Tuesday, January 29, 2008

China Coal Energy Stock Offering Attracts $433 Billion (!)

Reuters reported yesterday:
The United States will commit $2 billion over the next three years to a new international fund to promote clean energy technologies and fight climate change, President George W. Bush told Congress on Monday in his annual State of the Union speech.

"Let us create a new international clean technology fund, which will help developing nations like India and China make greater use of clean energy sources," Bush said....

Today we see a Chinese coal company's IPO oversubscribed 122 times.

From the Times of London:

A Chinese coalminer has attracted $433billion (£218billion) in share applications for its flotation on the Shanghai Stock Exchange. The scramble by private investors for shares in China Coal Energy occurs as coal prices surge to record levels worldwide and Chinese power stations struggle to keep the country warm and lit in an extraordinary winter chill.

China Coal's offering received applications for 3.4trillion yuan of shares, 122 times the value of the stock on offer. The huge appetite for China Coal, just as the Shanghai bourse tumbled in the continuing global share panic, reflects China's mounting concern about energy supply.

Low global coal stocks, China's cold snap and a power crisis in South Africa have stoked a coal furnace that was already burning brightly. The price of steam coal delivered into Europe doubled last year, according to McCloskey, the coal price assessor, to $130 per tonne.

China's big freeze has forced the country to ban coal exports for two months while South Africa, another big coal producer, has asked mining companies to divert export coal stocks to domestic power stations in order to cope with severe power shortages, which caused rolling blackouts last week. Cargoes of coal loaded at South Africa's Richards Bay terminal traded on Monday at $105 per tonne, up 5 per cent on last week's price....MORE