Wood Mackenzie and coal
Wood Mackenzie - which is often referred to as 'Woodmac' - is a global energy and mining consultancy group.
While the consultancy was formed in 1973, Wood Mackenzie's work for the coal sector crystallised in 2007 when it bought two other consultancies, Hill & Associates and Barlow Jonker.[1]
In March 2015 Wood Mackenzie was bought by Verisk Analytics, a US risk adviser to the insurance industry.[2]
WoodMac services
In a promotional brochure for its Coal Market Service WoodMac states that it "provides in-depth analysis and forecasts of global and regional coal market fundamentals, giving confidence to your strategic planning."[3]
It also operates a Coal Supply Service which it boasts "our comprehensive analysis of global coal supply allows you to better understand opportunities, risks and challenges to give you a sound foundation for investing and planning."[4]
Wood Mackenzie's reports on the growth prospects of coal industry are widely used by coal companies to underpin the prospects for new mines and expansion plans. Their estimates on the future growth of of global coal markets have also been widely cited by governments, intergovernmental agencies and media outlets.
What Wood Mackenzie does
On its website Wood Mackenzie boasts that it is "a global leader in commercial intelligence for the energy, metals and mining industries, we provide objective analysis and advice on assets, companies and markets, giving clients the insight they need to make better strategic decisions ... With our robust proprietary data and models we can forecast and value with confidence and provide clients with strategic advice that they trust. Our global teams of experts rigorously evaluate the data, ensuring an unrivalled depth of understanding of our chosen markets. Our consultants work directly with clients to address their business challenges."[5]
On its website the company lists as some of the work it has done on coal issues as including:[6]
- "An African government wanted to generate revenue from its coal resources. We developed a Coal Roadmap to help them to get their industry off the ground;"
- "A national oil company in Asia had been focused exclusively on oil production. We worked with them to develop a strategy to underpin its entry into the Asian coal market;" and
- "A coal producer wanted to understand what the effects of Chinese imports would be on their market position. We devised scenarios for Chinese thermal coal demand allowing our client to develop their 10-year strategic plan."
Botswana coal plan
In 2011 Wood Mackenzie was hired by the Botswana's Department of Geological Survey to develop a "Coal Roadmap" for the development of a coal industry.[7]
While Wood Mackenzie doesn't publicly identify its client, it states on its website that it "developed a Coal Roadmap to help them get their industry off the ground." It stated that it:[8]
- "Reviewed all existing information held by the Department of Geological Survey on Africa's coal resources;
- Investigated eight potential end uses for the coal and evaluated how each could generate revenue;
- Generated a matrix of eight options, scoring and ranking their attractiveness;
- Developed a set of immediate, short, medium and long-term actions to create the maximum possible impact on the country's coal development; and
- Brought this all together in a strategic Coal Roadmap to guide the client as it developed its coal industry."
The outcome, WoodMac stated, was that the government "had the strategy and tools to kick-start their coal industry."
In October 2010 the Director of Mines, Abi Kgomotso told Businessweek studies for the Coal Roadmap were funded from a World Bank loan for the Morupule B power station project.[7]
Chinese coal market study
On its website Wood Mackenzie also listed "Developing scenarios for Chinese coal price" as a case study.[9]
It stated that "a coal producer wanted to understand what the effects of Chinese imports would be on their market position. We devised scenarios for Chinese thermal coal demand allowing our client to develop their 10-year strategic plan."[9]
To do this, WoodMac stated that "analysed macroeconomic estimates and modelling of the Chinese economy - including questions on whether the Chinese government could control growth at a sustainable pace, environmental concerns and legislation - and the potential for a domestic Chinese gas industry", "examined pricing as an incentive for consumers to switch between imported and domestic coal by comparing domestic coal mining costs" and "considered other factors that would impact pricing such as global seaborne supply and demand, and growing demand for thermal coal in India."[9]
WoodMac stated that "by quantifying and benchmarking our client's competitive position, we helped them develop their long-term strategy. They could then make an informed decision on the implications of expanding production, based on Chinese demand."[9]
Clients
Clients for Wood Mackenzie have included the World Coal Association[10], the Queensland Competition Authority in 2008[11]
Lobby group affiliations
Wood Mackenzie is a member of the National Mining Association, the peak US mining industry lobby group.[12] On its website the NMA states that its "mission is to build support for public policies that will help America fully and responsibly utilize its coal and mineral resources."[13]
Articles and Resources
References
- ↑ Wood Mackenzie, "About us: Our history", Wood Mackenzie website, accessed May 2015.
- ↑ "Verisk Analytics to Acquire Wood Mackenzie", Wood Mackenzie, March 10, 2015.
- ↑ Wood Mackenzie, "Coal Market Service", Wood Mackenzie, November 2013.
- ↑ Wood Mackenzie, "Coal Supply Service", Wood Mackenzie website, accessed May 2015.
- ↑ Wood Mackenzie, "What we do", Wood Mackenzie website, accessed May 2015.
- ↑ Wood Mackenzie, "Case studies", Wood Mackenzie website, accessed May 2015.
- ↑ 7.0 7.1 "Govt suspends issue of coal, CBM licences", Mmegionline, July 1, 2011.
- ↑ Wood Mackenzie, "Strategy to develop a national coal industry", Wood Mackenzie website, accessed May 2015.
- ↑ 9.0 9.1 9.2 9.3 Wood Mackenzie, "Developing scenarios for Chinese coal price", Wood Mackenzie website, accessed May 2015.
- ↑ Jeff Watkins, "WCA: forecast comparison", World Coal Association, May 24, 2012.
- ↑ "Review of Coal Railings Forecast", Queensland Competition Authority, October 2008.
- ↑ National Mining Association (NMA), "Member List", National Mining Association website, accessed May 2015.
- ↑ National Mining Association, "NMA Overview", National Mining Association website, accessed May 2015.
Related GEM.wiki articles
- William Durbin, Head of Research, Americas at Wood Mackenzie
External resources
- Ellen Ewart, Head of Global Coal Market Research, Wood Mackenzie, "The Outlook for International Coal Trade", Presentation to US Department of State Foreign Service Officers’ Coal and Power Training Course, July 15, 2013.
- William Durbin, President of Global Markets Research, Head of North East Asia Research, "Changing Energy Landscape and Its Impact to Feedstock Dynamics", Presentation to Asia Petrochemical Industry Conference, May 15, 2014.
- Ellen Ewart, Head of Global Coal Market Research, Wood Mackenzie, International thermal coal trade: What will the future look like for Japanese buyers?", Presentation to Clean Coal Day 2013 International Symposium, September 4-5, 2013.
External articles
- "What lies ahead for global coal?", Wood Mackenzie, February 18, 2015.
