See the bottom of this section for information on our new India Forecast Report.

Coal Practice

Overview

JD Energy focuses its efforts on forecasting both short-term and long-range trends in coal markets. We employ a multi-disciplinary approach - encompassing the views of our market economists, mining /combustion/environmental engineers, energy economists, transportation analysts and research specialists - in conducting our analyses. This ensures that we arrive at an objective and well-thought out perspective to present to our clients in the electric power, energy producing, government, and financial sectors.

Expertise

The perspective we bring to understanding the dynamics of coal pricing in the marketplace is supplemented with a firm foundation in both the mining engineering aspects of producing coal and the combustion/environmental engineering aspects of burning it. Specifically, each of our assessments of regional coal markets includes an evaluation of :

• Coal Demand – the outlook for specific coals as they compete both with coals of differing qualities from other producing regions and as their use is determined in the broader arena of inter-fuel competition with such energy sources as natural gas.

• Coal Mining Conditions – an evaluation of the productivity outlook for each mining area as it is impacted by such factors as reserve quality and quantity, seam thickness and overburden ratios, conduciveness to various types of mining equipment, environmental sensitivity, etc.

• Coal Pricing - Our forecasts are highly focused on the individual price dynamics of a large number of coals in different markets. We give extensive coverage to the immediate short-term markets and also give in-depth assessments of the various long-term forces at play that will affect each coal’s competitiveness decades from now.

• Alternative Cases – In recognition of the significant level of uncertainty that pervades energy markets, JD Energy incorporates the evaluation of probabilistic alternative cases in all of its analyses, thereby providing the user with a carefully considered bandwidth of outcomes for purposes of contingency planning and risk assessment.

Coal Publications

Coal Monthly (Monthly with forecasts for 24 months). A monthly forecast of 10 key spot coal prices coupled with a 6-page narrative analysis of major market drivers including production, stocks, and exports/imports.
Quarterly Coal Forecast. This 10-15 page forecast is issued quarterly and emphasizes the spot market price outlook for 10 major coal producing regions both for the upcoming 8 quarters as well as an annual average price forecast for a 20+-year period.
Coal Price Analysis Reports. Coal Price Analysis reports are more detailed , individual coal region-specific reports issued annually on each of the coal producing regions listed below. The price forecast includes a Base, High, and Low Price Case for each coal, as well as covering several market prices for each coal (including Spot, Annual Contract, and 3-year Contract prices).

JD Energy publishes Coal Price Analysis reports on each of the following regions:

U.S. Coal Producing Regions

◊ Northern Appalachia

◊ Central Appalachia

◊ Southern Appalachia

◊ Ohio

◊ Illinois Basin

◊ Powder River Basin

◊ Western Bituminous (Green River /Hams Fork/Hanna /Uinta)

◊ San Juan/Raton Basin

◊ Lignite (Gulf and Northern)

International Coal Producing Regions

◊ Colombia

◊ Venezuela

◊ Indonesia

◊ South Africa

◊ Australia

◊ Poland

◊ Canada

Contract Escalators. This annual publication provides both insights into current contracting trends and forecasts of the most commonly-used escalators (e.g., Implicit Price Deflator, Consumer Price Index, various PPI indices, RCAF series).

Purchasing Publications

JD Energy Coal Practice publications are available for individual purchase, or as part of a larger subscription.

To learn more about subscribing to JD Energy’s Coal Practice, please complete the Learn More form to have a JD Energy professional contact you, or simply call us at (301) 815 - 5470.

A Special Study…

COAL in INDIA

Another China or a uniquely Indian Development?

A 15-year Forecast with Three Scenarios

Background & Introduction

Despite the fact that the world was aware of the potential for China’s economy to grow and it was a much talked of occurrence, the speed with which this transpired caught even the most optimistic observers unprepared. India along with Brazil and Russia, like China, are the economies where this phenomenon is next likely to take place. Being the second most populace nation on earth and starting from a very low base it is considered by some observers that India will be the next country where this could occur with unbridled rapidity.

Purpose

The purpose of this study is to evaluate the role of coal in India in the context of the likely evolution of the economy. Particular attention is given to the impact of the many difficulties and inefficiencies of a country that is still a largely agricultural economy with one of the lowest consumptions of energy per capita in the world. Any material change in this energy consumption will have enormous consequences for the world’s energy balance.

Some of the Questions Addressed

General

§            At what speed is the Indian economy likely to grow

§            What is the likely impact on both coking and steam coal demand

§            What plans exist for:

o       The power sector

o       The steel sector

o       The indigenous coal industry

§            Is India likely to be able to meet its growth targets

§            Does India have the capacity to fund the necessary infrastructure developments

§            What role will be played by government and what by the private sector

§            How will the government balance incentives for imports versus domestic industry

§            Is their a major role for overseas investors

§            Will India give a greater role to its vast coal reserves or other sources of energy

Coal Specific

§            What is the forecast for India’s coal demand – three cases are run

§            What are the current impediments to the growth of coal

§            What needs to be done to improve production and distribution

§            Will emphasis be placed upon indigenous or imported coal

§            Are there investment opportunities for overseas companies

§            What are the prospects for imported coal volumes

TABLE OF CONTENTS

COAL in INDIA

I. SETTING THE SCENE: The Energy & Economic Situation Today

INDIA: AN OVERVIEW

POLITICAL BACKGROUND

ECONOMIC BACKGROUND

ENERGY BALANCE

HISTORICAL ENERGY MIX

POWER SECTOR MIX

THE STEEL SECTOR

II. INDIAN GOVERNMENT ENERGY & ENVIRONMENTAL POLICY

A BRIEF HISTORY OF GOVERNMENT APPROACHES

Current Government Approaches

Policies towards Electric Generation

Policies towards Other Energy Sectors

Policies towards Coal Development

Opposition to Policies

Government-Industry Interface

Environmental Policy and the Impact of Kyoto

ATTITUDES TOWARD FOREIGN IMPORTS and INVESTMENT

Across the Economy

Private Investment in the Energy Sector

III.THE DEMAND FOR COAL

THE POWER SECTOR

Balance of Coal versus Other Fuels

Coal Generation

Electricity Demand Pressures

Capacity Growth Targets

Mix of future generation

Planned coal plants

THE INDUSTRIAL SECTOR

Focus on the Steel Sector

Other Industrial Sectors

Non-Industrial Sectors

VI.THE INDIAN COAL INDUSTRY

RESOURCES AND RESERVES

HISTORIC PRODUCTION

OUTLOOK FOR FUTURE GROWTH

SCOPE FOR BENEFICIATION

STRUCTURE OF COAL INDUSTRY

KEY ASPECTS OF INDIAN COAL PRODUCTION

Productivity

Production Costs

Pricing

Transportation

GOVERNMENT INFLUENCE ON THE COAL INDUSTRY

MINING REGIONS

Talcher & Ib Valley

Jharia (BCCL)

Raniganj

Singrauli(NCL)

Karanpura & Bokaro

Assam & Meghalaya(NEC)

Pench & Kanhan

Godavari Valley

Chanda-Wardha

V. INDIA COAL FORECAST: Base Case

ELECTRICITY SECTOR

Introduction

Electricity Generation

Historic Trends in Generation Mix

Plant utilizations establish generation by type

Net efficiencies are used to determine coal consumption

THE STEEL SECTOR

Steel output will grow substantially

OTHER SECTORS

Cement

Iron and Steel Sector

Residential & Commercial

COAL PRODUCTION

VI ALTERNATIVE FORECASTS: The High Coal Use Case

ELECTRICITY SECTOR

Introduction

Electricity Generation

Forecast Trends in Generation Mix

THE STEEL SECTOR

OTHER SECTORS

Cement

Iron and Steel Sector

Residential & Commercial

COAL PRODUCTION

VI.ALTERNATIVE FORECASTS: The Low Coal Use Case

ELECTRICITY SECTOR

Electricity Generation

THE STEEL SECTOR

OTHER SECTORS

Cement

Iron and Steel Sector

Residential & Commercial

COAL PRODUCTION



About the Authors

Ramesh Malhotra owns and manages the operations of Coal Network, which includes coal brokerage, coal blending services, river terminal operations and international trading of a wide range of products and services. Prior to beginning his firm in 1987, Ramesh was President of NERCO Coal Company. Ramesh has been actively involved in the energy industry for more than 30 years.

Lia Sareen conducted the basic research for this report and advised in its conclusions. She currently works at McKinsey & Company and previously worked for CashEdge, an internet financial firm. She received her MBA from the Sloan School of Management (MIT) and her undergraduate degree from Yale University.

David Goldsack is managing director of Northfield Trading Company Limited a coal trading and consulting company based in the UK. He has more than twenty-five years experience in coal both in the UK but primarily internationally having held a number of senior positions in the coal trading industry. In the more recent past he has operated primarily as a coal expert and consultant and until May 2003 he consulted exclusively for Global Insight Inc. In the course of this work he has consulted and written on many associated aspects including areas of the power sector and carbon constraint issues. He is by profession a Chartered Accountant.

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The report, which runs to about 135 pages is published by and is now available from JD Energy Inc. http://www.jdenergy.net

Cost

The cost of the report is US Dollars 1,950 for which you will receive:

• One hard copy report

• Report and detailed forecast tables in electronic format

• A PowerPoint presentation with voice commentary

To purchase or for further information contact:

John Dean                                            or              David Goldsack

JD Energy Inc.                                                      Northfield Trading Company Limited

PO Box 1935                                                         30 Garratts Lane

120 Fairview Avenue                                            Banstead

Frederick, MD 20171                                           Surrey SM7 2EA

USA                                                                       United Kingdom

jwdean@aol.com                                                   david@dgoldsack.fsbusiness.co.uk

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