India has some bad news for the world’s struggling miners: it doesn’t want foreign coal.
“I’m trying to find new reserves so I can remove my dependence on imports,” the country’s coal and power minister Piyush Goyal said in an interview Friday at Bloomberg’s headquarters in New York. Asked when India might stop importing the power-plant fuel altogether, Goyal said “I wish it was yesterday. Maybe two or three years.”
In recent years, India’s been considered a possible savior for beleaguered coal miners including Peabody Energy Corp. that have suffered amid slowing Chinese demand and plummeting commodity prices. But it may be no white knight. In 2015, it increased its own production of the power-plant fuel and slashed imports in “a big way,” according to Andrew Cosgrove, a Bloomberg Intelligence analyst.
That trend will probably accelerate in coming years as India seeks to increase its annual electricity production fourfold by 2030, to as much as 4.5 trillion kilowatt-hours from 1.1 trillion kilowatt-hours at present, Goyal said. State-owned Coal India Ltd., the world’s biggest coal producer, plans to increase annual production to about 1 billion tons in the next four years, while India’s overall domestic coal output could climb to 1.5 billion tons, he said.
The company, which produces more than 80 percent of India’s coal, reported record production and dispatches during the year ended March 31, after faster land purchases and government approvals led to the opening of new mines.
India is developing new shipping routes and adding railroad capacity to transport domestic coal from mining areas to coastal power plants in hopes of further reducing its reliance on foreign coal.
“At the end of the day, I may only be left with imports to the extent where certain plants are designed for imported coal,” Goyal said. “Until the time I can either retrofit or replace those plants.”