Alaska Coal and Warming

[ArcticMelt2]

As you know, the northern coast of Alaska is an area with one of the fastest warming on the planet.









But at the same time, Alaska has the largest reserves of fossil fuels.

http://www.groundtruthtrekking.org/Issues/AlaskaCoal/alaska-coal-resources-reserves-export-carbon-dioxide.html



There is such a huge amount of coal on the north coast of Alaska that it is enough for 600 years of modern consumption. The amount of coal in Alaska is 10 times the mass of carbon that human civilization has already thrown away (about half a trillion tons). And about the same amount of carbon reserves in the Persian Gulf.

[ArcticMelt2]

All this enormous amount of coal is concentrated on a small section of the Arctic coast:



Ice conditions for sea transportation of this coal are improving every year:



In addition, oil reserves in Alaska are rapidly depleted:



All this suggests that the inhabitants of Alaska are very tempted to become the new coal OPEC and turn Barrow into a new coal Dubai:



In general, I wonder which way the inhabitants of Alaska will choose green energy (hydroelectric power plants, geothermal heat, wind power plants) or a path of fabulous enrichment due to the worldwide export of coal by sea?

[ArcticMelt2]

There is little doubt about the number of huge coal reserves on the northern slope, since hundreds of exploration wells have been drilled in this region.



https://www.energy.gov/sites/prod/files/2015/12/f27/Session2-LoraliSimon.pdf

[ArcticMelt2]

In 2009, Alaska was one of the greenest states:



This is largely due to the fact that there is a very large excess of natural gas (ecologists did not allow the construction of a pipeline through Canada).

But how long can Alaska stay green? Indeed, the latest news speaks of how trillions of dollars poured into Texas and Alberta.

[Sciguy]

Given that existing coal exporters are struggling financially due to the decrease in the growth of coal demand (it's already declining in the developed economies and coal is projected to peak in the early 2020s), and the amount of investment needed to mine and ship the coal, the project is dead before it even begins.

Note that the economically recoverable reserves in Alaska are barely visible.  There's more than enough economically recoverable coal elsewhere to keep the power plants running for the decade or so that they have left.

Renewables are already cheaper than operating coal in most of the world.  And the price of renewables is continuing to fall.

[Sciguy]

On peak coal:

https://www.reuters.com/article/us-china-coal-climate/chinas-coal-demand-to-peak-around-2025-global-usage-to-follow-report-idUSKCN1VD0BD

EnvironmentAugust 22, 2019 / 9:02 PM / 2 months ago
China's coal demand to peak around 2025, global usage to follow: report

BEIJING (Reuters) - China’s coal demand will start to fall in 2025 once consumption at utilities and other industrial sectors reaches its peak, a state-owned think tank said in a new report, easing pressure on Beijing to impose tougher curbs on fossil fuels.

“With coal demand in China falling gradually, world coal consumption is forecast to reach a peak within 10 years. Meanwhile, China’s coal demand, currently accounting for half of the world’s total, will decline to around 35% by 2050,” the report said.

On coal exporters facing financial difficulties:

https://www.theguardian.com/environment/2019/oct/23/australias-hopes-to-expand-coal-exports-in-south-east-asia-delusional-experts-say

Australia’s hopes to expand coal exports in south-east Asia ‘delusional’, experts say

Region’s expected increase in coal-fired power plants could turn out to be ‘more fizz than boom’ as construction rates fall markedly

The number of new coal-fired power plants starting construction across south-east Asia has fallen markedly over the past two years as Australia has increasingly looked to the region to expand its thermal coal exports.

Analysis by US-based climate research and advocacy group Global Energy Monitor found work on only 1.5 gigawatts of new coal generation – equivalent to one large Australian plant – began in the region in the six months to June, all of it in Indonesia.

It follows construction starting on plants with a capacity of 2.7 gigawatts last year, a 57% fall below 2017 levels and 79% less than in 2016.

The government’s chief economist reported in September that south-east Asia was expected to be a key source of growth for thermal coal exports as demand from the biggest markets in Japan, China and Korea declined in coming years. The region increased imports by 15% in 2018 and was the only area in which coal’s share of electricity generation rose.

But Ted Nace, Global Energy Monitor’s executive director, said the latest data suggested the expected south-east Asian thermal coal expansion could turn out to be “more fizz than boom”.
He said as the impetus to combat the climate crisis grew, it was increasingly difficult to get people to commit the hundreds of millions needed to build a coal generator.

Tim Buckley, from thinktank the Institute for Energy Economics and Financial Analysis, said the number of Asian coal projects to have secured financial backing had fallen by between 50% and 70% over the past three years, while the rate of plant closures had increased 50%.

He said it suggested Australia’s thermal coal sales would steadily decline over two-to-three decades. “Any suggestion that thermal coal exports have growth potential is delusional or outright misleading,” he said.

[Sciguy]

In order to export coal from Alaska, there would need to be new ports, rail lines and other infrastructure built, costing hundreds of millions of dollars.  It's difficult to see anyone investing in that while other exporters and miners in the "lower 48" are going bankrupt.

https://www.spglobal.com/platts/en/market-insights/latest-news/coal/102519-us-thermal-coal-production-cuts-and-consolidation-expected-as-export-and-domestic-markets-remain-weak-analysts

US thermal coal production cuts and consolidation expected as export and domestic markets remain weak: analysts

Houston — Although the seaborne thermal coal market had a slight price rebound during the third quarter, US exports are expected to remain low this year, forcing more production cuts and consolidation as the domestic market remain bearish as well, analysts said this week.

Despite the slight third-quarter price rebound in the CIF ARA market, "we estimate that most US exports are still not economical at current spot prices," B Riley FBR analysts Lucas Pipes, Matthew Key and Daniel Day wrote, noting dampened seaborne thermal coal demand due to a "sharp rise" in European carbon allowance prices and cheap natural gas and imported LNG.

However, according to Fitch Solutions, "we do not expect growing foreign demand for US coal to supplant weaker domestic demand or reverse the industry's decline."

According to Seaport Global analysts in a report last week, Alliance "shipments, however, won't be flat with 2019 next year; we project they will be much lower."

According to Pipes, Key and Day, "we believe that additional production curtailments are necessary, particularly in the ILB region."

Additionally, in terms of adding competition to the market, according to Fitch, "as coal-fired plants retire, demand for thermal coal will decline, increasing competition among domestic miners."

[ArcticMelt2]

In order to export coal from Alaska, there would need to be new ports, rail lines and other infrastructure built, costing hundreds of millions of dollars.  It's difficult to see anyone investing in that while other exporters and miners in the "lower 48" are going bankrupt.

Now the coal industry in the United States is going through bad times because of cheap prices for shale gas and oil. But will it be so for a long time? If oil and gas production plummets in 5-10 years (shale wells are depleted very quickly), then interest in Alaska's coal may emerge with renewed vigor.

International corporations have invested trillions of dollars in the shale industry in recent years. Look at how fast U.S. oil production has grown in recent years:



Such rapid growth in oil production has never been seen before in the United States.

In this regard, there is no certainty that such an increase in coal production will not begin in Alaska in 5-10 years.

[SteveMDFP]

In this regard, there is no certainty that such an increase in coal production will not begin in Alaska in 5-10 years.

I would disagree on economic grounds.  As long as coal mines exist that can extract and export coal more cheaply, then nobody is going to invest a dollar in extracting coal from Alaska.  We'd have to exhaust Australia's capacity and Wyoming's (among others) before extracting any Alaskan coal would make any economic sense.

[ArcticMelt2]

In this regard, there is no certainty that such an increase in coal production will not begin in Alaska in 5-10 years.

I would disagree on economic grounds.  As long as coal mines exist that can extract and export coal more cheaply, then nobody is going to invest a dollar in extracting coal from Alaska.  We'd have to exhaust Australia's capacity and Wyoming's (among others) before extracting any Alaskan coal would make any economic sense.

But in fact,  now coal mining in Arctic is considered economically viable today in a world where there is no shale oil and gas.

https://www.spitsbergen-svalbard.com/2018/11/20/good-times-for-mine-7.html

Good times for mine 7

Posted on 20. November 2018 by Rolf Stange

Mine 7, the last Nor­we­gian coal mine in Spits­ber­gen still ac­tive, has a his­tory of 52 years – quite im­pres­sive for a coal mine and cer­tainly more than most oth­ers in Sval­bard. And it looks like 2018 will be the best of these 52 years. The amount of coal pro­duced is above ex­pec­ta­tion and so are the coal prices on the world mar­ket.

The 2018 production in mine 7 was scheduled to amount to 130,000 tons, a quantity that was already reached in October, as Svalbardposten reported.

But even more important than the good production is the development of world market prices. In spring 2018, less than 40 US-$ were paid for a ton of coal. Since then, the price has more than doubled and has now stabilised between 95 and a good 100 US-$. This development has helped mine 7 to the best year in its history, economically. Good reason for the 40 miners to be happy – and to welcome 4 more colleagues in their team soon.

The main customers for mine 7 coal are the local power plant in Longyearbyen and a German company called Clariant which is buying 60,000 tons per year. For both, the price is based on the average price of the last 3 years, giving both the producer, Store Norske Spitsbergen Kullkompani, and the customers planning reliability.

https://www.esiasee.eu/single-feed/?postid=1808

Note that coal is mined much north of Barrow. It's just that in Alaska, Barrow has a lot more coal, trillions of tons.

[Sebastian Jones]

Of course, in order to susscesully export coal from northern Alaska, a deep water port is needed...
https://en.wikipedia.org/wiki/Project_Chariot