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英文财经 |
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Profiting From King Coal |
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星期四, 五月 22, 2008 08:48:07 |
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by
Nicholas A. Vardy |
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Viewed as synonymous with dirt, pollution and industrial accidents, coal has an image problem. Yet with coal fueling 40% of the world's electricity, and about 24% of total energy worldwide, coal generates a lot more of the electricity than you probably realize. If you live in the United States, odds are better than 2-to-1 that when you flicked on your lights today, the electricity came from burning coal. And with oil prices soaring, oil reserves dwindling, and most natural gas located in the unreliable hands of Russia and the Middle East, coal is not going to disappear off of the energy scene anytime soon.
In fact, coal may be even reclaiming its role in the spotlight as the fuel of the future. After all, coal is plentiful and readily available from more than 70 countries, including stable countries such as Australia and the United States. And while proven oil reserves will last only 40 years and natural gas perhaps 67 years, the world has enough proven coal reserves to last an estimated 164 years. As the "Saudi Arabia" of coal, the United States boasts more than 25% of worldwide recoverable coal reserves -- approximately 270 billion tons. That's enough coal to sustain itself for the next 250 years. Coal already generates more than 51% of the electricity generated in the United States, with nuclear power and natural gas producing 20% and 16% respectively. Nor is this likely to change. The U.S. power industry burned more coal than ever in 2007. And U.S. coal consumption is expected to jump 73% by 2030.
Profiting From King Coal: New Technology, New Future?
Coal has a long way to go before it overcomes its popular image of dirt and grime. Yet there has been huge progress in minimizing the environmental damage of burning coal. Today's technology can remove 99% of coal's pollutants, rendering coal no more polluting than other fuels.
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Technologies that turn coal into liquids or gases also hold great promise. Coal-to-liquids (CTL) technology, pioneered in Germany and South Africa, can convert the fuel into gasoline, diesel and aviation fuel. Coal liquefaction plants use vast amounts of water and take three to five years to build and to operate. But with oil prices firmly above the break-even price of $40 a barrel, the technology is now economical. No wonder new technologies that substitute coal for oil and natural gas are taking off. A South African company that leads the world in coal-oil production recently had a new version of its aviation fuel, 100% derived from coal approved for worldwide use.
Even a climate-change crusader like Al Gore has thrown his considerable weight behind clean coal as part of the answer to global warming. Australia offers a perfect example of how environmentalism can thrive alongside a commitment to coal. Although it gets more than 80% of its electricity from coal, Australia has turned into a climate-change cheerleader overnight.
The combination of new technologies and soaring coal prices are leading to a renaissance of coal. Drax, Britain's biggest, coal-fired power station, once was on the verge of extinction. Today, it's running at full capacity and generating 7% of Britain's total electricity needs. Coal now supplies 34% of Britain's power, up from 28% in 1999. After quadrupling its profits during the past year, thanks to soaring coal prices, U.K. coal is considering re-opening mothballed coal mines. Coal-fired power plants also are on the rebound in much of continental Europe, especially in places like Italy and Germany, where nuclear power is banned. As the price of crude soars, oil-burning power plants in Italy are being converted to coal-burning plants. Coal will rise from about 14% to about 33% of Italy's power generation mix in the coming years.
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Profiting From King Coal: Making A Mint
For investors, coal's unexpected revival offers huge, if uncertain, potential. Unlike volatile petroleum and natural-gas prices, coal prices have remained cheap and steady. But recently, several factors have converged to push coal prices, and coal stocks, to record highs. Years of oversupply, scaled-back production, and lower prices have led to lower inventories. Supplies also are uncharacteristically tight, thanks to an unusually cold winter and supply disruptions in Australia and South Africa.
Sustained demand from the booming economies of China and India, where power generation needs to expand at twice the rate of double-digit GDP growth, will continue to pressure prices. Already, coal accounts for four-fifths of China's energy use. By 2020, China will be responsible for 40% of global coal consumption. China's voracious appetite for energy has meant that it became a net importer of coal for the first time last year. And China soon will be joined by other fast-growing Asian economies such as Vietnam.
Exploding demand, combined with supply disruptions, adds up to one thing: higher prices for coal. Macquarie Bank expects metallurgical coal to reach an average price of $150 per metric ton in 2008. Citicorp is even more bullish, forecasting that the annual contract price for thermal coal will reach $100 per metric ton in 2008, while the price of metallurgical coal may hit $200 per ton. (Thermal coal is used for heating and power generation. Metallurgical coal is used in steel manufacturing). Benchmark prices for some grades of thermal coal already have hit the $100 per metric ton level -- double September's price. The price of metallurgical coal has even tripled in some cases. The coal boom is on. And that spells opportunity for savvy investors ready to tap into the profits to be had by investing in King Coal.
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文章来源：MoneyShowAsia.cn |
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