Coal is a combustible sedimentary rock formed predominantly from plant material that has been deposited in ancient marshy environments. Through burial over long periods of geological time, the plant material is transformed by microbial action, pressure and heat into coal. This process is commonly referred to as "coalification". In Australia, the term "black coal" includes anthracite, bituminous coal and sub-bituminous coal. The higher rank (greater degree of coalification) black coals are predominantly used in either electricity generation (thermal coals) or to produce coke for the iron and steel making industry (metallurgical or coking coals). Black coal is also used in cement manufacturing, alumina refining, paper manufacturing and several other industrial applications.Black coal occurs in all States and the Northern Territory (NT). Most of Australia's Identified Resources of black coal occur in Queensland (Qld) (62 per cent) and New South Wales (NSW) (24 per cent). Australian coal production is dominated by Qld and NSW. In the twelve months to 31 December 2012, Australia produced 501 million tonnes (Mt) of raw coal. Of this total, Qld produced 256 Mt (51 per cent) and NSW produced 235 Mt (47 per cent). During this period, approximately 79 per cent of black coal production came from open-cut mining operations. There are locally important coal mines at Collie in Western Australia (WA), Leigh Creek in South Australia (SA) and in the Fingal Valley and at Kimbolton in Tasmania (Tas).
Between December 2011 and December 2012, the estimate of Australia's Recoverable Economic Demonstrated Resources (EDR) of black coal increased by 6 per cent to 61 082 Mt (Table 1). The estimate of in situ EDR also increased during this period (by 9 per cent) to 77 589 Mt. Most of Australia's Recoverable EDR is located in Qld (59 per cent) and NSW (37 per cent) within four coal bearing, sedimentary basins (Bowen, Sydney, Surat and Galilee Basins). Approximately 31 per cent of Recoverable EDR is located in the Sydney Basin (NSW), 31 per cent in the Bowen Basin (Qld), 13 per cent in the Surat Basin (Qld) and 10 per cent in the Galilee Basin (Qld).In the twelve months to December 2012, estimates of Australia's Recoverable Paramarginal Demonstrated Resources increased by 38 per cent to 1134 Mt and estimates of Recoverable Submarginal Demonstrated Resources remained virtually unchanged at 3984 Mt. Estimates of Recoverable and in situ Inferred Resources increased by approximately 12 per cent (to 64 184 Mt and 89 194 Mt, respectively) during this period.
Table 1: Recoverable resources of black coal in States and Northern Territory at December 2012 (million tonnes).
(% of Accessible EDR)
|New South Wales||7 749||22 963||169||26||8 739|
|Queensland||12 677||36 855||872||3||43 729|
|South Australia||758||40||3 930||9 788|
|Western Australia||236||986||50||25||1 625|
|Total Australia||20 662 (38%)||61 082||1 134||3 984||64 184|
Nearly all black coal EDR is accessible. A relatively small tonnage of EDR is quarantined within State Reserves at Hill River in WA.
Australia's Joint Ore Reserve Committee (JORC) Code reserves are estimated at 20 662 Mt or 38% of Accessible EDR. Included in this tonnage are estimates by Geoscience Australia of reserves associated with operating mines for which reserves were not reported by the mining companies. The estimated resource life of the JORC Code Reserves at the 2012 rate of production is approximately 41 years.
Data published by the Australian Bureau of Statistics (ABS) for coal indicate that exploration expenditure during 2012 declined 6 per cent from the previous year to $709 million. Most of the decline occurred in Qld where expenditure fell 7 per cent to $611 million. In NSW, exploration expenditure fell by 3 per cent to $87 million. (Exploration expenditure data for South Australia, Western Australia, Tasmania and Victoria are not available). In 2012, 19.4 per cent of total expenditure on mineral exploration in Australia was attributable to coal exploration. While this represents a 1.8 per cent fall from the previous year, it is substantially higher than the 14.5 per cent recorded in 2010.
Production and Trade
In 2012, Australian production of raw black coal increased to a record 501 Mt. Due to lower contract and spot prices for both metallurgical and thermal coal during the latter half of 2012, however, the value of Australian coal exports declined from $47 013 million in 2011 to $41 563 million in 2012.
Of the 501 Mt of raw coal produced during 2012, 379 Mt comprised saleable coal. Queensland and New South Wales dominate Australian black coal production and in 2012 accounted for 51 per cent and 47 per cent, respectively, of total raw coal and saleable coal production. During 2012, small quantities of black coal were produced for the domestic market in Western Australia (5 Mt raw), South Australia (3.8 Mt raw) and Tasmania (0.64 Mt raw).
During 2012, Australia exported 145 Mt of metallurgical coal and 171 Mt of thermal coal – an increase in export volumes over the previous year of 9 per cent and 16 per cent, respectively. While Japan remains the primary destination for Australia's coal exports, most of the additional export volumes reported for 2012 were exported to the Peoples Republic of China. (In 2012, imports of thermal coal into China increased by 59 per cent due to increasing electricity demand and the relatively low cost of imported coal).
In 2012, Australian coal exports were valued at $41 226 million. The Bureau of Resources and Energy Economics (BREE) forecasts that between 2012 and 2018, Australia's exports of thermal coal will rise at an average rate of 8 per cent a year to 271 Mt.
Data on world coal resources are compiled and aggregated under two classification systems. In Australia, the term 'black coal' includes anthracite, bituminous and sub-bituminous coal and the term 'brown coal' refers to lignite. Under the international system, only anthracite and bituminous coal are included in the 'black coal' category and sub-bituminous coal is included with lignite and referred to as 'brown coal'.
Under the international classification system, at the end of 2012, Australia was estimated to have 9.2 per cent of the world's proven reserves of black coal and ranked fifth in the world behind the United States of America (26.8 per cent), China (15.4 per cent), India (13.9 per cent) and Russia (12.1 per cent). Under the Australian classification system, it is estimated that Australia has approximately 9.2 per cent of the world's economic recoverable black coal resources.In 2012, total world coal production of black and brown coal reached record levels and Australia was ranked fifth in the world behind China, the United States of America, India and Indonesia in terms of total coal production. Australia exported 319 Mt of black coal during this period and was the world's largest exporter of metallurgical coal and the world’s second largest exporter of thermal coal (behind Indonesia).