Coal Reserves Will Make China 'New Middle East'

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"We should be doing what they are doing."

China's coal


Vast reserves of coal in the far west of China mean it is set to become the "new Middle East," a leading figure in the global coal industry has claimed. Fred Palmer, the chairman of the London-based World Coal Association and a key executive at Peabody Energy, the world's largest privately owned coal company, also said that China is leading the US in efforts to develop technology to "clean" coal of its carbon emissions by burying them underground.

In a wide-ranging interview with the Guardian, Palmer dismissed the idea that the world might ever experience "peak coal"—the point at which maximum global coal production rate is reached. "The Dakotas, Mississippi, Alabama, Louisiana, Texas all have large, large amounts of lignite [brown coal]," he said. "Or in western China and Mongolia you have lower-ranked coals. So I don't think there's a peak coal problem. I think Xinjiang Province in the west of China, where they say there's a trillion tons of resources, will be the new Middle East. Anyone who has the notion that we're going to move away from fossil fuels just isn't paying attention."

China is "ahead of the U.S." when it comes to developing low-carbon coal technology, said Palmer, and "we should be doing what they are doing." This weekend, the Chinese government announced a new five-year plan, which included a pledge to reduce emissions growth relative to GDP by 17%. Palmer added that the world should "applaud" China for consuming so much coal "because it makes the world better for everyone for no other reason that it takes huge price pressures off of oil." China processes a significant amount of its coal to produce liquid fuels, which can be used as an oil replacement.

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