Peabody Energy form joint venture with China's Shenhua Group

By Nicel Jane Avellana

Dec 19, 2013 05:27 AM EST

St. Louis, Missouri-based Peabody Energy formed a joint venture with China-based Shenhua Group. Peabody Energy is the biggest private sector coal company in the world serving metallurgical and thermal coal customers in over 25 countries in six continents. It leads in sustainable mining and clean coal solutions around the world.

The Shenhua Group, meanwhile, is the biggest coal company in China and the largest coal distributor globally. With its foundation in coal, Shenhua's operations include electric power, port, railway, shipping, coal-to-liquids and coal-to-chemicals. The company engages in production, transportation and sales and has over 65 million kilowatts of power generation capacity installed as of November this year.

In a joint statement, the two companies said the joint venture will create Sino-Pacific Coal Trading Corporation Pte Ltd. The 50-50 joint venture company "will supply Shenhua's growing coal import demand with thermal coal from Peabody's global production and coal trading platform," the statement said.

Christopher J. Hagedorn, Peabody Energy President- Asia and Trading, said the partnership represented an important milestone in the company's growth strategy. Hagedorn said, "Globally, Shenhua is one of the world's largest importers of thermal coal and this important partnership will give Peabody a priority position to supply Shenhua's growing import needs with coal from Peabody's expanding global platform. Annual world coal demand is expected to grow by 1.2 billion tonnes in the next five years, with more than 80 percent of projected global demand growth in China and India. Over the last decade, Peabody has been reshaping its global platform to better serve this high-growth region."

Sino-Pacific Coal Trading Corporation is set to start operations next year after regulatory evaluation. The coal will be sourced from key supply basins in the world so it will be able to provide Shenhua with thermal coal for its subsidiaries in China.

© 2024 VCPOST, All rights reserved. Do not reproduce without permission.

Join the Conversation

Real Time Analytics