Category Archives: coking coal

Political Consensus Grows Around The End Of Thermal Coal

For anyone still thinking that mining coal and burning it to provide heat or create electricity (that is, mining thermal coal) is a good way to make a buck, August 2015 was full of bad news.

First, Wellington’s Dominion Post newspaper said in an editorial that it was time for New Zealand to slash its coal use. Then, the same day, Genesis Energy announced that it would close the coal-fired power generators at the Huntly power plant by 2018.

No more coal at Huntly ... who'll be next to abandon coal?

No more coal at Huntly … who’ll be next to abandon coal?

But the writing was appearing on the wall even before these announcements. Not only had the thermal coal price dropped precipitately in response to the rise of renewable energy and environmental concerns in coal’s major markets, but there is a growing political consensus that thermal coal mining in New Zealand must stop.

This consensus does not yet include the National Government. While Energy and Resources Minister Simon Bridges welcomed Genesis Energy’s Huntly decision, and noted that it created further opportunity for renewable energy, he conveniently ignored the Government’s continuing subsiding of fossil fuel mining and use and lack of support for renewables.

The Green Party has long opposed coal mining, and now Labour and New Zealand First are, at least partially, moving in the same direction. In response to the Government’s statement that state-owned coal mining company Solid Energy might be facing liquidation, Labour Party leader Andrew Little – himself a former head of the coal miners’ union, the EPMU – drew a distinction between using coal for heating and power generation, which he agreed was on the way out (audio at 1:41), and using coking coal for making steel, which he said was “part of a green economy.”

New Zealand First’s Richard Prosser was similarly bullish on Solid Energy’s future, but both in his reported comments and in separate discussions with Coal Action Network Aotearoa, NZ First has drawn a distinction between coking coal and thermal coal. New Zealand First’s 2014 election policy calls for a progressive phaseout of coal:

The most effective way to reduce the build-up of greenhouse gases in the atmosphere (primarily carbon dioxide and methane) is to progressively phase out the burning of fossil fuels, especially coal, and instead use renewable energy eg wind-power, photo-voltaic electricity from sunshine, wood fuels, etc. (Climate Change section of NZ First Environment and Conservation policy)

When we met with New Zealand First, they advocated a similar position to the Labour Party: that is, they expressed continued support for coking coal, but agreed that it was time to move away from the mining and burning of thermal coal.

But while businesses and political parties are moving to end the use of thermal coal, there is one large New Zealand company which is bucking the trend – and that, of course, is Fonterra which, as we reported last month, has increased its coal use 38% since 2008 and plans a further major expansion of coal-fired milk drying plants. Fonterra’s low-value-add, high-energy-input business plan is coming unstuck as global milk prices fall. It’s time for Fonterra to take another path.

Though the political consensus is growing against thermal coal, Labour and New Zealand First are both continuing to back the mining of coking coal – that is, coal used for steel production – even though the coking coal price has also slumped, and burning coking coal is no better for the climate than burning thermal coal. You can read Cindy Baxter’s take on the shaky state of coking coal in her recent analysis of the state of play in the coal industry.

The message to companies such as Fonterra is clear: by backing the increased use of thermal coal, you are on the wrong side of history, the wrong side of science, and the wrong side of a growing political consensus.


Coal communities deserve better than the “boom and bust” coal industry

We at Coal Action Network have a vision for Aotearoa:  that we are coal-free by 2027.  We’ve arrived at this date as it’s when all the current coal mines in operation around the country will reach their end date.

Our new report released today.

Our new report released today.

It doesn’t include new mines such as Bathurst’s plans for the beautiful Dennison Plateau, where operations have stalled and 29 workers were recently laid off as the coal price has plummeted in the face of a global oversupply.

But imagine if the Government was to draw a line in the sand and state that there would be no more coal mines in Aotearoa.  If they did that today,  this would give coal mining communities the time to adjust, to plan a transition away from coal that involved the entire community, and led to a sustainable future. Continue reading

The real deal on Westpac’s coal funding

It's not to late to change banks in time for our week of action.

It’s not to late to change banks in time for our week of action.

When we started our campaign against Westpac because of its investment in Bathurst Resources, the company bit back.

No, no, we don’t invest in Denniston, they said.

We were investing in Bathurst before they were planning Denniston, they said.

The facilities we have with them relate to their existing operations, they said. Nothing to do with Denniston, they said.

While we have written to Westpac to clarify all of these points, we haven’t heard back.  They’ve gone silent, instead promoting their so-called sustainability.  But Bathurst’s half yearly report, released recently, is very useful and has provided all the information we think we need.

It certainly doesn’t tell us anything that would lead us to call off the campaign, as Westpac thinks we should.

The Bathurst report (page 18) goes into great detail on its relationship with Westpac  – perhaps in response to our campaign.  Here’s the detail on Westpac from that report:

“In July 2012, the Group obtained a finance facility with Westpac New Zealand Limited for the acquisition of a new mining fleet. The total amount available and drawn on the facility as at 31 December 2013 was $3.5 million.”

This new mining fleet is currently being deployed at the Cascade mine, just down from Escarpment (Denniston).  The thing is, Bathurst’s mining all it can out of Cascade, because it needs as much money as it can to fund the new mine. 

Will none of that fleet be used to take the beautiful Denniston plateau apart?  Even if it isn’t, all of Bathurst’s mines are being used to finance the new one.  So it’s a bit silly to claim they’re not related.

It’s also a bit silly to claim, as they do, that their investments in Bathurst were made before the company had made any plans to mine Denniston.  Bathurst’s whole entry into New Zealand was always all about Denniston and the coking coal up on that plateau.  They’ve bought up all the mines they currently own in order to get this new mine (and the next five mines next to it) up and running.

Next quote from Bathurst’s report:

 “In addition, the Group has with Westpac New Zealand Limited a term loan $1.2m, finance lease facilities $0.3m, and bank overdraft facilities which were unused at 31 December 2013.”

There are no caveats here about where this money from Bathurst’s term loan with Westpac should be spent.  Again, this is about Bathurst having enough money to keep going and start digging up the Denniston Plateau.

Right now the company is in dire financial straits, not helped by the low price of coking coal.  But it’s abundantly clear to us that Westpac is helping this company keep afloat through both loans: the $3.5million loan for its mining fleet and the $1.2million loan and the finance lease facilities.

While Bathurst has said this all-time low price of coal means they won’t start digging any up yet, (while laying off 29 workers), once it gets all the permits approved, it plans to start readying the Denniston Plateau for mining.

We have yet to find out whether this includes removing all the “overburden” [read: beauty, biodiversity], but, with Forest & Bird, have called on them not to do this and for the Minister of Conservation to hold back his permission.

We also note that the Buller District Council is getting very excited about the planning permissions being signed off. It looks like Bathurst may be clear of all the red tape pretty soon.

So it’s still a great time –  if you’re a Westpac customer who wants to do something about Bathurst’s plans to dig up a beautiful part of New Zealand for coal that will ultimately end up in the sky and contribute to climate change – to

Sign up to Make the switch!

It’s not too late to switch away from Westpac in time for our Week of Action beginning 7th April around the country.  So get switching people!

Final note: Westpac is also one of the banks propping up Solid Energy, who, along with Bathurst Resources, are both pretty shaky companies. You’d think they might learn that coal is a bad investment on so many levels.  Maybe they should follow the path of Bill Koch (younger brother to the infamous Koch Industries brothers), who is getting out of the coal mining industry because, in his words, it “has kind of died.”

Minister of Conservation should halt Denniston Plateau mining

Press release

The beauty of the Denniston Plateau.  Photo: Forest & Bird

The beauty of the Denniston Plateau that Bathurst may remove for nothing. Photo: Forest & Bird

Coal Action Network Aotearoa today called on the Minister of Conservation, Nick Smith, to not issue Bathurst Resources the DOC consent it needs to enter and operate its planned mine on the Denniston Plateau, in light of the company’s terrible financial state.

Bathurst has announced today that it is making 29 workers redundant and that it’s not going to mine coal at Denniston until international prices have recovered. However, it intends to go ahead and set up everything else on the plateau in readiness for mining.

This could include the removal of the “overburden” – the beautiful, biodiverse-rich landscape.

Continue reading

As Environment Court approves Denniston mine, all eyes on Westpac

UPDATE: Next Wednesday lunchtime in Wellington (13/11), help us tell Westpac to stop funding coal mining on the Denniston Plateau:


Press Release
In the wake of the Environment Court’s approval of Bathurst’s opencast mine on the beautiful Denniston plateau, 350 Aotearoa and Coal Action Network Aotearoa today renewed their call for Westpac Bank to drop its support for the mine.

Already, more than 800 people have sent letters to Westpac as part of the “Westpac dump Denniston coal” campaign, launched last week in Auckland. This week saw a temporary “climate change crime scene” outside a main Westpac branch in Wellington catching the eye of lunchtime passersby, and many similar protests are expected to roll out across the country in the coming weeks as the campaign picks up. Continue reading

Can We Make Steel Without Coal?

In this article, Jeanette Fitzsimons considers an issue with very important implications for both the coal industry and the prospects of making major greenhouse gas emissions reductions: whether, and to what extent, we can make steel without using coal. We welcome your comments and feedback – please send your responses to

Can we make steel without coal?

Coal is the most concentrated source of carbon dioxide and the biggest threat to the climate through accelerated global warming. Leading climate scientist James Hansen of NASA and Columbia University says that if we are to stabilise climate at a safe level the world needs to phase out coal burning to zero by 2030.

This is supported by analysis by Carbontracker and others that 80% of the known reserves of coal must be left in the ground forever if we are to limit warming to two degrees.

Coal Action Network Aotearoa (CANA) is committed to opposing all new coal mines in order to meet that target. However, 60% of Solid Energy’s coal production in NZ is for steel making, mainly for export, and the company says that “there is no way of making new steel without coal”.

If this is true, principled climate campaigners must either stop opposing new coking coal mines on climate change grounds, (Happy Valley, Denniston Escarpment, Mt William, Pike River) or propose a world with no new steel. (There are of course strong biodiversity reasons for opposing some of these mines but it is a different argument.)

Fortunately Solid Energy’s claim is not true.

Why is coal used to make iron and steel?

Firstly coal is converted to lump coke in a coking oven. A particular rank of coal, known as “coking coal”, is required to make the preferred quality of coke.

Then raw iron is made by reducing (removing the oxygen from) iron ore (iron oxide) by reacting it at high temperature with coke in a blast furnace. About half of the carbon in the coke combines with the oxygen from the iron ore to make CO2. The rest of the coke is burned in a blast of air in the blast furnace to provide the required high temperature; making more CO2. The resulting pig iron typically contains 2.5-4.5% carbon, making it relatively brittle and unsuitable for most uses.

Steel is made in a subsequent process as an alloy of iron and carbon (along with some other elements). Around 1% of the carbon from the coke remains in the raw iron to provide the source of that carbon. So coal (as coke) is a reducing agent, a source of energy to drive the process and a source of carbon to incorporate in the steel. Alternative processes need to meet all three functions. This is why you have to do more than just substitute a different energy source.

In New Zealand, the coking coal occurs on the west coast of the south island. The bitumen in the coal binds it into lumps in a coke oven. Coking coal is higher in carbon content than cheaper coals and lignite which are used in power stations and industrial boilers.

New Zealand’s Glenbrook Steel plant uses a different process. It is a unique design, developed to use NZ iron sands and sub-bituminous coal from Huntly.

What quantities are we talking about, globally and in NZ?

World steel production in 2011 was 1518 Mt and used 761 Mt of coal – 12% of all hard coal mined.

The Glenbrook plant (now owned by Bluescope) makes 600-650,000 tpy steel and uses 750,000 tpy Huntly coal plus 1,000 GWh electricity and some Natural Gas, supplying 90% of NZ’s needs. It also recycles steel.

Can we make steel with less coal?

For a start, we could recycle much more than we do.

Steel can theoretically be recycled indefinitely, with the remelting and alloying process ensuring its quality. That requires energy, but much less than to make new steel, and it needs no new source of carbon so is generally produced in electric arc furnaces. The current global rate of steel recycling is 30%, helping keep carbon emissions from pushing ever higher. Obviously there are limits to what can be collected for reuse but it should be possible to raise it to 80%, and would be if there was a sufficient price on carbon. Failure to price environmental damage leads to massive waste because collecting material for reuse is “just not worth it”.

The Direct Reduced Iron (DRI) process makes raw iron with inputs only of electricity and natural gas. India produces some 68MT/y by this method. If the electricity is renewable and the gas used is biogas from waste, this approach could be made sustainable. However DRI is often alloyed with scrap steel in the steel making step, so to add DRI to recycled steel complicates lifecycle analysis.

There are various processes that reduce the coal needed for a tonne of steel. The University of NSW has developed a polymer injection technology where some of the carbon and energy come from used car tyres, with 1 million car tyres substituting for 15,000 tonnes of coal. (1) This is useful while there are large quantities of used car tyres but is not a long term solution. Alternatively, the Hisarna process uses coal directly rather than making coke, reducing coal input by around 20%. (1)

The steel industry worldwide is putting serious effort into finding ways of reducing carbon emissions from steel making – within the current economic framework. But we are looking for something that could replace coal altogether.

Is it technically possibly to make steel without coal?

The obvious answer is that it must be, as early iron and steel production used wood-derived charcoal instead of coal-derived. However the scale of today’s industry is vastly bigger than two hundred years ago.

Electrolysis has been shown to be capable of coal-free steel production but the technology is said to require another 20 years of development before full commercialisation. (1) However, this is roughly the time it will take under Hansen’s scenario to phase out coal directly, making it a possible option for the future.

Charcoal made from wood or other biomass can provide the reducing function, a source of energy and the minor carbon component in steel; with further heat obtained from electricity or natural gas (or biogas). However, even the small quantities of iron and steel made a couple of centuries ago, along with the heavy demands of ship building, had a serious impact on Europe’s forests. The scale of steel demand is now many times greater, so the real question is about scale and sustainability. Climate change cannot be considered in isolation from land use, food production, and forestry policy.

Is there enough wood or other biomass, and where would it come from?

Wood could be grown in plantations for use in the steel industry, just as it is now grown for timber. But land is a limited resource and is also needed for food and buildings and for the protection of wild nature and other species. There have been various attempts to calculate how much land you would have to devote permanently to rotational wood harvest for each tonne of steel to be made annually. The estimates vary between two and seven hectares per annual tonne, depending on species, climate, soil and process efficiency. Clearly the world is not going to devote 2-7 billion hectares (13%-50% of the global land area) – or even a small fraction of that – to steel making, and nor should it.

However, all existing forestry operations have residues of woody material of low commercial value. As well as prunings and thinnings, harvesting residues like branches, bark and damaged logs average at least half the tree. Woody waste from crops – such as coconut shells and husks, corn stover, grain stalks – can be added to this.

Figures from the Food and Agriculture Organization of the UN (2) estimate annual waste from commonly cultivated crops is in the region 25-176 exajoules (Ej – 1018 joules). Parikka (3) estimates annual waste biomass from all sources is around 64 Ej and compares this with total global energy use from all sources for all purposes of 440 Ej. For comparison, global coal use for steel making is around 22 Ej. (5)

Carbonscape, a NZ firm which has developed new very efficient technologies using microwaves to process wood waste into charcoal, calculate that with their process it would take 1.6BT biomass globally to replace all the coal currently used in iron and steel making. That is around 3% of the 50 B tpy of world annual biomass productivity. Carbonscape is not yet in commercial production but has produced test batches of charcoal to secure an order for 9,000 tonnes from NZ Steel.

While these numbers are far from precise they do indicate that far more waste biomass than needed is available. Of course, not all waste can be easily recovered; some of it will be too far from steel mills to justify the transport energy and cost; some of it already has alternative uses; and the green leaf and twig waste (a small proportion of the forestry total and probably more of the crop waste total) should remain on site to return nutrients to the soil.

However, the most important question is whether the forestry and other biomass operations on which steel making might piggy-back, should all continue.

Are the forestry operations that produce the residues themselves sustainable?

Brazil produces some 23-36 million m3 of biological charcoal each year to make iron and steel. Some of it is from planted woodlots on a 7 year rotation but most is from old growth forests. There is a major international campaign to stop this logging of old growth forests to supply the steel industry.

Much logging in tropical countries is actually illegal as well as unsustainable and the world’s old forests are diminishing fast, along with the wildlife and indigenous communities they sustain. We cannot both campaign against cutting forests unsustainably, and rely on residues from this practice to fuel our steel mills.

If a plantation forest is managed well, using its residues for energy and carbon is a big environmental plus. But how is the steel maker (supposing they even care) to tell the difference between charcoal from sustainably managed forests, and that from illegal and unsustainable cuts? It seems impossible.

Yet there is already a world wide system in place to do just that for timber, paper and packaging.

The Forest Stewardship Council (FSC) certification system operates in 80 countries and five continents. It certifies that a product comes from a forest that is legally harvested and well managed with regard to environmental protection, wildlife conservation, and safe and fair working conditions. It also outlaws genetically engineered trees, citing risks of increased flammability, invasiveness and contamination of native forests with engineered traits.

Forests may be planted or well managed natural forests where high wildlife densities and populations of animals like great apes and tigers, are retained.

Globally 165 million ha of forest are certified, and this number is growing fast. The system includes chain of custody certificates in 105 countries so a product can be tracked through the value chain. NZ has 1.4 million ha under certification. Currently the system is not applied to residues but there is no reason why it should not be and there is some reference in the literature to extending it to residues for biofuels.

A similar area of forest is certified under the parallel certification system, PEFC. The two systems are gradually converging.

Is the wood residue in the right place?

Handling, drying and transport are major costs to recovering wood residues for use. However, if it is planned right the forestry industry already has much of the equipment needed on the site, and removing waste can be a bonus for an industry which otherwise has to work around it or burn it.

There are many different logging practices, some of which make it much easier to recover the residues. Practices such as taking the whole logs to a skid site, cutting and stacking at the time of logging, and the use of mobile chippers can reduce costs. Carbonscape says their micro-wave charcoal technology lends itself to small scale units for decentralised processing in the forest. A NZ wood fuel supplier says the energy required to haul a truckload of dry chip regionally is equal to only about 4% of the payload.

Some residues will of course be on steep inaccessible slopes, in areas too remote from steel mills. It is beyond the scope of this paper to estimate how much of the globally available wood residue might be harvested for making charcoal.

Other advantages of wood over coal

A wood-based process is much cleaner, with no sulphur or mercury emissions, low oxides of nitrogen, no toxic coal mine tailings, less ash which is not a toxic waste, less slag to dispose of, and less lime needed because charcoal is basic rather than acidic. It is claimed there are fewer industrial accidents than with underground coal mining.

Because of these side benefits, the Norwegian ferro-silicon industry is willing to pay twice as much for wood charcoal as for coal (per unit fixed carbon) for smelting.

What are the big obstacles?

Leaving aside the biggest issue, which is total lack of political will or interest in climate change as a problem, there are two issues which need to be addressed.

The first is scale, as it is for all sustainability questions. The capacity of the atmosphere to absorb carbon is not the only limited resource. Constantly growing steel production within an infinitely expanding economy will very soon run up against limits of land and water to produce biomass. These limits are not an argument to continue using coal – itself a limited resource – as to do so will change the climate and destroy many other resources. Steel making can continue in a sustainable society without coal, but on a limited scale.

The second is price. As long as coal pays nothing for its contribution to climate change, sustainable alternatives will be more expensive. (Under NZ’s ETS, coal mining for export pays nothing for its carbon emissions, either here or in China, India, or Japan, our main markets.)

A serious price on carbon without loopholes, preferably internationally co-ordinated, is necessary and urgent if steel making is to move away from coal. Necessary – but not sufficient. If a price on carbon is all that occurs the world’s forests will be raped to supply the steel industry. So controls on forestry are needed too. A requirement that all steel fuel come from FSC certified forests or sustainable agriculture would do it.

How much steel do we really need?

In a sustainable society steel use, like everything else, will be moderated. The first and easiest step is to cut out waste. When the rate of building new infrastructure stabilises and we are not constantly building more bridges and high rise short-lived buildings, demand for steel will drop. Design for durability and repair will play a part. There are also materials that can substitute.

Steel framework in up to 6 storied buildings can be replaced with pre-stressed laminated timber, a process developed at Canterbury University. They then become a store of carbon rather than a source of emissions. (However, a small amount of steel is used in a strengthening rod and end caps).

What do we need, to create a sustainable steel future?

First, a substantial price on carbon. That will help drive the wood based technologies and recycling. A recent Otago University thesis estimates that even $50/tonne would be enough to drive all technically feasible boiler fuel substitutions of wood for coal. (4)

Second, we need good resource studies and mapping of the wood residue resource, along with improved harvesting techniques and equipment. Scion is doing some of the former.

Third, we need to expand the FSC and make certified residues mandatory in this country. There are moves towards that overseas.

Once these are done we need a national strategy on the priority use of wood residues. Transport fuels, boiler fuel and smelting fuel are all likely to compete for the available wood and allowing the market to sort out what we use here and for what, and what we export, risks very perverse outcomes. (For example exporting charcoal might be more profitable but if it leaves us without transport fuel at home could cripple our economy.) It is inexcusable that no government has embarked on this work, or even plans to.

Most of all though, we need a change of mindset, where climate change is recognised as serious enough to change our way of doing things, and to learn to prosper within the limits of the biosphere.


This brief survey has not attempted to quantify the amount of steel needed to run a stable society, nor the quantity that could be made sustainably without coal, nor the quantity of wood residues that are available, easily harvestable and close enough to steel production sites, though some ballpark indications have been given. Work on refining this is urgent.

However we can conclude that it is quite feasible to make steel without coal and in some places it is already being done.

If wood or other biomass residues are used instead of coal, the main limiting factor is the quantity of residue from sustainably managed forests or cropping. Ultimately the limiting factor is land and land use competition. The FSC certification process could be used to ensure that wood residues are sustainable. Although the quantity is limited, it is large.

The current world production of steel, let alone its constant expansion, is not sustainable, but in a stable state economy a mix of substitution, much greater recycling and the use of biomass residues instead of coal can enable steel production to continue.

A sufficient price on carbon is essential, along with further quantification of the availability of wood residues and the development of more efficient technologies to enable this.

Most of all we need a change of political will to prioritise action on climate change and end the mad rush for growth at all costs so that these options are pursued.

What is clear however, is that there is no case for soft-pedalling our demand that no new coal mines be opened.


1. Croezen, H and Korteland, M, A long term view of CO2 efficient manufacturing in the European region CE Delft 2010



4. Deller, Nic, Replacing NZ’s Coal Consumption with Energy from Wood Residues: a feasibility study B App Sci dissertation, EMAN 490 Otago University 2012

5. World Coal Association Coal and Steel Statistics 2012