It’s been a tough few weeks for our coal industry.
First there was a court ruling blocking a new mine on climate change grounds, then one of the world’s largest producers, Glencore, capped output growth, and finally China was seen to be slowing down Australian imports.
The developments are symptoms of the fossil fuel’s decline and likely signal headwinds for the industry. Australia, which is the world’s second-biggest supplier of coal used for power generation and steel making, has some $70 billion of new coal projects in the pipeline, according to government estimates.
“They’re probably game-changing events from what we once knew of coal,” said David Lennox, a mining analyst at consultancy Fat Prophets. Recent developments should be viewed as part of the fuel’s gradual decline from a position of dominance in the global power mix, he added.
“If you’re building a coal mine and you need to find third parties (to buy the coal), it may not necessarily be so easy, so you’re not going to tip in billions of dollars.”
Of all the shocks to hit the industry, it was perhaps Justice Brian Preston’s ruling in a Sydney court room on February 8 that has the farthest-reaching consequences.
