Insider Secrets

Insider Secrets

Learn how the PROs are making money from the oil and energy market.

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Energy / Coal

  • Coal And Steel May Have Been Given A Lifeline By China

    A big news item the last few weeks has been China’s efforts to curb domestic coal and steel capacity. That’s been a difficult development for China’s local producers — and their employees. But reports emerging this past week suggest it may also be a major opportunity, for the right projects globally. Those signals came last Thursday, when China’s central bank posted new guidelines on the coal and steel sectors. As expected, the bank said it will support tighter lending to China’s domestic coal and steel companies. With the statement saying that commercial banks should stop lending to projects that aren’t…

  • End Of An Era: Peabody Declares Bankruptcy

    In a sign of the times, the world’s largest private sector coal miner just went bankrupt. The St. Louis-based Peabody Energy Corp. warned a month ago that it was considering filing for Chapter 11 bankruptcy, and on Wednesday they made it official. Peabody’s mines will continue to operate uninterrupted through the bankruptcy process. According to Peabody’s court filing, it has obtained $800 million in debtor-in-possession financing facilities. “Through today’s action, we will seek an in-court solution to Peabody’s substantial debt burden amid a historically challenged industry backdrop. This process enables us to strengthen liquidity and reduce debt, build upon the…

  • Who To Back When Oil Rebounds

    In my book Shale Boom, Shale Bust, I isolated three places one could reasonably invest for the long term to bet on the (I believe) inevitable boom cycle in oil that will reemerge in 2017. The first, the E+P ‘survivors’ of the long cheap oil ‘winter’, I’ve talked about almost exclusively and at length. The second, infrastructure and services, hasn’t yet fully revalued for the huge production shifts and decreases to come – and therefore remains an investment for the future. Finally, there are the ‘vultures’ – Those cash-rich companies and private equity groups that can pick off the assets…

  • Bright News In Dark Times For The Coal Sector

    As I discussed last week, there’s been carnage in the coal sector of late. With major producers like Peabody Energy teetering on the brink of bankruptcy. Reading the headlines, it appears the world has given up on coal as a commodity. Which made it all the more surprising the past week to see a major coal-positive announcement emerging from Southeast Asia. That came from Vietnam. Where the government said it is going to require a massive amount of new coal supply — very quickly. Platts broke the story that an official report last Friday projects Vietnam’s coal demand to rise…

  • The Decline Of The Coal Industry Is “Long-Term” And “Irreversible”

    Demand for thermal coal is declining, a trend that appears to be “irreversible.” That is the conclusion from Goldman Sachs, which published a new report on the global coal and gas trade on February 15, and reported on by SNL. For coal producers, this is the latest in a long line of grim warnings, all of which point to a future of shuttered power plants, mine closures, and bankruptcies. Last fall, Goldman Sachs made headlines when it predicted that “peak coal” was drawing near. “The industry does not require new investment given the ability of existing assets to satisfy flat…

  • Will Billion-Dollar Coal Remediation Tech Take a Hit After Supreme Court Ruling?

    Now that the Supreme Court has blocked the federal government’s Clean Power Plan, investors will be wondering what it means for the multi-billion-dollar remediation technology industry that the new rules had promised to create overnight. While the Supreme Court’s blocking of the new rule last week sent waves of hope through the depressed coal industry, which is now eyeing a reprieve—however elusive—a string of companies that were planning on becoming the first billion-dollar beneficiaries of the emissions rules could face even more difficulties now. The floodgates for mercury remediation technology first opened on 16 April last year, when the EPA…

  • Supreme Court Keeps Coal Alive…For Now

    The coal mining industry is in trouble and the Supreme Court holds the industries fate in its hands. Coal has been suffering for years under the dual attack of environmentalists and low natural gas prices. Environmentalists have been pushing utility companies to stop using coal, while low natural gas prices have led many utilities to switch to that cleaner burning and now cheaper fuel as a power source. In an effort to please environmentalist supporters after his election to a second term, the Obama Administration put in place what might be a death sentence for coal mining east of the…

  • This Big Coal Buyer Could Drive Coal Prices Even Lower

    The coal market is in a dark place. With a 10 percent slide in prices during the last few months of 2015 having this week triggered the bankruptcy of America’s second-largest miner, Arch Coal. And it appears some of the world’s biggest insiders in the business think the market could go even lower. That was the message coming out of Japan this week. Where Platts reports that major coal buyer Tokyo Electric Power Co. (Tepco) has decided to keep its options open on pricing supply for the coming year. Sources said that Tepco has opted for floating price contracts with…

  • How Coal Industry Can Attract New Investors

    Tobacco, alcohol, and gambling stocks are often called “sin” stocks because of the nature of their industry. These companies have traditionally had considerably less coverage from analysts and the companies themselves on average have lower valuations than comparable non-sin stocks. Now coal miners may be getting ready to be forced into the category at arguably one of the most challenging times in the industry’s history. This creates an opportunity for both coal companies and investors. Coal miners are increasingly becoming a target for social activists that argue the firms contribute too much to climate change and are detrimental to society.…

  • The Golden Age Of Coal In China Is Over

    China’s coal consumption may have peaked in 2013, and with it, so have the coal industry’s fortunes. A new report from the International Energy Agency (IEA) finds that preliminary data suggests that China’s coal consumption in 2015 is lower than 2013 levels. Slower economic growth, lower energy-intensity of growth, and a campaign to reduce air pollution have severely dented the prospects for coal in China, the report finds. China consumes half of the world’s coal, so what happens in China tends to dictate what happens to coal markets around the world. China tripled its coal consumption since 2000, and it…

Martin tiller