 Good afternoon. Thanks for coming to this new or relatively new CSIS building despite the weather and Today we're very pleased to host Mr. Keisuke Sadamori. He's the director for energy markets and security at the International Energy Agency, which is based in Paris And he's here to present the IEA's mid-term coal market report. This report is part of the IEA's mid-term report series and it gives us a IEA forecast on coal markets for the the coming five years as well as an In-depth analysis of recent developments in global coal demand supply and trade You already have his bio in front of you, but I will just give you a very Brief version of it. Mr. Sadamori has been with IEA since 2012 and he monitors Things other than coal, I mean global oil markets and also energy supply Situations prior to joining IEA. He was He was with the Minister of Economy Trade and Industry of the Japanese government and he has held various important posts including his position as the executive assistant to the Prime Minister in 2011 when the great great East Japan earthquake and tsunami hit Japan, which as you may know triggered a Fukushima nuclear plant accident And he has he has also been the Japanese representative to numerous international energy fora Including IEA governing board. So without further ado, please Share your insight. Thank you Thank you very much Miss Nakano for the nice introduction and yes, the my name is Sadamori. I'm from the IEA I'm the director of the the energy markets and security at the IEA so my responsibility is the the emergency response, you know emergency preparedness and the oil market monitoring as well as the the the market analysis of gas coal power and Also recently the renewables because a renewable is no longer about the R&D story But the actual deployment and in some regions that they are already competing with the other fossil fuel sources without any subsidies So so that's what I do at the at the IEA and also it's nice to be Back to this town because I used to work at the embassy in Washington and that's More than 15 years ago, but the so I was here as the embassy staff from 1998 through 2001 So it's always a pleasure to come back to the city because the this is where the action is in terms of the various Policy issues now. Thank you very much. Ladies and gentlemen So it is a pleasure for me to present the IEA is the Middleton coal market report in 2013 as explained by the moderator, so this is part of the medium-term market reports on oil the gas Renewable and coal and we just launched this last month At the IEA and now this is my first time to be to be presenting this at this Washington and now There's no denying the controversy reality of coal and its dominance of power generation worldwide So no fuel draws the same higher particularly for its polluting quality is both locally and in terms of the CO2 emissions and Yet no fuel is as responsible for powering the economic growth that has pulled billions out of energy poverty in the past decades So as we look to the long term we must ask what role coal Has to play in the energy mix That we want to achieve because there will be a role But without the mitigating the polluting effects of coal the pursuing business as usual will have an enormous tragic consequences So before going to the specific findings of the a medium-term coal market report 2013 Which covers five years towards the 2018 let us take a look at the longer-term perspective based on the the other Flagship publication of the IEA, which is the world energy outlook 2013 which covers the year toward the 2035 now Here is the the world energy demand by fuel from 1980 to 2035 long outlook and you can see easily that the Coal has grown fastest among the old fossil fuels all field sources not only fossils in the first ten years of this century and And this is mostly coming from the very rapid growth of China and the future outlooks toward the 2035 that's in the dotted line and This dotted line is based on the NPS new policy scenario Which is the central scenario of the world energy outlook and which assumes the continuation of the existing policies and Implementation of the policies that have been announced by governments but are yet to be given effects So in this NPS coal will grow at a solid base in the near future, but not Faster than other field sources, but the But it depends upon the which scenario in the wheel that you look at so for instance the 450 ppm scenario which is shown in the green bar Which shows that The 450 ppm scenario shows what it takes to set the energy system on track to have a 50% chance of Keeping to a two degrees Celsius in the long-term increase in the average global temperature In this case coal consumption must go down drastically and only gas Is allowed to grow among the fossil fuels On the other hand under the CPS current policy scenario which only takes into account the policy already exists and The coal will overtake oil and we will continue to grow as the largest fuel Source toward the 2035 So if we take the current policy scenario the future outlook in the last slide would be different So coal will overtake oil demand around the 2020 Which would be similar to the project projection in the medium term the market reports So the I will show this to you later So therefore like it or not the coal is here to stay for a long time to come Another fundamental point about coal is that it is abundant and the geopolitically secure Even in the old sector recently the high oil prices and the improvements in technologies like fracking have enabled the production levels are formally unseen Overall the remaining energy sources around the world will not Constrain the projected energy demand in the foreseeable future, but among such fossil fuel sources abundance of coal is Outstanding and as you know the majority of coal is used for the power generation and The iron steel production is the second largest use of coal but that represents around five percent of coal use and The outlook for the power generation in known OECD countries coal will continue to be the dominant generation fuel Coal power plants are easily integrated into the existing power systems and modern plants Very flexible So providing affordable base load factor while backing up the variable renewable generation as well so The This is the the about the world energy outlook the entire global picture, but energy demand growth will be led by China and India and other Asian countries and for the next decade China will be the main driver of the global energy growth and Especially in the world of coal China is dominant China has half of both the Global production and consumption of coal So in China the scale of coal in the economy is simply incomparable to fuels Elsewhere so replacing coal with gas in Chinese power generation would require Twice the volume of all global energy trade So coal therefore continues to play an important role in the economic growth and energy security worldwide and after 2020 to toward the 2035 it would be the India who would lead the global coal growth Instead of China, which would drastically slow down now I Need to add that it is not only China and India the there's another publication by the the IEA which is the world energy outlook Southeast Asia energy outlook. So this was released Last September I guess yeah September at the time in the margin of the the ASEAN energy ministers meeting and According to this outlook The if we continue the current path the ASEAN's generation will generation mix will see a drastic change So coal-fired power generation which currently generates around 200 terat hour. That's about a 30% of the entire generation in 2011 will grow to more than 400 terat hours in 2020 and More than 900 terat hours in 2035 that would be the growth of 6% per year and that and as a result in 2035 the coal will take about half of the entire generation in that ASEAN region On the other hand the gas-powered generation will increase modestly by around 2% annually, so the the gas power generation will lose its share from 44% in 2011 to 28% in 2035 I Need to add that the more than 70% of the coal power generation built Under construction in this region are of subcritical type which is the inefficiency of low efficiency type of the power generation plant and That leads to the point that coal in its current Form is simply unsustainable So coal-fired heat and power generation is the biggest single source of carbon dioxide emissions resulting from field combustion today And more than three-fifths of the rise in global CO2 emissions since 2000 is due to a burning of coal to produce the electricity and heat and We should not overlook the health problem tied to the local pollution produced by the coal combustion and As you can see in its slide the majority of the new CO2 emissions are coming from the non-OECD countries And even on an accumulated basis since the year 1900 Non-OECD would reach almost the same level as the the OECD countries in 2035 Even though we have known how to build efficient super Critical ultra super I forgot the the kind of a very high efficiency co-fired power plant since the 1960s Most of the co-plans built since then and the large proportion of ones are being developed today In particular in the non-OECD areas are of that inefficient subcritical kind if these Subcritical plants under development in India and ASEAN states Including the Indonesia were completed with the latest Existing technology it would save as much CO2 as would be saved by all the wind turbines in Europe So when it comes to the sustainable energy profile We are simply off track and the coal in its current form is the prime culprit Yet with coal set to remain an integral part of energy mix for the decades to come the challenge is to make it Cleaner and more efficient So what I stated above is the long-term perspective as a background to this medium term coal market report And now let me move on to the findings of the a medium term coal market report 2013 We released this in December last year. So this is a book Now this slide serves on the line the point that not only Coal is here to stay but coal demand growth is also not showing any signs of stopping Over the next five years additional coal production capacity over half million tons per annum Will be added worldwide each day and that will be necessary to meet the worldwide demand increase of around 2.3% per year on average until 2018 Every year the coal continued to grow more than oil and gas. So in 2012 China and the United States had abnormally low coal consumption And I will come back to this point later in the presentation But even with this abnormal drop in the growth in China and in the United States The coal grew more than oil and gas If nothing changes a coal will catch up with oil as the world's biggest primary energy source in the foreseeable future and nobody can be surprised in accordance with the recent trends and in 2012 China surpassed the rest of the world in coal consumption and this is in energy terms not in terms of physical tons and What is remarkable is that the growth in China is projected to be much lower than it used to be So we assume strong economic growth in China However, our projections for the Chinese coal growth are much lower and that's 2.6% per year on average And this gap comes from the efficiency both in the production and consumption of the electricity diversification away from coal in in non-power Sector all around the economy and the rebalancing to a less coal-intensive economy Now on the other hand the coal conversion emerges as a as a demand driver with potential to increase the coal demand and I will also come back to this point later and So this is what happened in China in 2012. So coal demand growth in China in 2012 Was only a 4.7% and that's the second lowest in the decade Comparing the his cold historical trends with the 2012 we noticed that the three factors that could explain the low coal demand growth in China of 2012 and the first the GDP growth was 7.8% in 2012 And that's lower than the average in the with the past trend over the last decade China has grown over 10% per year on average Second the elasticity of power in relation to the GDP was 0.74 and This is the third lowest level in the decade with an average of one point one. So that's the little yellow or green. I don't know. I mean and So the third in 2012 the hydro production in China was 23% higher than in 2011 So almost all the extra hydro production Resulted in less coal power generation If we turn this is the OECD the coal demand outlook So if we turn to the OECD OECD Outlook to the 2018 the general trend is flat But the picture at the regional level is more nuanced. So in the United States, which is the blue line The demand will largely depend on the coal and gas price evolution. So Another important factor is the retirement of the coal fire plants and which will be more important in 2015 due to the mercury and the air toxic standards taking effect in January at the beginning of 2016 in Europe, which is a red line The coal gas and CO2 prices are expected to continue to give a cost competitive advantage to coal over gas But we consider that the most of the gas to coal switching has already occurred and The slow economic growth and more renewables will drive out the thermal generation production So significant new coal capacity are expected in Germany and Netherlands But there will be also be the significant retirements In both countries and in others especially in the United Kingdom and therefore so so We don't we don't believe that the coal will continue to grow in Europe. It will Finally decline slowly But in Asia high gas prices and concerns about the nuclear power generation plant will make the coal plants Run at the high load factors. So we expect solid growth in OECD Asia, Japan and Korea All in all the OECD coal demand in 2018 is focused to be about the same as it was in 2012 So the we saw in the latest last slide that in OECD countries growth in Asia offsets declines in Europe and US And here we see the most of the coal demand growth comes from Asia also in the non OECD countries So this is moving trade on the center of gravity Towards east which impact on the price setting as well now Let let us see but who is more coal dependent and if we take a look at the coal consumption on a per capita Basis for the power generation We might be surprised to see how per capita consumption in places like Australia United States and Germany is bigger than in China and Actually China and Denmark's per capita Coal consumption are quite close and on the other hand we can also see that the low level of per capita consumption in countries Considered as the coal places like India and Indonesia now so But it is not only in Germany and Denmark that depend on coal in Europe The with cost advantage of coal over gas as I said the European countries Germany Spain UK increase the coal consumption in the last few years some call it the golden age of coal in Europe, but but the but that Cost advantage of coal in Europe is nothing comparable to the cost advantage of coal in Asia region so this slide shows the price of coal and that's in dark blue the lower line and Gas that's in red the the higher line and the purple bars Indicate the co2 prices necessary to make gas as competitive as coal Taking to account only the variable costs Because given that the new investment decisions cannot materialize within our outlook, you know medium term outlook period We do not consider the capital costs for this comparison. So this is purely about the fuel switching in short term If we consider the capex factors then the price would be lower, but still significant and it is evident that the why Coal plans will work at high load factors in Japan and Korea and This break even carbon cost so to say is currently around 140 or 150 US dollar per ton and You know that the the common prices in Europe right now is Less than five euros or in the US dollars. That'll be seven dollars probably per ton of the CO2. So so you can see that this 150 dollars per ton is something not possible in the foreseeable future and In order to give the scale of how this impacts on the electricity prices this $150 per ton would translate to around $50 per megawatt hour or five cents per kilowatt hour for gas and 125 dollars per megawatt hour or 12.5 cents per kilowatt hour for coal. So you can see that the kind of a level of impact of this level of carbon pricing comes in order to make the coal and gas the equally competitive Now let me talk about a little bit about the coal trade and that's growing faster but moving east and in this map the countries in blue they are the exporters and the the green countries are some of the significant the importers and What this chart shows your projections for the thermal coal trade in 2018 so the Pacific Basin has two biggest exporters as you know the Indonesian Australia as well as the biggest importers China Japan India Korea and Taiwan therefore it concentrates most of the seaborn trade with increasing share in the Atlantic Basin on the left-hand side The Columbia and the United States are the main exporters with the European receiving most of the coal South Africa and the Russia they are the kind of a swing suppliers and Increasing their sales to the Pacific Basin, so especially countries like South Africa They used to ship most of their coal to the European countries, but now it's more and more moving toward the Pacific side providing even to the countries like Japan so So so the those thermal coal trade continuous movies and that would have a kind of impact on the The price setting in the global trade on the supply side the main expansions take place in Indonesia and the Australia About the prices The we see in this chart how prices have shown a declining trend in both steam and the metallurgical coal Steam coal prices for example declined from over 120 Dollars per ton to below 80 dollars per ton and that's a 35% decline So both steam and metallurgical coal prices are in the low part of the traditional boom and bust cycle and mostly coming from the current over supply The chart at the bottom. I'm sorry. It's a kind of small one so This one shows how the fossil fuel prices have evolved since 2005 and we can see that the oil prices and now 2.5 times What they used to be in 2005 and gas prices in Europe But twice what they used to be and cold but coal prices are almost the same as the 2005 levels and Of course, this story would not be complete without the gas prices in US and that's in red and Which is a lot lower compared with the year 2005 So although the coal demand is not so price elastic In some regions of the world, but it is obvious that the low prices would mean Would lead to the the higher demand of coal now We often hear that the shale gas production in the United States is driving Coal prices down in Europe and worldwide and Yeah, indeed the shale gas was one of the reasons but not the only one For instance, the US winter of 2012 was mildest one in decades so it's a lot warmer than this year obviously and Leading to the lower gas demand for the heating and thermal generation So this caused the high gas inventories in spring 2012 With Henry have gas prices at the time breaking the level of about two dollars per million BTU and This is a very well-known story, especially in the United States and this decreased coal consumption That's equivalent to the around the 200 terat hours which from coal to gas from 2011 to 2012 The thermal coal exports from the United States increased But if we put this in perspective, we see that the expansions occurred in all those big countries Especially Indonesia and Australia So therefore we need to consider that the US only was only a kind of a part of the current oversupply now the one point about the United States is that the The picture what happened in the United States in 2012 is not complete if we do not mention this coal file plants retirements Over 10 gigawatt in 2012 mostly driven by the EPA regulations of our decommissioned and Even if the retired coal power plants are usually the old and efficient ones and hence with low load factors there's an impact on the cold demand of course and As mentioned before that we expect the big retirements again in 2015 as the new standard on the mercury in an air level is enforced since the first of January in 2016 There's a kind of misconception On the US coal that all coal which was not consumed in the United States was simply exported to Europe In this chart, I'm sorry. It's a bit hard to see but in this chart we can see that the caulking coal exports were flat in 2011 and 2012 that's a red part almost the same height and Only one quarter of the 100 million tons of decrease in coal demand in the United States was exported So out of a 100 less coal demand in the United States around the 26 million tons So about a quarter were exported and that was mainly to the Europe. Sure so now so So that that's shown in the in this the change of the thermal coal exports So we have seen a little bit of increase but that that's not all so So so the coal not used in the United States did not go to Europe So the question is where did it go and we have seen the various the newspaper reports about this thing is that Well, it's actually the US cold the So this is the answer. I mean the so the industry had to face the the overcapacity and Had to reduce the production. So they are still Remain remaining under the ground so the The the so they had to reduce production by around 70 million tons as we saw in the last slide So this has produced a significant loss of jobs, especially in regions like Kentucky or West Virginia So the job creation in shell gases implication in other sectors Of course, this is part of the economy but but but but I think that we should be aware of this and The the coal market in the United States is rather complex with the majority of long-term contracts and sophisticated logistics But in a simple analysis, we see that the central Appalachian and the powder river basin accounted for most of the decline Whereas it seems logical that the central Appalachian Central Appalachian regions are probably the highest cost region in the United States suffered a big cut We think that the powder river basin as a lowest cost Lowest cost coal in the United States is more related to some of the retirements shown in a few slides ago the so without the dissolved for occasion units and hence Consuming the low sulfur coal from powder river basin. So there are there are mostly a big decommission and retired so that's the reason why the The powder the powder river basin coal has been hit in recent years This is about the Chinese are the the the coal conversion So we used to consider that the coal to liquid and coal to gas Kind of conversion has been considered, you know, they were non-economical But nevertheless, there are a few considerations that we should we should take into account now and first the yeah, of course that the coal to liquid and coal to gas conversion is expensive, but Now we are seeing the very high prices of oil and gas, especially in the Asian region Secondly the coal to gas or the coal to liquid processes that they're ideal for the stranded Coal in China, especially that is the coal that is a low cost But low quality and far from the demand centers and third Especially the coal to gas conversion with pipeline networks if it works could address a problem of rail transport of coal in China So during the next five years the coal gasification will contribute more to the China's gas supply than shell gas While there are many uncertainties about these technologies the potential scale of projects in China involving coal to produce the synthetic Natural gas and that synthetic liquid is enormous So if this were to become reality it would mark not not just an important development of coal markets But would also imply the revisions to the gas and the oil market outlooks So thank you very much for your patience. So so this is a wrap up So coal demand will grow at 2.3 percent per year on average to reach almost 9 billion tons in 2018 and let me remind you that in 2000 Coal demand global coal demand was less than 4.8 billion tons, so it's a huge rapid increase and we believe that the policies of the new government in China will slow coal demand growth but we do not project peak coal in China in our outlook period and The OECD coal demand will be basically flat as Japan and Korea will offset declines in other OECD economies Indonesia and Australia will lead the export growth and Australia has increased production costs recently, but it's still competitive and Finally after some years of uncertainty It seems that the coal conversion is in China is taken off, but its scale will depend on the environmental and other Issues, so thank you very much for your patience and so that's it from me And I'll be happy to fill any questions that you may have. Thank you just a quick question before I open the floor to general questions the second point about the peak Chinese demand peak Mr. Sathamori, so you said that it's through 2018 you don't expect it in the longer version or the the WIO 2014 do you discuss when that may happen? Would it I mean when before? 2035 that may happen or would it be beyond the horizon? That's a valid questions and because this is about the a medium-term market reports, so we do not So this is not based on the scenario analysis while in case we are so it depends I mean if we take the the more kind of a Sustainable type of scenarios then Chinese are called demand must decrease, but So so I have to say that the depends on the scenarios and it all comes down to the individual Climate change and the energy policies that the individual country would have. Yeah. Thank you so now I invite anyone here to Ask questions and just the ground rule if you could police identify yourself and let us know if we you're with and then ask the Question of form of question. I have a question about India coal As you as you will know that they've said quite ambitious Goals to import more and more coal over the years What they're getting most are collier from Richards Bay and Newcastle and Calamity do you think that if Coal were to co-production there were to Max out at some point and they had to still hit targets. Would they? Start calling up more sources in the US to import from other sources So your question about the what did the Indian increase of imports from which country so I Think it depends. I think it depends The there's no doubt that the India will increase the the the coal imports and soon The instead of China India will be the biggest Especially the the biggest importer of coal in the over the in the US Oversee, you know, they did the coal and The from which country I think it depends that I can only say that there are enormous resources abound in the In the the Asian region, you know Indonesia still has a lot of capacity while Australia has a lot of coal and The and South Africa they they are the real swing swing supplier and now increasing the supply their supply to the coal so But because the the coal has a unlike LNG the coal is Has a very a flexible liberal, you know, the trading regime due to its character. So if Especially the the Colombian coal can be completed in price terms, even if we add the kind of extra Transport cost then well, they can be but but I would say that it all depends upon the market conditions. Yeah, thank you Thanks for hosting all of us. My name is Meredith Miller from the National Bureau of Asian Research And thank you very much for a very interesting presentation I was wondering if you could repeat the statistic you offered about what kind of gains would be Available from the implementation of ultra supercritical or supercritical power plants in Projects in Indonesia and other developing countries non OECD countries in Asia And secondly if you've done any analysis of what kind of a carbon price would make The use of that technology More competitive Thank you What I said in my presentation was that the if all those are subcritical plants under development in India and In ASEAN states including Indonesia were completed with the latest Existing technologies so super ultra critical type of high efficiency co-production plants It would save as much CO2 as would be saved by all the wind turbines in Europe So that's that's what I stated, but but I think it's It's a real kind of a practical realistic Ways in order to reduce the CO2 emissions In these countries because the they'll be using coal anyway So so that's so the improving the the efficiency Because that's possible with the existing technologies. So I think that that's a real the effective way to do it and What was the second question? Well, I've been using this the the carbon pricing is used in terms of the comparison of the gas and coal so in terms of Increasing the the the efficiency increases I think it can be done even without the carbon pricing per se because that would reduce the consumption of the coal if they they can really the increase the level of efficiency of those carbon coal power generation plants, so it's it's a kind of comparison between the the The the the larger Capix capital cost at the outset or the long-term benefits out of the improved efficiency so so So I don't think that the even without the carbon pricing if we can come up with a kind of a the good support To the initial investment phase then I think that should be possible because it pays in the longer term, you know But of course that the carbon pricing should help. I mean of course, but So I Think it's a rather relative problem. I'm sorry. I have not done any that the kind of a specific calculations, but yeah Thanks If you could wait for since we're taping or Doing a live Streamer whatever it's cold since I'm kind of taking a challenge, but if you can wait for the microphone, that'd be a great help Brian Andrews with the Asia Group Your presentation noted that the US regulatory environment is having some impact on US coal demand particularly with the retirement of coal power to Electricity production I was wondering if you have a perspective review on Some of the US changes announced last year where they would be withholding support on if he financing for coal power projects Internationally do you expect that that policy change will have any impact on global coal consumption or demand or is it something? You haven't really paid attention to or it's just you know the grand scheme of things a drop in the bucket So you're talking your question is about the kind of about the US policy changes And the the kind of impact coming from that to the international the deployment of the the carbon The and that I guess that would include the World Bank's policy for in multilateral lending Institutions policy against the coal use. Well, well, thank you. Thank you for your question Well, I would say that in terms of the direct impact if we take a look at the how the the coal projects are financed the the if you take a look at the whole supply chain of coal from the production to the the and and the consumption including the power generation plants We consider that the the majority most of the financing is coming from the private sector and The I'm not sure but but I understand that it would be something like a 5% is a provided by that the public a multilateral Finance financing institution So I would say the in terms of the direct financing impact Did we don't consider that to be a kind of they have a serious impact on it? But but but but in terms of the indirect effect the I'm not sure I mean But but I would say that what is important is that we really need to Make sure that the needed the efficiency improvement investment should take place In those developing countries including the Asia Southeast Asia and India and China otherwise, we may lose the window of opportunities for Reducing the CO2 emissions in in a practical and realistic way So so I think that's something that we need to ensure and that's part of the responsibility of the developed economies. Thank you if I can the quick follow-up question to that excellent question so From what I understand the ADP has The the sort of World Bank has pretty much followed the US Treasury Department guidance or however You call it on the financing from what I understand ADP has not adopted that line of thinking To the extent you're comfortable if you could share with me what sort of discussions you might be aware of with among the Asian Countries because I think Cole as you eloquently this you know explained. I mean it is still very big Player in the Asian energy economy so The I'm not a really expert on this a multilateral lending institution So so I guess that there would be some others who knows better than I do But my understanding is that the in in the very discussion at the ADP especially those The the Asian member countries view is somewhat different from that of the United States. So they're more positive about ensuring the investment money flow to the Asian the coal power generation plans. So so that's There as far as I know in general, but I'm not sure about the very specific Yeah, the the policies of them. Thank you But but I but I also I would like to point out that it's not only about the natural lending institutions But we also have the bilateral the the the credit support institutions In various of the countries. Yeah Yes Can my record roll docks One of the trends over the last decade at least with regard to oil is the increasing cost of producing oil In terms of the energy return for energy invested, which is reflected in the price per barrel If it was still $30 a barrel, nobody would be practicing hydraulic fracturing Or probably deep water drilling or mining tar sands With regard to coal, is it not only cheap but for the foreseeable? I mean not only abundant but for the foreseeable future cheap to produce At least in the The this a medium term outlook I mean the as far as we can see they we do not expect the coal to the coal costs to increase drastically because that they're so abundant and they're still Have the resources that can be the easy exploited So so I understand that the situation is rather different from the situation of oil where they have to go all the way to the Arctic sea or the very deep sea resources or the Fracking so so so I think the coal is not the days that the coal will move into that kind of a high cost stage is very far Yeah, I'm Bob Hershey. I'm a consultant Could you tell us some more about coal conversion of how much would be to? Synthetic natural gas and how much The first of all I would have to say that It depends. I mean they were not so sure how much of the project can be actually be the implemented Because it's it it there there's a lot of uncertainties as to the environmental impacts, you know the when I first when I first heard that The the coal to gas conversion may take place. I Thought that it's it's a good news. I mean because gas is a lot cleaner But this very The gas to the the coal to gas conversion in being considered in China actually would produce more CO2 because that would be more that would be less efficient than burning coal itself so of course they would do that in order to To improve their you know handling of the energy sources because the gas would be a lot easier to use in some occasions but But but but we have not So there will be more of the the environmental impacts coming from that So it all depends upon how the Chinese regulatory authorities would respond to that and also In order for the coal to gas for instance to work there needs to be an access to the pipeline So and the as you know, the China also has In the process of developing the gas networks in the country So so it also depends on the the transport logistics the day of that and What I'm looking at is So what was the size of the in this very port? I'm sorry Let me come back to you later because there's an assumption in this in certain point, but that's not huge Yeah, but but but I think that the the we are seeing the kind of about the rise in this technology in China And that could be Kind of of the major factor in the coal demand. Yeah, thanks Thank you. My name is Tom Cutler. I'm an independent consultant. So I have a question about coal trade I noticed on one of your charts you showed the drop-in production from the Powder River Basin Which is a very large economic resource for coal in the US and Then another chart you had you had a very thin line coming out of the Pacific Northwest for US Coal exports to Asia. So my question is do you have any perspective on the prospects for increased coal exports from the Northwest US to Asian markets and how might that compete with US coal exports out of the Gulf through the Panama Canal to Asian markets No, I would say that the powder river basin is has a very a cheap I think that's one of the cheapest the coal that can be exploited in the United States But I also understand but there's the problem of the transport cost and the export infrastructures with the With that the powder river basin unlike the Appalachian coal which has a kind of a long years of tradition and Very the endowed export facilities So it all depends upon the how those infrastructure can be developed and also The how that the cost would turn out to be I mean, so it's so it's up to the market So so we're not sure how The those are the the the resource will actually be exported So so that's I would have to say that that depends on the market conditions. Thank you. Thank you for your question Anyone else? Yeah, sure. Okay round two Isn't pet coke competitive with coal for certain pet coke Petroleum coke Isn't that competitive with coal for certain applications and isn't China increasing their import of pet coke and aren't we increasing in our production of pet coke? I forget exactly why it's got something to do with light oil versus heavy oil I'm sorry. I don't have I don't think I have the data with this the report so I don't think I have any specific answer to this Yeah, yeah, the it could be cost-competitive but it all depends upon the various the the environmental regulations and So depends on the circumstances, I guess Anyone else so I guess I get to ask one last Guy Caruso CSIS a suki. I know the Chinese have been somewhat reluctant to Partner up with IEA, you know, certainly at the at the level of membership But but they are very active in things like technology. Is that true for the coal Technology is to have the Chinese been active participants in cooperating with our member using the term ours Well, thank you very much for the question and I'm really happy to see that you call the IEA as we our So that's it's nice Yes, the I think there there's some multiple The factors the around the relationship between the IEA and China and of course Well, first of all the the IAEA started in the 1970s as a kind of the importers alliance against the the physical disruption of the oil imports and At that time I was created under the framework of the OECD So we have the OECD members as the IEA members not exactly the same but basically and During the time the OECD or IEA members consumed around three quarters of global oil. So that was That was appropriate, but now we are seeing the more and more the energy demand coming from the non-OECD countries now and And from last last year to this year We'll see that the non-OECD oil demand will overtake the OECD demand so that means that the IEA has only half of global oil consumption and that will lead to the question of whether The our emergency response regime is effective in case of physical disruption So that leads to that lead that force us to work more with the non-member countries And right now we are working on the initiative called the association so we are trying to create a kind of category of association partners and to work with the IEA more before becoming a members and The China is of course an important partner in that respect and so we are doing a lot of work projects with China In terms of the energy security we think that they did the working with the China is very important And but that's that's not only about oil, but the coal particularly Gas because they are interested in how they can modernize their gas market. So we are willing to Contribute to China in that respect and also the various climate change energy efficiency technologies as well. So And the we think that we'd like to do more work more with China And for instance in the in case of the coal for instance we we have what we call the CIAB coal industry advisory board and There are some major Chinese, you know the coal power generation companies the the coal companies that are member to the CIAB So on a private sector basis, we already have the they started to work with China so all in all the we would like to see more of the cooperation with China, but it requires a lot of Work ahead of us. So first of all, we need to build more confidence with each other So the so I'm willing to work whatever Cooperate the project with China in that respect. Thank you very much for your question. Yeah Well, it's it's time. So please join me in thanking thanking Sada Morisa for his excellent presentation Thank you. Thank you very much. And thanks again for coming all the way here despite the freezing Sub-zero Celsius temperature and stay warm Thank you so much. Thank you very much