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Permalink Reply by dbob on July 20, 2012 at 4:54

Coal is an interesting long term and short term issue.  In the short term, based on number floating around this spring, the natural gas/coal breakeven value is somwhere around $3-$4/mcf.  Certain power plants can switch, relatively quickly, between the two fuels, and that helped give a little floor in the spring.  In other cases, whole coal plants were idled or sent in to maintenance early while chepaer gas plants went on line.  During the summer months, when demand is highest, both the coal and NG plants are likely up and running.  When it cools off again, we will get a better idea where things stand in the near term.  Remember though, that the cost of that coal can be quite variable between power plants.  Some of the "mine to mouth" power plants like the Luminant stuff in Texas probably has a pretty low BTU cost.  Convserly, power plants having to ship coal long distances will have higher costs. 

 

Looking long term - yes the EPA  rules and some of the court cases appear to spell a death blow to new coal fired plants.  Look for the cross state air rule to take out a few coal plants next year, particularly due to the low cost of NG - perversely, the low cost now makes those plants unattractive to re-fit for the cross state air rule.

 

Old cajun proverb (translated) "may you live in interesting times."

 

 

 

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Permalink Reply by adubu on July 20, 2012 at 6:29

dbob-- coal is in a Secular Bear Market and will not rebound like prices usually does because of issues discussed-- cheap Nat Gas, EPA, etc. The market in the USA will fade rapidly in coming years. Their strong Lobbyist will run into headwinds in Wasington.  Coal will survive only by increases in Exports to China, et al.

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Permalink Reply by dbob on July 20, 2012 at 8:30

Adubu - again - short term http://in.reuters.com/article/2012/07/20/utilities-coal-gas-idINL2E...

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Permalink Reply by Krkyoldhag on July 20, 2012 at 9:03

Its 3 pm and ng is at $3.08

If I had a smiley face would put it right here.

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Permalink Reply by little ole 1st grade teacher on July 22, 2012 at 10:36

:)   :)       (Colon:)Bracket)       Didn't know how to get a :)  until my daughter told me how to    don't know how to get a full smiley face yet.   LOL   Will have to ask her about that one. 

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Permalink Reply by Krkyoldhag on July 22, 2012 at 11:24

:)  Ok so I off topic!!! but isn't it great to smile after all the sad news out of Colorado?

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Permalink Reply by Sandbar on July 20, 2012 at 18:02

     KRKY..........12:00 midnight at $3.09. It's nice to breath again.

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Permalink Reply by Krkyoldhag on July 21, 2012 at 1:52

Yes it is...I am thinking ..will figure out what I think is happening if let the old brain crank up.

I kind of concerned about the news..or lack of news.  $3.09 looks good to me.

The Batman horror has saturated the airwaves for the last two days..it has taken over.  Suddenly there is NO news of Syria (with a regime' about to fall), our ships in the Strait, Iran, or any where else in world. 

There is no perspective on this thing in Colorado.  We lost hundreds of homes and thousands of acres of land here in Texas last summer,  Colorado Springs came within miles of being incinerated and it hardly made a ripple in the news, less attention from Washington. Fort Hood was big. I don't mean that this is not horrible..Whitman in the Tower in Austin was horrible.  But I worry that the perspective is lost.  Its become a demand for more gun control.  Political.  Death of children should not be made political but this is happening right now.

I want to know what is going on besides the shooting in Colorado.  So when the media finally comes up for air and reports what our ships are doing, what Iran is up to, as well as Syria then I will have a better feeling about what will be happening here in the energy business.

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Permalink Reply by adubu on July 21, 2012 at 3:31

KOH===understand your feeling but the site monitor going to slap our writting pen--- we getting off subject of this thread :(

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Permalink Reply by Krkyoldhag on July 21, 2012 at 6:07

Its all related..but message understood.  Won't there be a  need for lots more pipe lines to get the NG to market? 

Is there any pipe line activity going on right now? 

How long is it expected for new processing facilities to be on line?

Won't that all affect prices?

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Permalink Reply by P.G. on July 21, 2012 at 4:23

Bottom line is there needs to be more markets/uses for NG...

NG prices are finally creeping back up but then drilling is way down...not so good for those who are waiting for their sections to be drilled.

How easy would it be to drill NG back into an over supply again?

Shipping it overseas will only make the shippers wealthy.

Politics can change  the EPA's attitude towards coal..

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Permalink Reply by tc on July 21, 2012 at 7:55

Per the 7/20/12 Pittsburgh Post-Gazette 2 small coal companies are shutting a couple mines and 250 high paying jobs are lost in PA & OH.  These are battle ground states and JOBS are the issue.  These 250 jobs will be magnified and I can see promises being made by politicians to win these states.  Coal will probably lose the war in the very long term, but it won't go without a fight and it will win some of the battles.

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