Australia will be among the most expensive places to produce steam coal over the next 10 years, according to a new study by the International Energy Agency
Australia will be among the most expensive places to produce steam coal over the next 10 years, according to a new study by the International Energy Agency. The IEA puts the average cost of steam coal production for Australian greenfield projects at $90-95 per tonne, including sustaining and development capital costs. US Powder River Basin production is expected to cost $20-25. The range between Australian producers and the lowest cost US production includes South Africa, Columbia, China and Russia. The IEA analysis suggests that prices will have to be high enough to support new production but, among the major producing nations, Australia is at risk of struggling for profitably indefinitely.
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John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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