulting from the anticipated lower production volumes in the U.S. Curragh, which accounts for 65% of the Company’s production and earnings, is expected to continue to operate to service its customers.

Source : Strategic Research Institute
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Colombia Coal Union Sintracarbon Suspends Strike at Cerrejon

Reuters reported that the biggest union at the Cerrejon coal mine in Colombia pulled back from launching a previously approved strike over the weekend and withdrew its demands regarding pay raises and other benefits. The decision by union Sintracarbon extends previously agreed benefits with the company until June 30 this year. An initial 20 days of new negotiations will begin in May.

The union had until midnight on Saturday to declare the start of a strike at the northern mine, which members had voted to support on March 16.

If there is no agreement at the new talks, the union must once again call on members to vote between strike action or arbitration.

Sintracarbon had accused Cerrejon of looking to cut costs by freezing, reducing and eliminating employee benefits.

Source : Strategic Research Institute
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Donkin Coal Mine in Cape Breton Closing Permanently

Kameron Collieries is closing Donkin Mine, leaving an estimated 150 people without a job. Kameron Collieries spokesperson Mr Paul McEachern confirmed “It will cease in production of coal. Mine will be maintained by a handful of staff. It’s not for sale. The decision to cease operations was only due to the adverse geologic conditions in the mine. “The geology is just very, very challenging. It’s not a decision they wanted and it’s not a decision they took lightly and it’s a decision they took a long, hard look at.”

Mr McEachern said the mine will not be sealed but maintained by the small staff to ventilate and keep the facility dewatered.

Although he didn’t have an exact total of staff employed there he described numbers as north of 100. He said “There will be a small staff kept on maintaining the basics of the mine, to ensure water is kept out of the mine, ventilation is kept operating and equipment on site is maintained.”

He added “I can definitively say though; the mine will not be producing coal. It’s basically in a period of suspended animation. There’s no suggestion at this point of a return to production.”

Donkin Mine timeline

In 2014 and early 2015, Cline Group LLC gained full control of the Donkin Mine after purchasing a 75 per cent majority stake in the operation from Glencore Xstrata PLC and 25 per cent interest from Morien Resources Corp.

Donkin Mine celebrated its first anniversary of coal production in February 2017.

As of the fall of 2019, Donkin Mine had an estimated 150 employees.

As of February 2020, there had been 12 roof falls reported at Donkin Mine since 2017.
Source : Strategic Research Institute
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Corsa Coal Announces Results for Fourth Quarter and Full Year 2019

Premium quality metallurgical coal producer Corsa Coal Corp has reported financial results for the three months and full year ended December 31, 2019. Net and comprehensive loss from continuing operations for the year ended December 31, 2019 was USD 0.5 million compared to income of USD 5.9 million for the year ended December 31, 2018. Total revenue from continuing operations for year ended December 31, 2019 was USD 230.9 million, compared to USD 265.9 million for the year ended December 31, 2018.

Low volatile metallurgical coal sales tons, comprised of "Company Produced" tons and "Value Added Services" purchased coal tons, were 440,086 in the fourth quarter 2019 compared to 372,313 in the fourth quarter 2018 and 1,551,882 for the full year 2019 compared to 1,385,229 for the full year 2018. In the fourth quarter 2019, Corsa sold a total of 68,879 "Sales and Trading" tons, which are treated as pass-through from a profitability perspective, compared to 94,212 tons in the fourth quarter 2018 and 281,471 for the full year 2019 compared to 486,876 for the full year 2018.

Source : Strategic Research Institute
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Montana Approves Spring Creek Mine Expansion

Montana Department of Environmental Quality has approved a 977-acre expansion of the state's largest coal mine Spring Creek Mine, located near the Wyoming border, extending the life of the mine by four years to 2031.

Officials said that the expansion includes about 72 million tons of coal and is expected to produce up to $59.5 million in taxes for the state, and employ up to 340 workers.

The decision also includes more than $105,000 for 615 acres of lost habitat for endangered sage grouse.

Source : Strategic Research Institute
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SA Minister Mr Mantashe Visits Impunzi Colliery, Matla Coal and Kriel Colliery

South Africa’s Mineral Resources and Energy Minister Mr Gwede Mantashe visited three mines to monitor compliance with the country's 21-day national lockdown. The mines visited are Glencore's Impunzi Colliery, Exxaro's Matla Coal and Seriti's Kriel Colliery, which all supply coal to Eskom. The Minister used the visits to the three collieries in Mpumalanga to assess the implementation of the directive and guiding principles issued by the department to all mines on how to manage risks associated with COVID-19 at an operational level. He said "The primary objective of our interventions is to ensure that as many people as possible are protected from COVID-19 and that the sector is able to bounce back from this challenge when the lockdown is lifted. The mines are not at the same level in terms of their state of readiness to deal with the pandemic. We are encouraging all mines to work together - employers and labor unions - to share best practice and ensure their systems are complementary, in order to proactively manage risks beyond each mine.”

The Department of Mineral Resources and Energy said there are three confirmed cases of COVID-19 in the mining and energy sectors, one in Gauteng, Mpumalanga and the Western Cape, respectively.

All mines are required to, among others, conduct a risk-based assessment covering all workings at mines, reduce numbers of employees transported on common transport per shift, and where applicable, reduce the number of shifts per day.

Source : Strategic Research Institute
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Bowen Coking Coal Lodges Mining Lease Application for Isaac River

Bowen Coking Coal has lodged a Mining Lease Application for its Isaac River Coking Coal Project in Queensland. The MLA was lodged with the Queensland Government's Department of Natural Resources, Mines & Energy and provides an important step forward in converting the project to a producing asset. Along with the MLA an Initial Development Plan was also submitted which proposes using off-site infrastructure for washing the extracted coal. An Environmental Authority Application is also expected to be lodged within the next quarter. The application will be lodged by specialist environmental consultants, which BCB has been working with to conduct all necessary studies for the application since Q1 2019.

BCB's Isaac River Coking Coal Project covers 14 square kilometres and is located in Central Queensland, approximately 130 kilometres southwest of Mackay. The total measured and indicated resource sits at 8.35 million tonnes which is 95 per cent of the total resource. Independent analysis determined the raw coal produced from the project can be washed to achieve primary coking coal which is a significant value upgrade.

Source : Strategic Research Institute
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CIL SECL Produced 1 Million Tonne Coal on March 27

Coal India Ltd’s largest coal producing subsidiary South Eastern Coalfields Ltd became the first coal company to produce one million tonnes of coal in a single day on March 27 amid the country wide lockdown to contain coronavirus. Owing to huge production loss due to deluge in the mines this monsoon, the SECL output in this year is likely to fall short of its previous year's production of 157 million tonnes. But it will able to surpass the 150 million tonne mark and retain the top producer rank among the six Coal India subsidiaries.

SECL contributes almost a fourth of the total production of CIL

Coal mining activity and its transportation has been declared as Essential Service during the lockdown due toCOVID-19 outbreak.

Source : Strategic Research Institute
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Murray Energy Risking Default

Coal supplier Murray Energy Corp said its business has taken a severe hit from “historically bad” coal markets and the coronavirus pandemic, pushing the bankrupt company close to liquidation. According to court papers, Murray Energy Corp has just USD 6 million of cash on hand and the coal miner is concerned it’ll default on its bankruptcy loan if it can’t cease certain retiree health-care payments and may be forced to liquidate if it can’t soon shed the obligations. Company is asking permission to cease retiree health-care payments under its individual employer plan, which would save it USD 200,000 per day

Retirees wouldn’t be harmed because their benefits are backstopped by US government.

Source : Strategic Research Institute
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Coal India Production Falls Short of Target by 9%

State owned Coal India Limited produced 602.14 million tonnes of coal in FY 2019-20, missing the target of 660 million tonnes for the year by 9% despite an all-time high production of 84.36 million tonnes in March 2020, up by 6.5% YoY. Incidentally, by producing 3.85 million tonnes of coal on March 30, CIL has set up a new record for the highest-ever production in a day since its inception. Two of the CIL's subsidiaries Northern Coalfields Ltd and Western Coalfields Ltd surpassed their respective annual production targets of 2019-20, achieving 102 per cent and 103 per cent of their respective targets. While NCL produced 108.05 million tonnes for the fiscal, WCL's output was 57.64 million tonnes. Meanwhile, SECL, another arm of CIL, claimed that it produced 150.55 million tonnes of coal in FY''20.

Coal India's pithead stock has risen to highest ever 74.56 MT offering a comfortable buffer during the ensuing summer months.

Coming back strongly in the last quarter of FY2020, CIL clocked a robust 9.9 per cent production growth compared to same quarter of 2018-19. It produced 213.71 million tonnes of coal during January-March 2020, an increase of 19.26 million tonnes in volume terms compared to 194.45 million tonnes that the company reported for the fourth quarter of FY2019.

The combined coal stock of 119.24 million tonnes at power plants and at pitheads of CIL is highest ever dispelling any notions of coal shortage in the near future.

Source : Strategic Research Institute
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Glencore and Tohoku Settle Thermal Coal Price

S&P Global Platts, citing market sources close to the matter, reported that Japanese power utility Tohoku and Australian coal producer Glencore have agreed on a price of USD 68.75 per tonne FOB for 6,322 kcal/kg GAR thermal coal shipments for delivery from this April to next March. Sources said “The price was lower than their expectations of USD 70 per tonne. The price agreement has shown some signs of weakness on Glencore's side as the price was settled with a smaller premium to the globalCOAL Index as compared to previous years.”

The current globalCOAL Index is said to be USD 69 per tonne FOB for 6,000 kcal/kg NAR Australian coal.

Last year, Tohoku and Glencore finalized the April benchmark at USD 94.75 per tonne FOB.

Tohoku is one of Japan's largest power utilities, consuming roughly about 8 million tonnes coal in 2018,

Glencore is Australia's largest coal producer with Australian thermal coal production at 72.8 million tonnes in 2019, of which 64.2 million tonnes was exported.

Source : Strategic Research Institute
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