Adaro eyes $291 million from unit IPO to spin off coal arm
Adaro is spinning off the coal mining unit valued at $2.45 billion to focus on developing cleaner energy, with an aluminum smelter being built in Kalimantan.
The US coal industry is beset by job losses, mine closures, bankruptcies and a dearth of new builds as it struggles to compete amid tough new environmental regulations and competition from natural gas.
US coal miners are also being hurt by a declining steam coal price below $100 compared to a high of $190 before the financial crisis hit in 2008 and limited export capacity.
According to the latest stats from the Energy Information Administration (EIA), coal-fired power stations represented just 35% of US electricity last year — a rapid decline from the roughly 44% in 2011.
Platts reports New York Mayor Michael Bloomberg speaking at an energy conference sponsored by the Dept of Energy said the US coal industry is a “dead man walking”:
“Even though the coal industry doesn’t totally know it yet, or is ready to admit it, its day is done. It used to be said that coal is king, and regrettably coal remains king in nations like India and China,” Bloomberg told a US Department of Energy-sponsored advanced energy conference near Washington.
“Here in the US, I am happy to say, the king is dead. Coal is a dead man walking,” he said.
RELATED:
