Picture: THE TIMES
Picture: THE TIMES

SA, with the sixth largest coal resource in the world, should position itself to supply pent up demand for the fossil fuel in developing countries. 

Speaking on Thursday at the IHS Markit Annual South African Coal Export Conference in Cape Town, industry leaders said that despite  growing negative sentiment towards coal in the Western world, this was not the case in developing and emerging nations.

Vuslat Bayoglu, executive chair of SA miner Canyon Coal, said that while energy consumption in Europe is flat, or even decreasing, in other regions it is ramping up exponentially.

Some 1,600 new coal-fired power stations are being planned in 62 countries, which could expand the world’s coal power capacity by 43%. “There’s a big demand for coal, we can’t deny it,” Bayoglu said. “The reality is that countries are using coal to power their economies.”

But negative associations with coal has seen continued divestment of major companies from the industry. Mining giant Rio Tinto, for example, has sold off its coal mines in a move away from fossil fuels.

In SA, the move away from coal has been aggravated by policy uncertainty. Anglo American has sold off all mines that supply coal to Eskom and South32 is in the process of spinning of its SA Energy Coal.  

“Who is going to supply this coal to the world?,” Bayoglu asked.  SA, with 118 years worth of coal reserves, is well positioned to do so.

The coal sector is also a valuable source of jobs — more than 86,000 — and foreign currency earnings. The industry does, however, recognise that reducing carbon dioxide and other harmful emissions is vital. Chudi Egbuna, sales director at GE Power, said that understanding clean-coal technology is fundamental to the SA economy.

He said upgrades and retro-fitting plants allows for more efficient combustion of coal and reduces sulphur dioxide, nitrogen oxide and carbon dioxide emissions.

GE technologies has helped plants achieve 49% efficiency rates, compared with Eskom’s fleet, which has an efficiency of between 33% and 38%. Said Egbuna, There is huge ability for us to optimise.” 

steynl@businesslive.co.za