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Kazakhstan coal industry set for growth

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World Coal,

Coal production in Kazakhstan is likely to continue to grow at a “relatively robust rate”, according to a new report from BMI Research, in spite of further falls in global coal prices through 2016.

Kazakhstan’s government has set an ambitious coal production capacity target of 151 million tpy by 2020, as it seeks to expand its coal export sector, as well as keeping pave with its expanding power and steel industries.

“While we believe the country will struggle to meet this target, it will nevertheless achieve a relatively robust level of output growth of 1.9% a year through to 2020,” said BMI Research, reaching 136.81 million t.

Currently, most of the country’s thermal coal is used in domestic power generation. But its proximity to markets in Russia – which currently takes about a quarter of Kazakhstan’s total production – India and China could see the country become and important supplier of coal on the global market.

India has already shown interest in financing coal mining projects in Kazakhstan, with an inter-ministerial working group established to assess investment opportunities.

In September 2015, the Kazakhstan and Chinese government’s signed agreements worth US$1.5 billion in the fields covering the transport, energy, nuclear, metallurgical and chemical industries. This included the construction of a coal processing complex in the Karaganda region, according to reports from AzerNews.

Meanwhile, ArcelorMittal is expected to invest in expanding its metallurgical coal mines at Karaganda to supply its steel production facilities in Ukraine after it sold its Kuzbass coal mines in Siberia to Russia’s National Fuel Co.

On the thermal coal side, Kazakhstan’s coal output will likely be driven by expansion at the Bogatyr coal mine, the world’s largest opencast coal mines in the northeast of the country. The mine has reserves of 4.5 billion t and produced about 38 million t in 2014 – or 30% of Kazakhstan’s total output.

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