Wow! Check out the story below.
Some of you may recall aspects of the Climate Math presentations at SierraFest and WVEC Convention when we talked about what Al Gore called the "Carbon Asset Bubble", I.e., that coal stocks are dramatically over-priced in a global warming world. Is this the first symptom? Does this provide a justification for the coal divestment projects at WVU and elsewhere? How can we use this information?
JBK
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________________________________ From: Adam Beitman, Sierra Club adam.beitman@sierraclub.org Sent: Thursday, October 30, 2014 8:13 PM To: mtr-list@sierraclub.org Cc: Jim Sconyers; Alice Howell; Sean Sarah; Mary Anne Hitt; James Kotcon Subject: SNL: Recent coal asset sales in Appalachia show fire sale mentality gripping market
https://www.snl.com/InteractiveX/article.aspx?ID=29592255&KPLT=4
Selected:
"Coal mines in hard-hit Appalachia are being sold for pennies on the dollar compared to just a few years ago, recent transactions show, demonstrating the massive collapse in asset value since a peak in coal pricing in 2011.
An SNL Energy analysis of several recent publicly announced transactions finds coal reserves in Appalachia are being purchased on average at less than 40 cents per ton, down dramatically from a few years when reserves in the region were commanding prices eight times as high."
"Other dealshttps://www.snl.com/InteractiveX/article.aspx?ID=27627743 have occurred at even cheaper prices. In August, Corsa Coal Corp.https://www.snl.com/InteractiveX/snapshot.aspx?ID=4247981 closedhttps://www.snl.com/InteractiveX/article.aspx?ID=28958144 its acquisition of PBS Coals Corp.https://www.snl.com/InteractiveX/snapshot.aspx?ID=4100818, which owns several surface and underground mines in Pennsylvania, at a cost of approximately $140 million. The reserves are roughly split between met and thermal coal. The deal included $60 million in cash and $60 million in assumed liabilities of which $20 million in cash bonding will be paid by PBS.
Corsa consultants estimatedhttps://www.snl.com/InteractiveX/article.aspx?ID=29505355 PBS' recoverable, proven and probable coal reserves at 37 million, which would value the deal at roughly 37 cents per ton of reserves.
Seth Schwartz, president of consulting firm Energy Ventures Analysis, said that when you consider what some companies initially paid for their coal assets years ago, the valuations have fallen even further. "These assets are going for under 10 cents on the dollar from what they were at the peak of the market in 2011," he said."
-- Adam Beitman Associate Press Secretary Sierra Club
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Office: (202) 675-2385tel:%28202%29%20675-2385 Cell: (202) 670-5585tel:%28202%29%20670-5585 adam.beitman@sierraclub.orgmailto:adam.beitman@sierraclub.org Tweets @adbeitman
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