What is coal worth in the ground?
The in-the-ground value of coal is somewhat subjective, since the value is partially linked to the cost of bringing it to the surface and preparing it for market. However, it remains a good and interesting question. Liberty Coal Energy has approximately 125 million tons of coal in its two current projects. The acquisition cost of the coal leases amount to approximately $350,000 which amounts to a raw acquisition cost for the first year of less than one cent per short ton. Of course, the ultimate cost to produce a saleable product is several times the acquisition number, along with the capital cost to build a mine. Powder river coals are currently selling in the $12 to $15 per ton range, and have been stable or rising. Increased demand should tend to increase the price.
Related Questions
- Many people think that UK Coal will automatically be granted planning permission for Hoodsclose because the coal is in the ground and they will get it out. Is this view correct?
- More coal gets extracted from the ground each year as measured in tons, but hasn the quality declined so much that net energy content is lower now than 10 years ago?
- Are Our Coal Estimates, In Ground Oil Reserves, And Natural Gas Estimates Reality Based?
