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HDI and AXL, the other three insures, will 2025, Bloomberg reported. billion tons a year, some 11% higher than the
not provide insurance on the project after Unlike the previous edition, when China current level, Wood Mackenzie’s Zhai said.
their current residual policies come to an end. made a major push to cut overcapacity to
The news raises questions over Adani’s support prices and help miners struggling
Australian arm’s financial viability as the with mounting debt, the government is not
project logged losses of $279mn in FY20, likely to set any targets for mine closures, HYDRO
taking its cumulative losses including write- analysts forecast.
offs and currency movements since inception The country in 2016 set a target of China Gezhouba Group to
to $794mn. shutting 800mn tons of annual capacity, with
The Gautam Adani-led company has, reductions met two years earlier than planned. build 1.2GW of hydro in
however, refuted the claims saying that there But the lack of a hard target now would
was “no doubt” about the viability of the underscore the continuing dependence on Indonesia
project as strong demand for thermal coal in coal in China, which mines and burns half the
the south and south-east Asia would drive world’s supply. State-owned construction company China
productivity. “We expect the government to continue to Gezhouba Group (CGG) has signed a $1.62bn
“The construction of the Carmichael manage production capacity,” said Zhai Yu, a deal to construct a 1.2GW hydroelectric
project is now well progressed with more than senior consultant with Wood Mackenzie Ltd. power plant in Indonesia.
$1bn in contracts awarded,” a spokesperson of “But maybe not continue to cut capacity, as CGG will run the design, construction
the Indian group told the daily. we forecast demand increasing in the next five material, procurement and commissioning
years.” for the Borneo plant. Work will begin with
Analysts at Wood Mackenzie, Daiwa phase one of the Data Dian plant, owned by
Capital Markets and China Coal Resource Indonesia Dafeng Heshun Energy Industri.
COAL are among those who don’t believe China will When the plant is completed, CGG will
set a target for closing outdated coal mine trial it before handing it over within the five-
China could give up closing capacity in its 14th Five-Year Plan, which will year agreement’s terms.
The company is a subsidiary of China
officially be adopted next year.
small mines closed at 538 yuan a ton on the Zhengzhou Energy Engineering Group, which is in turn
Thermal coal for September delivery
owned by the Chinese state. It said it has
China could ease pressure on local Commodity Exchange on Tuesday, holding at reassured workers of precautions made to
governments to shut older, inefficient coal the lowest level in more than a week. limit the spread of Covid-19.
mines as it seeks to meet rising demand for Total coal production capacity may rise to CGG Chairman Chen Xiaohua said he
coal to boost its economic recovery. 5bn tonnes a year by 2025, from 4.1 billion expects some of the power to be used for
Government officials are in the midst of currently, according to Daiwa. That will help local industries such as metal extraction and
preparing the country’s all-important five- the country meet demand growth expected smelting.
year-plan, the guiding document for policy from its power sector. China’s thermal coal Chinese state media announced the deal
and industrial development from 2021 to use will increase and peak in 2026 at about 4.9 as part of the Belt and Road Initiative. This

Week 24 17•June•2020 www. NEWSBASE .com P15