Santa puts coal stocks in stockings for last time 19 Dec 2023 Producers of the dirty fuel, like Peabody and Arch Resources, have generated excellent returns over the past two years, a trend that may continue in the near term. But government policies are rapidly eroding demand. Fewer investors will want the shares in Christmases future.
Glencore’s split is yet to be copper-bottomed 6 Dec 2023 Having merged its coal assets with Canadian miner Teck’s, the $70 bln Swiss group is eyeing a spinoff. But boss Gary Nagle faces a tricky call on what to do with oil trading. And the appeal of a coal-clean metals split may hinge on whether Teck’s own separation creates value.
Time to target fossil fuel demand, not supply 11 Sep 2023 Climate activists want countries and companies to stop producing oil, gas and coal. It would be more effective to focus on cutting demand for fossil fuels – by campaigning for carbon taxes, green subsidies and faster licences for renewable energy, says Hugo Dixon.
Brookfield’s climate promise faces a dirty test 8 Sep 2023 The investor’s pending $12 bln co-purchase of Origin includes Australia’s largest coal plant. Fear of blackouts may keep it running past an expected 2025. Even with deep pockets and oodles of renewables expertise, it may be hard to avert such an epic energy transition fail.
Indian interlopers can disrupt global mining M&A 25 Aug 2023 Sajjan Jindal’s JSW Steel can afford Teck’s coal unit. A full or part bid rivalling Glencore’s $8 bln offer would secure key raw materials and reduce the risk of geopolitical supply shocks. It’s a strong motive for buyers in the fastest growing market for the alloy to do deals.
Glencore deal epitomises net zero’s reduced status 27 Jul 2023 The $75 bln miner used to argue it was better to wind down its coal assets than sell them to a less responsible owner. Now CEO Gary Nagle wants to buy a rival and spin off the enlarged coal unit. Investors, distracted by energy security and fat profits, are unlikely to stop him.
Windfall taxes get a breezy airing Down Under 14 Jun 2023 New levies on high coal prices accounted for a third of the $10 bln in resources royalties Queensland raked in over the past year. It helps the state invest in renewables, hospitals and childcare without trashing fossil-fuel firms’ margins. It’s how such tariffs should work.
Capital Calls: London crypto move, Stellantis SPAC 12 Jun 2023 Concise views on global finance: British Prime Minister Rishi Sunak welcomes Andreessen Horowitz’s UK office just as cryptocurrencies face a regulatory crackdown in the US; the European carmaker’s move to back a London blank-check vehicle is less hairy than it sounds.
Rich countries and India should cut a climate pact 10 Apr 2023 Helping the world’s most populous nation grow in a green way is one of the best things that could happen for its people and the planet. While there are many obstacles to a deal between the G7 and India, the prize is great enough for both sides to overcome them, says Hugo Dixon.
Glencore’s Teck gambit could slip on an oily patch 6 Apr 2023 The Swiss commodity giant’s $22 bln plan to buy its Canadian peer and spin off its coal arm offers an alternative to investors voting on Teck’s own breakup plan. Yet Glencore’s oil trading unit may hurt the value of the non-coal bit. Teck’s pitch has flaws too, but looks cleaner.
Glencore will have to dig deep for Canadian miner 3 Apr 2023 Teck Resources rejected the Swiss giant’s plan for a $23 bln all-share takeover and spinning off their combined coal units. The Canadian firm is pursuing its own split. Since the deal would help solve Glencore’s dirty-fuel problem, it will have to pay more to win over its target.
Americans indulge green at home, black abroad 31 Mar 2023 U.S. renewable power generation surpassed coal for the first time in 2022. But companies like Peabody Energy and Consol Energy are benefitting from exporting their dirty power source. Cleaning up the country's act, while exporting more filthy fuel, wastes part of this effort.
Capital Calls: World Bank, Bumble, Wood Group 23 Feb 2023 Concise views on global finance: The U.S. picks ex-Mastercard boss Ajay Banga to run the multilateral development bank; while the dating app’s shares are down, private equity owner Blackstone is still in the money; the UK oil services group has turned down three bids from Apollo.
Energy transition’s $12 bln deal becomes forex bet 22 Feb 2023 Brookfield and MidOcean have reduced their offer for Australia’s coal and gas-heavy Origin Energy, but only by 1%. Large investors also will be paid partly in U.S. dollars. If exchange rates move only slightly, it would more than compensate them for the price cut.
Glencore’s coal fudge risks satisfying no one 15 Feb 2023 The dirty fuel is booming, and made up half of the $80 bln commodity giant’s 2022 EBITDA. Green investors may want CEO Gary Nagle to phase it out faster, while financially motivated ones would favour more mining. He’s doing neither, and paying the price with a middling valuation.
Anti-ESG movement has investment case 12 Dec 2022 American coal firms are generating so much cash that at current rates, it equals their market value, including debt, in under two years. Oil firms like Exxon could earn back their value in five. Even if recession squeezes profit and decarbonization looms, valuations are too low.
Aussie energy woes put miners in windfall hole 5 Dec 2022 Canberra may cap the soaring price of coal or tax profits to reduce electricity costs. That’s a potentially explosive new risk for producers like Whitehaven, which is buying back up to a third of its stock at near record highs. Such short-term largesse could come back to burn.
Don’t dump on U.S. coal plan. Make it better! 11 Nov 2022 Sceptics fear an American plan to use voluntary carbon markets to accelerate the energy transition in poor countries, unveiled at COP27, could amount to greenwashing. But done properly, it could help developing markets close down coal plants, a major source of pollution.
Capital Calls: Coal’s fear-then-greed trade 19 Oct 2022 Concise views on global finance: Shares of Aussie coal miners fell on production disruptions from floods, only to quickly rise as investors bet on tighter supplies and higher prices.
Ukraine has more pluses than minuses for climate 26 Sep 2022 The Russian invasion has prompted other countries to boost gas production and burn more coal. Climate diplomacy is on ice. But this crisis will also prompt a dash for cheaper and more secure renewable energy. That helps the fight to slow global warming, says Hugo Dixon.