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A. Now is the crucial time – The global coal boom will last, but continued commitment bythe governmentt is key to industry success – top industry experts agree
/08, June 27, 2008, “Current US coal boom likely to last: experts”, jlk,http://www.businessspectator.com.au/bs.nsf/Article/UPDATE-1-Current-US-coal-boom-likely-to-last---exp-FYRWM?OpenDocument NEW YORK --
Unlike previous US coal booms, the current one is likely to last because of persistentworld demand and output problems in other producing countries,
an industry analyst has said. JimGriffin, managing director of Rothschild Inc, told the 2008 McCloskey Coal USA conference that some
factors in today's coal market resemble the boom-bust cycle of the 1980s, such as strong Asian demandand a weak dollar. But now is different
, he said,
citing the difficulty of expanding coal productionamid regulatory, labour and financing challenges
. He also cited
the breadth of world economic growth
is driving persistent coal demand
. "I do not believe
this cycle will end like the last
," Mr Griffin said.Mr Griffin was one of
foresee a bright future for the coal industry into theindefinite future.
Gerard McCloskey of The McCloskey Group, a conference sponsor, predicted worlddemand for seaborne coal will grow to 800 million tonnes a year by 2017 from 650 million tonnes currently.Mr McCloskey said the anticipated growth in coal consumption comes against a background of supplychallenges that may see export coal coming from new places such as Tanzania and Alaska. Jeff Watkins, president of Hill & Associates, a leading coal industry consultant, predicted that in the boom environment,
US coal exports will top 90 million short tons (81 million tonnes) in 2009.
Steve Leer, chairman andCEO of Arch Coal Inc, a major US producer, went further, predicting
US exports will reach 100 milliontonnes by 2010
. Hill & Associates' current projection of exports in 2008 is between 84 million and 88million tons (75 to 79 million tonnes), said Hill Vice President John Hanou.
That is up from previousindustry estimates of about 80 million tons.
Current world coal production is about 6 billion tonnes.Current US production is about 1.1 billion short tons (990 million tonnes). Despite
soaring demand, theindustry faces a hostile political environment because of the perception that coal worsens globalwarming
. The point was illustrated by remarks from a Greenpeace spokesman at the conference. "For us,coal isn't the answer. Coal is a part of the problem," Carroll Muffett of the environmental action group said.Kenneth Nemeth, executive director of the Southern States Energy Board, a coalition of 16 states and two USterritories, argued that coal is a key answer and that it can be done cleanly. But he said
coherentgovernment energy policy is needed to develop it.
"We have secure, real alternatives to what we're doingnow, and we're not doing anything about it," Mr Nemeth said.
r, government relations vice president for Peabody Energy,
agreed policy has not been coherent and blasted US withdrawal fromFutureGen, a government-industry plan to build a "clean coal" power plant
. He said development of the carbon capture and sequestration technology associated with the project is needed to provide adequateelectric power while minimising damage to the environment. He said industry remains committed toFutureGen, and he predicted it will continue after a new US president and Congress take office in 2009.
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