B.C. and Canada Michelle Mondeville Director of Communications and - - PowerPoint PPT Presentation

The Economic Importance of the Coal Industry in B.C. and Canada Michelle Mondeville

Director of Communications and Stakeholder Relations, Coal Association of Canada

Canadian Coal Mines

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Coal Production (2011)

• Almost 68 million tonnes of coal produced
• 27 million tonnes (40%) mined in B.C.
• 89% of Canadian MET coal production in B.C.

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Province

• Met. Coal

Thermal Coal Total BC 9 1 10 AB 2 7 9 Sask

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3 NS

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Production Volumes and Coal Prices

• 2011 was a historical milestone
• total value of Cdn. coal production reached $7.0 billion
• a three-fold increase from $1.6 billion in 2001
• represented 22% of total B.C. exports
• $1 billion in capital investment
• Prices for thermal and metallurgical coal increased at a

strong pace between 2008-2011

• annual average growth rate of 15% over past 10 years
• depressed prices since
• Longer term prospects promising again

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Coal Prices

Impact of Coal Production on Our Economy

• Coal industry contributed an estimated $5.2 billion to

Canada’s GDP and $3.2 billion in B.C.

• Total Cdn. coal export sales reported at $8.0 billion
• over $7.0 billion in B.C.
• Coal exports grew over 300% over the last decade
• 16% average annual growth rate

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Impact of Coal Production on Our Economy

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• Canada the third largest exporter of MET coal after Australia

and the U.S.

• Major buyers of Canadian coal:
• Japan (27%)
• South Korea (24%)
• Europe (16%)
• China (10%)

Employment

• Coal employment (direct and in-direct)
• 42,000 people across Canada
• 26,000 people in B.C.
• Many are highly skilled workers
• Average coal industry salaries over double the average

national wage and amongst the highest in the mining sector

• Salary rates increased 37% over the past 10 years.

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Government/Community Contributions

• Government Revenues
• 2011 tax payments made by the coal mining industry to all levels of

government were $715.2 million

 $399 million in tax revenue generated by economic activity  $316.2 million in mineral taxes paid to the B.C. Government

• Payments to governments support public infrastructure, such as

roads, hospitals, schools and programs, which contribute to our well being and quality of life

• Coal companies and employees also actively

involved in contributing to local communities

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PwC Reports…..Bottom Line

Canada and B.C. would be disadvantaged financially and socially without the coal industry - all facets of the economy benefit from a thriving coal industry

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What does the future hold for met coal?

• Global steel production has grown strongly since 2000
• WCA predicts 3% growth in steel markets in 2013/4
• A significant amount of steel is needed for the future.
• Emerging urbanizing economies will need steel for

infrastructure, housing and transportation

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What does the future hold for coal?

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2010 2015 2020 2025 2030 2035 China 150-300Mt India >400-600Mt Indonesia >100-150Mt Other Asia >80-150Mt Africa >>400Mt Other >100Mt “The path expected for emerging economies as they urbanise is likely to lead to a intensity per capita of around 350- 450kg as limitations on land require further increases in building height. Don’t forget China is not finished yet and India and others have not really started!” – Neil Bristow

Canadian Coal’s Strategic Advantage

• Canada outperforms peers on met coal margins
• Growing port capacities
• Proximity to fast growing Asian economies
• Reliable alternative to large Australian and Indonesian

thermal coal suppliers

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Canadian Coal’s Strategic Advantage (Ports)

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Canadian port capacity and throughput (Mt)

10 20 30 40 50 60 70 80 2 4 6 8 10 12 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 Million tonnes (exports) Million tonnes (change in capacity) Westshore Ridley Island Neptune Canada East Texada Island Total exports* Historic Shipped Tons Metallurgical coal export demand

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Canadian Coal Challenges

Criticisms of coal

• Myth: Coal isn’t safe
• Fact: Thousands of people (mine workers to train operators to

terminal operators) work at coal sites without issue

• Myth: Coal is toxic
• Fact: Coal is not classed as a dangerous or hazardous material by

Transport Canada. It’ s not on the International Agency for Research

• n Cancer’s list of carcinogenic agents. Nor is coal carcinogenic to

humans

• Myth: Coal exacerbates climate change (and industry should

be shut down)

• Fact: Coal is critical for developing nations to rise out of poverty; to

support economic development and growth

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Coal is essential for developing nations

• 1.3 billion without electricity
• Coal – reliable energy where it is most needed
• India – 70% of electricity comes from coal
• 300 million in India have no electricity

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Setting the Record Straight

• Coal Alliance Member
• coordinated public and media outreach
• web and social media

 Website: coalalliance.ca

• Vote Mining: Raised the profile and importance of mining

during the recent BC election

• candidate outreach
• Public education
• web and social media

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Conclusion

• Canada would be disadvantaged if we didn’t produce and sell
• ur coal - from the contribution to GDP, trade balance, jobs

and communities….coal positively impacts all facets of our economy and society

• Share your knowledge of the coal industry and the important

contributions it makes locally and globally

• For more information:
• Download our PwC Reports at www.coal.ca (see Resources)
• Follow us on Twitter
• Attend our conference (Sept, 2014 in Vancouver)

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Thank you!

Michelle Mondeville Director of Communications and Stakeholder Relations Coal Association of Canada mondeville@coal.ca 780.993.6651 (cell) www.coal.ca

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