Showing posts with label coal industry. Show all posts
Showing posts with label coal industry. Show all posts

Friday, November 9, 2012

Canada’s coal industry contributed $5.2bn to GDP in 2011 - PwC

Canada’s coal mining industry had contributed about $5.2-billion to the country’s gross domestic product (GDP) in 2011, a report by PricewaterhouseCoopers (PwC) had found.

The report, commissioned by the Coal Association of Canada, revealed that coal production in Canada delivered more economic and social benefits than expected, and included $3.2-billion in direct impacts and $2-billion of indirect impacts. The industry was also a positive contributor to Canada’s trade balance and benefited employment and communities.

Canada’s coal sector has experienced strong revenue growth and capital investment in recent years, and increased demand for metallurgical coal in emerging Asian economies, coupled with rising energy prices, had resulted in revenue growing at a yearly average rate of 15% between 2001 and 2010.

Capital investment rose yearly by almost 20% on average during the same timeframe.

“PwC’s research showed coal consumption in developed countries has remained stable over the last decade, but coal consumption in emerging economies has doubled and is trending upwards. If these consumption trends continue, we expect coal prices to continue above historic levels,” PwC director of economics and statistics and report author Janice Plumstead said in a statement.
Along with a contribution to Canada’s GDP and export trade, the report found the coal industry benefited Canadians through employment. Over 42 000 people were directly and indirectly employed in the coal industry. This included those who work in mine production, construction, exploration, transportation and reclamation activities as well as those who supplied goods and services to the industry.

Since 2004, employment in the coal sector had been steadily increasing and accounted for 14% of total mining employment. Average coal industry salaries were more than double the average national wage. From 2001 to 2010, salaries in the mining industry increased by 37%.

Along with employment, Canadians directly benefited from the coal industry through the royalties coal companies pay to governments. In addition to royalties exceeding $300-million a year, additional economic impacts on government revenues in 2011 were estimated at $698-million, which was available to fund public infrastructure, such as roads, hospitals, schools and government programmes, which have the potential to enrich the lives of Canadians.

The report found Canada had about 6.6-billion tons of recoverable coal reserves as at 2009, which was the latest year complete information was available for. These reserves are mainly located in British Columbia, Alberta, Saskatchewan and Nova Scotia.

The reserves comprised about 53% of bituminous coal and 47% subbituminous and lignite coal. The report found the country had recoverable coal reserves to support about another hundred years of future production and PwC said Canada’s coal potential could be even larger with a broader measure of coal resources in place estimated at 190-billion tons.

Canada produces about 60-million tons of metallurgical and thermal coal a year, the value of which reached $7-billion in 2011. Alberta produced about 30-million tons of coal in 2010, followed by BC with 27-million tons and Saskatchewan with almost ten-million tons.

The sales value of exported metallurgical coal was found to have totalled $8-billion in 2011, representing almost 40% of coal produced in Canada.

“Coal has always played an important role in contributing to Canada’s economic strength, however, this report helps to confirm the profound impacts the coal industry has on our economy and our communities through employment, taxes and royalties to governments and regional expenditures,” Coal Association of Canada president Ann Marie Hann said.

Edited by: Creamer Media Reporter