Skip to main content

Global coal production revisited - again

On Friday, 06 May, 2011, Professor David Summers posted on OilPrice.com an oddly emotional article,  A Look at the Serious Energy Shortages in India and Pakistan.

Dr. Summers correctly points out that severe shortages of coal supply in India and Pakistan will not be quenched by imports from Australia, because China will outcompete anyone for the same coal imports.

From our analysis it follows that China's coal production will be difficult or impossible to maintain at the current high level. And China's coal demand is skyrocketing despite attempts to reign in coal burning by their most inefficient industrial enterprises.

Dr. Summers then goes on to say that the folks like Tad Patzek and Dave Rutledge have it wrong anyway, when they talk about the global peak of coal production and inability to satisfy demand that follows.  

Well, here we are: Too much demand worldwide, and not enough supply. The coal price goes up, way up, and still not enough supply.  How does one call this phenomenon?  Inattention, according to Dr. Summers.  The global peak of coal production, according to Patzek and Croft.

The multi-Hubbert cycle analysis is the best available estimator of future performance of the past and current coal mines around the globe, and their minor extensions.  The verdict is in: The year 2011 is the year of global peak of coal production.

The new coal mines haven't materialized for a variety of reasons, environmental, technical, logistic and economical. In the meantime, many of the current mines continue to decline.  Such is the ice-cold logic of summation of uncorrelated random variables.

P.S. On 5/25/2011, the New York Times reported on electricity production cutbacks in China.  Dr. Croft commented as follows:
Steam coal from Newcastle, Australia, was US$120.66 per metric ton ($109.46 per short ton) last week. South African prices are just as high in spite of longer haul distance to Asia. Compare that to $78.85 per short ton for Central Appalachian coal and you can see the beginnings of an Asian coal crisis. If you search 'China electricity shortage' on Google news, you see a lot of evidence that we were right about 2011. Shaanxi, Shanxi and Hubei are among the provinces with electricity shortages and they are three of the most important coal-producing provinces. I predict that China will suck up world coal exports, India will be caught short in a big way and the coal resources of Indonesia will be plundered as rapidly as possible with scant regard for the environment or local populations. As they say in the UK tabloid press, remember where you saw it first!
P.S.P.S. 6/2/2011.  I am back in Poland for a short visit.  The first news I see in a newspaper is this:  A Polish coal concern has been valued at 24 billion PLN ($9 billion) at the initial stock offering.  This concern is the largest exporter of coking coal in the world.  The price of coking coal went up 40% this year, to the current $320 per metric ton.

Comments

  1. Data from the EIA regarding world coal consumption in QBtu indicate that the peak was actually in 2009 at 133.21 QBtu. This was at the end of a three year plateau in which consumption varied little. Consumption dropped to 130.26 QBtu in 2010 after the 2009 peak.

    In 1991 and 1998 world coal consumption declines were followed by increases, so it is possible that new consumption records can be set, but unless Australian production recovers rapidly, it is hard to see 2011 consumption exceeding that of 2009. For the sake of our planet, we can only hope that consumption continues to decline at an ever more rapid rate.

    ReplyDelete
  2. Love your blog!

    Any comment on the latest stats from BP? Coal use up by 7.6%. Although prices are high, production rolls on.

    Keep up the great work!

    ReplyDelete
  3. While for some an ideal world would see no reliance on thermal coal (steam coal) to produce electricity, coal statistics would suggest the commodity isn't going anywhere. Coal reports show if we have to live with it, we may as well reduce the impact of coal and CCS seems to be the best solution found to date.
    Cherry of www.coalportal.com

    ReplyDelete

Post a Comment

I would like to learn what you are thinking about my posts and encourage you to share

Popular posts from this blog

Ascent of the Angry and Stupid

Scientifically speaking,  stupid  people harm themselves while also harming others. In addition, stupid people are irrational and erratic, and are very dangerous to others. After discussing the destructive role of the stupid in any society whatsoever, I will focus on the delicate interplay of actions of intelligent and helpless people, who in balance make or break a functioning democracy.  Unless things change fast in the US, we can kiss our democracy goodbye for decades. If you want to see how a virulent ascent of the stupid looks up close, and what implications it has for our fight against social injustice and climate change, please watch the brilliant " Don't Look Up " movie. Unvaccinated people demonstrating in Los Angeles. There are tens of millions of the raving mad and/or angry, stupid people in the US and other developed countries. Source: New York Times , 12/25/2021. I overlapped at UC Berkeley with Professor Carlo M. Cipolla for a decade, until his death in t

Confessions of a Petroleum Engineer and Ecologist

I just attended an SPE workshop, "Oil and Gas Technology for a Net-Zero World – Defining Our Grand Challenges for the Next Decade."  Of the 60 people in the audience, I knew 1/3, some very well.  It makes sense, because I have been an SPE member for 40 years, and a Distinguished Member for 20 years.  Last year, I received an SPE EOR/IOR Pioneer Award for my work at Shell and UC Berkeley on the thermal enhanced oil recovery processes that involved foams, and their upscaling to field operations. This was nice, because Shell recognized me as one of their best reservoir engineers, and in 1985 I received an internal Shell Recognition Award for the same work. But I am not a mere oil & gas reservoir engineer.  First and foremost, I am a chemical engineer and physicist, who has thought rigorously about the sustainability of human civilization , ecology and thermodynamics of industrial agriculture and large biofuel systems, as well as about the overall gross and net primary produc

Net Ecosystem Productivity is Zero on Planet Earth

In the last bog , I told you how the law of mass conservation governs the large-scale behavior of Earth's households - ecosystems - that must recycle all mass on average and export only low quality heat into the cold universe.  Now, I will give you a few useful definitions of cyclic processes, sustainability, and ecosystem productivity. Let me start from stating the obvious:  We live in a spaceship we cannot leave, a gorgeous blue, white and green planet Earth that takes us for a spin around her star, the Sun, each year. But this statement is imprecise. We really live on a vanishingly thin skin of the Earth, her ecosphere .   Think of this skin as of a thin delicate membrane, teaming with life and beauty, but incredibly fragile. We trample on this membrane and poison it.  Then we act surprised when it brakes and shrivels. Practically all life on the Earth exists between two concentric spheres defined by the mean Earth surface at the radial distance from the Earth's