April 15, 2021
Issue 365  |  View Past Issues

Editor's Note

In response to pressure from the financial services industry, diversified global mining companies are now moving to offload their coal assets. The latest is Anglo American which, like South32 recently, is prepared to pay to have coal mines taken off their hands. Vale may face the same problem when it comes to sell its Moatize mine in Mozambique. Glencore’s attempt to relinquish coal concessions in Colombia is not proceeding so smoothly, with the regulator arguing it still has legal obligations to meet including for environmental management. This approach simply means that global companies offloading coal assets to smaller companies does not necessarily lead to reduced production just a different company behind the pollution. In another sigificant development seven European countries — Germany, France, Britain, Spain, the Netherlands, Denmark and Sweden —have pledged to end public export guarantees for coal, oil and gas projects. Meanwhile, Ireland’s Electricity Supply Board has unveiled a plan to replace an old coal plant with a new renewables services hub including support for an offshore wind farm.

A recent report on ties between the Myanmar military and Adani Ports has led to the company being dumped from the Dow Jones Sustainability Indices. While Adani continues to press ahead with its Carmichael coal project, the State Bank of India has so far declined to provide a US$1 billion loan to Adani’s parent company to fund the project. In other controversies, Indonesia’s anti-corruption agency has arrested a businessman allegedly involved in the bribery scandal over licences for a coal mine to supply a new coal plant.

Bob Burton


A carbon registry leaves polluters with nowhere left to hide

The development of a fossil-fuel registry documenting the amount of embedded carbon dioxide in coal, oil and gas projects globally will help governments and international organisations plan for the low-carbon world ahead, writes Mark Campanale in the Financial Times.

Is US coal failing fast or slow?

Whether US coal power ends fast or slow, we must enact policy that enables least-cost retirement and clean energy replacement while easing the transition for affected workers and communities, write Nachy Kanfer, Mark Dyson and Jon Rea in RMI.

Questions over Vale’s planned Mozambique coal exit

Vale plans to sell its Mozambique coal project to a comany “share the same values as Vale” but questions remain over what could happen if the right investor does not materialise, writes [registration required] Leigh Elston in Transition Economist.

Serbia forges ahead with China-backed coal power plant

Serbia’s decisions to press ahead with the construction of new coal plants and a mine expansion funded though China’s Belt and Road Initiative has sparked controversy over pollution standards and secretive decision making, writes Jelena Prtoric in China Dialogue.

Top News

Legal action launched against Belgian bank over fossil fuel bonds: ClientEarth has launched a legal action against the Belgian National Bank (BNB) over its purchase of carbon-intensive bonds as part of the European Central Bank’s (ECB) Corporate Sector Purchase Programme. The legal action requests the Belgian court refer a question – whether the ECB’s programme is valid – to the European Court of Justice and thereby determine whether the BNP’s purchase isI legal. The NGO argues the programme is illegal as the ECB failed to assess the climate impact of buying the bonds of which over half benefit major greenhouse gas emitters. ClientEarth has also written to the ECB urging it to exclude coal and other companies whose activities are incompatible with the goals of the Paris Agreement. (ClientEarth)

Indonesian executive arrested as part of coal plant investigation: Investigators from Indonesia’s Corruption Eradication Commission (KPK) have arrested businessman Samin Tan over his alleged role in paying then-Golkar Party parliamentarian Eni Maulani Saragih 5 billion rupiah (US$343,000) to win approval from the Ministry of Energy and Mineral Resources for mining licenses for a coal project in Central Kalimantan. The mine was controlled by a subsidiary of Samin’s company PT Borneo Lumbung Energy & Metal. The mine was intended to supply coal for the proposed Riau-1 coal plant. Eni and two others were found guilty for their role in the scandal and sentenced to prison terms. (Jakarta Post [paywall])

Alberta opposition party introduces bill to restrict Rockies coal mining: Alberta Opposition Leader, Rachel Notley, has introduced a private members bill which proposes blocking some new coal mines in parts of the Rocky Mountains. Under the terms of the bill proposed projects currently before the regulator could proceed only if they complied with a land use plan yet to be developed. The bill also proposes companies would be eligible for compensation for any mining leases cancelled in the most environmentally important areas but only to the value of the purchase price of the lease. The bill has been welcomed by the Canadian Parks and Wilderness Society. (Global News, Edmonton Journal)

Most Indian coal plants won’t comply with pollution standards until 2024: The Centre for Science and Environment (CSE) estimates the latest Ministry of Environment, Forest and Climate Change pollution compliance deadline will see 72 per cent of the coal capacity continue to pollute for another two to three years. CSE estimates 89,500 megawatts (MW) of coal capacity at 82 plants, accounting for 44 per cent of the country’s coal capacity, will not have to comply until 2024-2025. Another 28 per cent of capacity within 10 kilometres radius of critically polluted areas or cities in breach of air quality standards will not have to meet the standards until 2023. CSE researchers estimate only 28 per cent of total coal capacity is within the category requiring plants within 10 kilometre radius of Delhi’s National Capital Region (NCR) or cities with a population of over one million to meet the standards by December 2022. (Down to Earth)

NSW polling reveals strong support for mine moratorium: Polling by the Australia Institute in the New South Wales state seat of Upper Hunter, where a by-election is currently being held, has revealed 57.4 per cent of respondents support the call by the former Prime Minister Malcolm Turnbull for a moratorium on new coal mine approvals and a plan for the rehabilitation of existing mines. The Upper Hunter valley includes major coal mines with the seat previously held by the pro-coal National Party. The polling revealed support for a moratorium on new mines spans the political spectrum. The poll also revealed 89.5 per cent of respondents supported the proposition that coal companies should have to pay an upfront bond to fully cover the costs of mine rehabilitation. (Sydney Morning Herald, Australia Institute)

South Korean company under pressure to dump Myanmar steel project: POSCO C&C, a subsidiary of the South Korean company POSCO, is under pressure to exit its 70 per cent stake in a steel manufacturing plant in Yangon with Myanmar Economic Holdings, a military-controlled company. Ahead of its recent annual general meeting South Korean NGOs spoke out against POSCO’s plans to build the proposed 2100 MW Samcheok coal plant along with its business ties with Myanmar military-owned companies. POSCO was initially founded as a steel company but following privatisation it has diversified into power, coal and gas projects. (Reuters, Business Korea)

Seven European countries to ban export credit support for fossil fuel projects: Seven European countries —Germany, France, Britain, Spain, the Netherlands, Denmark and Sweden —have pledged to end public export guarantees for coal, oil and gas projects. Britain, France and Sweden have already decided to end fossil fuel export guarantees with the other four countries yet to decide their phase-out schedule. French Finance Minister, Bruno Le Maire, said he hoped the US would also join the group. If the US does join, the eight countries would account for about 40 per cent of export finance among OECD countries. (Reuters)


Australia: The United Nations Principles of Responsible Investment is reviewing Liberty Mutual’s membership after a complaint over its involvement in the proposed Baralaba South coal mine in Queensland.

Australia: Glencore and China Huaneng sign agreement for a carbon capture and storage plant 850 MW Millmerran plants in Queensland but few details released.

South Africa: The court case against three arrested over protest against pollution from the Ikwezi coal mine has been deferred until May 10.

Russia: Government agency plans to auction the 300 million tonne Bogatyr coal deposit in Novosibirsk region.

Sweden: Volvo enters agreement with the Swedish steel company SSAB to source fossil-free steel with first batch to be supplied in 2021.

“Although there is a lot to praise in big corporates committing to reduce their emissions, if they do this by flipping assets to smaller companies after a short-term return, we will just end up with some big, clean multinationals, but the same amount of local environmental and social damage and global carbon emissions,”

says [registration required] Leo Roberts from E3G, a climate think tank.

Companies + Markets

Dow Jones dumps Adani Ports from sustainability index: S&P Dow Jones has dumped Adani Ports and Special Economic Zone, a subsidiary of Adani Enterprises, from the Dow Jones Sustainability Indices due to “recent news events pointing to heightened risks to the company regarding their commercial relationship with Myanmar’s military, who are alleged to have committed serious human rights abuses under international law.” The decision has been welcomed by human rights and environmental groups which filed a complaint with S&P Dow Jones over Adani Ports’ business links to the Myanmar military, its involvement with the Carmichael thermal coal project in Australia and environmental damage at port sites in India. (S & P Global, Justice for Myanmar)

State Bank of India delays decision on loan for Adani’s Australian mine: Despite pressure from BlackRock and Norway's Storebrand ASA, anonymous State Bank of India (SBI) executives have revealed the bank is still considering providing up to US$1 billion to Adani Enterprises for its Carmichael coal project in Australia. Bloomberg reports SBI’s Chairman, Dinesh Kumar Khara, is reluctant to approve the loan but the bank's executive committee will make the final decision. However, the executives said the board hasn’t discussed the issue this year. (NDTV)

Ireland’s Electricity Supply Board plans transformation of coal plant site: The Electricity Supply Board has proposed the conversion of the 915 MW Moneypoint coal plant site into a renewable energy hub. The plant, which has long been criticised by environmental and human rights campaigners, is slated to close by the end of 2025. ESB plans to begin work on the establishment of a €50 million (US$59 million) synchronous compensator to supply grid stability services previously supplied by coal plants to the market as part of the transition plan. ESB has also proposed the construction of a 1400 MW offshore wind farm to be commissioned in two phases over the next decade. ESB has also proposed the site be used a wind turbine construction hub for both the Moneypoint wind farm and to service the market for offshore wind farms in Europe. (Electricity Supply Board)

Anglo American pays to offload its South African coal mines: Anglo American is proposing to offload its seven South African thermal coal mines into a new company, Thungela Resources, subject to a vote by shareholders on May 5. Anglo American is proposing to provide 2.5 billion rand (US$170 million) in capital and other funding support until the end of 2022 if thermal coal prices fall below an agreed threshold. The mines produced 30.5 million tonnes of thermal coal with 16.6 million tonnes for the export market. The prospectus for Thungela notes that the second largest shareholder will be Black Rock, with just over six per cent of the shares in the new company. The company prospectus notes the heavy reliance of South African exporters on the Indian market but, citing Wood Mackenzie data, argues there is a future for the spun-off company. (Financial Times, Anglo American, Thungela Resources prospectus [Pdf])

Colombia rejects Glencore request to drop leases on rehabilitation concerns: Colombia’s national mining regulator ANM has rejected a request by Glencore subsidiary Prodeco to relinquish two contracts for parts of its Calenturitas and La Jagua mines. Glencore sought to end the leases after ANM rejected its request to hold the mines on an extended care and maintenance basis. ANM said Prodeco had outstanding legal obligations with the leases, including for environmental management, making it impossible to allow the contracts to be terminated. Prodeco’s requests to relinquish three further contracts over parts of the mines are currently being considered. (Reuters)

Coal India’s stockpiles climb casting doubt on expansion push: A briefing note by the Institute for Energy Economics and Financial Analysis reports Indian coal producers and power stations have stockpiled a record 132 million tonnes of coal, far higher than the average of the last five years. Of that Coal India and its subsidiaries have stockpiled 103 million tonnes at mine pitheads, a level that will increase pressure to reduce production sinces stored coal declines in quality and is vulnerable to spontaneous combustion. Despite the growth in the stockpiles Coal India still plans to dramatically increase production while the Ministry of Coal is seeking to auction mining rights for 67 potential new mines. (India Blooms, Institute for Energy Economics and Financial Analysis)


“Belt and Road Initiative in the 14th Five Year Plan: an explainer”, Panda Paw Dragon Claw, April 2021.

This blog post provides a useful overview of China’s recently announced Five-Year Plan with a particular focus on the Belt and Road Initiative and how it might change over the 2021 to 2025 period.