Coal production from mining’s top ten set to increase
Coal production from the top ten mining companies (Coal India, China Shenhua, Yanzhou Coal, Peabody, China National Coal, Glencore, Siberian Coal, PT Bumi, BHP and Arch Resources) fell from a collective 1,704Mt in 2019 to 1,633Mt in 2020, which is a 4.2% decline.
The most significant declines were observed from Arch Resources (28.6%), PT Bumi (24.9%), Glencore (23.9%), and Peabody (21.8%), according to GlobalData, a leading data and analytics company.
GlobalData expects production from the top ten companies to be between 1,683-1,740Mt in 2021, which is an increase of up to 6.6% compared with the collective output in 2020 (1,633Mt). Operating activities, backed by the rollout of vaccine and strict COVID-19 protocols on-site, returning to normal is expected to be a key production driver for companies in 2021.
Production from Arch Resources (formerly Arch Coal) declined primarily due to the sale of the Holden #22 Surface mine in December 2019, coupled with weak economic conditions during Q1 2020. In addition, the temporary suspension of the Viper mine in Q2 2020 further disrupted the company’s coal production.
Vinneth Bajaj, Associate Project Manager at GlobalData, commented: “Heavy rainfall amid the outbreak of COVID-19 impacted PT Bumi’s output in 2020, while Glencore’s coal output fell for the fourth consecutive quarter as the company’s Colombian coal assets remained suspended as part of the COVID-19 preventive measures.
“Scheduled production cuts across the Australian portfolio also impacted the company’s overall output as did the placement of the Prodeco mine under care and maintenance and strikes at Cerrejon between August and December 2020.”
Peabody’s output dropped primarily due to the upgrade of the main line conveyor system at Shoal Creek, alongside pit sequencing work at Moorvale and a dragline outage at Coppabella. In addition, the company also suspended operations at the Wambo underground mine for around 59 days during the second half of 2020. The closure of mines including Kayenta and Cottage Grove (Q3 2019) and Wildcat Hills (Q2 2020) further impacted the company’s output.
Bajaj continued: “BHP’s coking coal production was impacted by planned maintenance at the Saraji and Caval Ridge mines, environmental disruptions at La Nina, and lower yields at the South Walker Creek and Poitrel mines. Meanwhile, the thermal coal segment, from which the company is expected to exit in the near future, was affected by a 91-day strike at Cerrejon, which started on August 31, 2020.”
“In contrast, production from Coal India rose by 4% owing to a recovery in the offtake from India’s power sector, which was supported by a resumption in industrial and commercial activities as the country’s electricity demand started to recover from the COVID-19 setback,” said Bajaj.
“Output from China Shenhua, Yanzhou and China National Coal Group also increased, rising by 3.1%, 10.2% and 8.1%, respectively, in 2020, mainly owing to a quick recovery in China, particularly during the second half of 2020.”
De Beers passes Newmont to lead ESG ranking of global miners
The world’s biggest diamond producer may not be the first name that comes to mind in a ranking of top environmental, social and governance (ESG) performers. But that’s what the latest industry survey revealed.
De Beers scored the highest in London-based Alva’s quarterly rating of ESG perceptions this week gleaned from publicly available content from social media to NGO research. The unit of Anglo American Plc snagged the top spot in the first quarter from gold heavyweight Newmont due to an increased focus on equality and sustainability.
The report showed the mining industry as a whole lifted its ESG rating amid a string of greenhouse-gas pledges, which offset water management and waste concerns. Companies around the world, particularly raw-material producers, are stepping up sustainability efforts amid heightened scrutiny by the general public and investors. ESG and value-focused exchange-traded funds recorded net inflows of $89 billion in 2020, almost three times 2019 levels, according to Bloomberg Intelligence.
Sibanye Stillwater Ltd. scored the second-highest in Alva’s ratings report and showed the biggest improvement from the previous quarter due to its partnership with Johnson Matthey Plc to find more efficient uses of critical metals used in batteries.
Vale SA scored the lowest ESG rating despite reaching a settlement with Brazilian authorities over a 2019 dam disaster. Vale’s result “is a combination of greater visibility around the original negative story and then dissenting voices on the settlement itself,” said Alastair Pickering, co-founder and chief strategy officer at Alva.