Fossil fuels still pack a punch. So, there’s this deal happening between Glencore and Teck Resources that’s making a big statement about fossil fuels. They’re buying and selling coal stuff, showing how even though we’re moving towards cleaner energy, fossil fuels still have some serious value.
Coal’s Surprising Appeal
Even though lots of companies in the West aren’t super into hunting for new coal or building new mines, investors think coal still has some game left. Why? ‘Cause it’s got a role to play in the shift towards cleaner energy. Especially in places like Asia, where they’re really into coal for their energy needs.
The Steel Connection
Here’s the thing about coal—there’s this kind called coking coal, and it’s a big deal for making steel. Steel is huge for big projects like building infrastructure and going green with renewables. So, coking coal is becoming a hot choice for companies wanting in on this action.
Big Players in the Game
Check this out: BHP, the world’s biggest miner, decided to keep its fancy coking coal stuff this year. They looked at all their coal stuff in 2020 and sold some, but coking coal? They’re keeping it.
Now, Glencore is snagging Teck’s coking coal business. Analysts are saying this move could rake in loads of cash—like $5 billion to $6 billion every year. Glencore’s already a big player in the coal world, making tons of thermal coal (used for making electricity) and now diving into coking coal too.
The Not-So-Great Stuff
Listen, though—thermal coal isn’t winning any popularity contests. It’s super polluting and is on its way out as we shift to cleaner energy sources.
Glencore’s Take on Things
The head honcho at Glencore, Gary Nagle, says they’re all about slowly backing away from thermal coal. But guess what? He’s pretty confident that both thermal and coking coal will stay in demand for quite a while.
So, even though we’re waving goodbye to fossil fuels, they’re still showing they’ve got some tricks up their sleeves—especially when it comes to coking coal and its ties to the shiny world of steel and big projects.