HUNTER BUSINESS CHAMBER - Whitehaven Coal€¦ · hunter business chamber 40.0 45.0 50.0 55.0 60.0...
Transcript of HUNTER BUSINESS CHAMBER - Whitehaven Coal€¦ · hunter business chamber 40.0 45.0 50.0 55.0 60.0...
Whitehaven Coal LimitedHUNTER BUSINESS CHAMBER
NEWCASTLE, AUSTRALIA
13 MAY 2016
Australian High Quality Coal Fuelling Asia
Whitehaven’s CostsCOSTS HAVE FALLEN SIGNIFICANTLY OVER PAST THREE YEARS
– Whitehaven’s costs are now firmly
entrenched in the first quartile of the
seaborne market
– Fully absorbed costs have fallen by
26% over three years to A$58/t in H1
2016
– EBITDA margin increasing
– Margin per tonne provides strong free
cash flow
HUNTER BUSINESS CHAMBER
40.0
45.0
50.0
55.0
60.0
65.0
70.0
75.0
80.0
85.0
H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H2 2015 H1 2016
Whitehaven ASP and Costs ex Royalties (A$/t)
Average Sales Price Average Cost of Sales
2 //
HUNTER BUSINESS CHAMBER
-200
0
200
400
600
800
1000
1200
Oil Coal Gas Nuclear Hydro Renewables
Growth in Energy Sources 2004 - 2014 (Mtoe)
Source: BP Statistical Review 2015
3 //
Ten Year Demand Growth COAL HAS BEEN THE FASTEST GROWING ENERGY SOURCE OVER 10 YEARS
HUNTER BUSINESS CHAMBER
-100
0
100
200
300
400
500
600
700
800
Oil Coal Gas Nuclear Hydro Renewables
Growth in Energy Sources 2009 - 2014 (Mtoe)
Source: BP Statistical Review 2015
4 //
Five Year Demand Growth COAL HAS BEEN THE FASTEST GROWING ENERGY SOURCE OVER 5 YEARS
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
1.10
1.20
8.010.012.014.016.018.020.0
Su
lph
ur
(%a
.d.)
Ash (% a.d,)
Thermal Coal - Ash vs Sulphur
Korea
China
Hunter Valley
(Japan)
– Whitehaven produces some of the
highest quality coals sold in the Asian
region
– These high yielding, high quality
coals are sold into the premium Asian
seaborne markets
– As countries strive to reduce their
carbon emissions and use high
efficiency low emissions (HELE)
technology, they need and use higher
quality coals
High Quality Coal
Lower Quality Coal
Whitehaven
HUNTER BUSINESS CHAMBER 5 //
Gunnedah’s High Quality Thermal Coal
HUNTER BUSINESS CHAMBER
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2013 2040
World Electricity Generation by Source (TWh)
Coal Gas Oil Nuclear Hydro Renewables
Source: IEA World Energy Outlook 2015 – New Policies Scenario
6 //
Global Electricity Demand Growth GLOBAL ELECTRICITY DEMAND FORECAST TO INCREASE BY 50% BY 2040 WITH COAL’S SHARE OVER 25% IN 2040
HUNTER BUSINESS CHAMBER
0
100
200
300
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600
2013 2020 2025 2030 2035 2040
IEA Forecast Coal Fired Electricity Capacity (GW) and Coal Required (Mt)
GW Coal Demand
Southeast Asian Countries: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar,
Philippines, Singapore, Thailand and Vietnam
Source: IEA Southeast Asia Energy Outlook 2015 based on the “central scenario”. If the
IEA “bridge scenario” was used electricity generation would be lower.
– Based on IEA forecasts coal fired electricity
capacity in Southeast Asia will almost
double between 2013 and 2020 and will
more than quadruple between 2013 and
2040
– Australian and more specifically
Whitehaven’s coal is well placed to supply
the growing demand
– Coal demand to increase by over 350Mtpa
from 2013
7 //
SE Asian Growth – Stronger MORE GENERATING CAPACITY BEING ADDED IN THE LONGER TERM
HUNTER BUSINESS CHAMBER
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
Subcritical - Lignite Subcritical - BlackCoal
Super-critical Ultra Super-critical
Emissions by Technology (tCO2/MWh)
(18%)(34%)
(22%)
(36%) (49%)
– If Australia converted its lignite fired
subcritical power stations to black
coal fired USC plants then CO2
emissions would fall by about
33Mtpa or about 6% of the current
total emissions for Australia
8 //
Coal – Pathway to Lower Carbon EmissionsUTILISING HIGH QUALITY COALS IN MORE EFFICIENT HELE POWER STATIONS LOWERS EMISSIONS
HUNTER BUSINESS CHAMBER
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500
1000
1500
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2500
All Countries current All Countries current & planned
Asian Coal Fired Power by Technology (GW)
Sub-critical Supercritical Ultra Supercritical
Source: IEA Clean Coal Centre, September 2015. Countries: Bangladesh, China, Japan, Malaysia, Philippines, South Korea, Taiwan,
Thailand and Vietnam
9 //
Deployment of HELE Gathers MomentumTHERE ARE 670 HELE UNITS IN OPERATION IN ASIA WITH A FURTHER 1066 PLANNED OR UNDER CONSTRUCTION
HUNTER BUSINESS CHAMBER
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40
60
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100
120
140
Large SolarPV
Large Hydro OnshoreWind
CCGT Geothermal SuperCritical Coal
Levelised Cost of Electricity SE Asia (US$/MWh)
– Supercritical and ultra supercritical power
stations provide reliable low cost electricity
to the large populations in southeast Asian
countries
– The intermittent nature of power from wind
and solar are not the answer in these
countries
Source: IEA Southeast Asia Energy Outlook 2015
10 //
Why are SE Asia Countries Deploying HELE Technology RELIABILITY AND LOW COSTS ARE DRIVING ASIAN COUNTRIES TO BUILDING COAL FIRED POWER STATIONS
26%
27%21%
9%
8%
3% 3%2% 1%
Japan COP21 Target Mix 2030
Coal
LNG
Nuclear
Hydro
Solar
Oil
Bioenergy
Wind
Geothermal
– In H1 FY2016, 62% of Whitehaven’s thermal coal
was sold in Japan, to increase as Maules Creek
coal is sold into Japan
– Coal will remain a key fuel source for Japan into
the future
Source: J-Power, Japan Government energy and climate policy July 2015 and Coal in
the 4th Strategic Energy Plan April 2014
Note: 1 The US Greenhouse Gas inventory report advises 2013 US CO2 emissions of
6.7 billion tonnes, 2 United States of America, China and India
HUNTER BUSINESS CHAMBER 11 //
Narrabri Coal Used in Japan’s Most Efficient Power Station IF JAPAN’S COAL FIRED GENERATING EFFICIENCY WAS ADOPTED ELSEWHERE2, CARBON DIOXIDE EMISSIONS WOULD BE REDUCED BY 1.5BT/Y1
HUNTER BUSINESS CHAMBER
– Coal is NSW’s most valuable export commodity
generating $14 billion in revenue in FY2015 and
20% of the value of all exports
– More than 20,000 people are directly employed in
the industry with many more indirectly
– Newcastle is the single largest coal export port in
the world
– Mining disturbs less than 0.1% of the land
surface in NSW
– Exports are growing strongly and will continue to
grow as Asian demand increases0
20
40
60
80
100
120
140
160
180
200
2003/04 2005/06 2007/08 2009/10 2011/12 2013/14
NSW Coal Exports (Mt)
Source: NSW Coal Services Annual Report FY2015
12 //
Coal in NSW COAL GENERATES OVER 85% OF NSW’S ELECTRICITY
– Whitehaven has 850 employees (FTE) with more than
75% living in area of our operations
– Delivered economic benefits with more than $800m
invested into NW NSW region over past 3 years
– Supporting growing communities – Gunnedah LGA
population grew from 11,524 in August 2006 to 12,826 in
2013/14 (11.3% increase).
– Population also increased year-on-year (2013/14) in
Liverpool Plains (0.7%) and Narrabri (0.6%)
– Total employment in Gunnedah Shire increased 16%
between 2001-2011, while agricultural employment in area
declined 22% over same period.
10,500
11,000
11,500
12,000
12,500
13,000
2005/06 2009/10 2013/14
Gunnedah LGA Population Growth
HUNTER BUSINESS CHAMBER
Source: ABS and Whitehaven Coal
13 //
Delivering Real Economic and Social BenefitsSINGLE LARGEST EMPLOYER IN NORTH WEST NSW REGION
HUNTER BUSINESS CHAMBER
– NSW has fallen to the second least attractive state for mining investment in Australia on the Fraser
Institute’s ‘Investment Attractiveness’ Index
– What is the Government’s own view on coal mining and the development of the State’s hydrocarbon
resources?
– Is New South Wales sleepwalking into an energy policy abyss?
– no structured plan for growing our export coal markets, and
– no structured plan to avoid becoming reliant on imported energy from other States
– Will we miss the commercial opportunities in SE Asia?
– What about large scale emissions reductions by promoting the use of our cleaner coals?
–
14 //
NSW Government Support IS THE NSW GOVERNMENT PROVIDING SUFFICIENT SUPPORT TO THIS KEY INDUSTRY?
THANK YOUwww.whitehavencoal.com.au