SA coal at a crossroads
The industry must choose whether to take its chances on exports or concentrate on growing the domestic market
As the world’s appetite for fossil fuels declines, so has investment in new coal projects. The SA coal industry now finds itself at a crossroads. Either it aims new coal production at the export market or gear its growth for South African consumption. But experts say both routes are strewn with pitfalls. Currently 70% of local coal supply goes to the South African market, dominated by power utility Eskom, while the balance is exported. But the South African coal industry is eyeing opportunities globally where 1,600 power stations are under construction in 62 countries across the globe. Exxaro, the largest supplier of coal to Eskom, in March announced it would fast-track new coal projects to sell a high quality product abroad. According to economic risk consultant Rob Jeffrey the outlook for coal exports, particularly into Asia, is expected to remain positive for a number of years. “The Asian countries have determined that their future includes the cheapest source of power which is i...
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