Colombia will continue to subsidize its coal industry for decades

The world's fifth largest coal exporter, Colombia, is confident that continued demand for coal in Asia will warrant the Colombian government's support for the industry for at least two more decades, even after Glencore said it would give up its mining contracts in the country. "The demand for coal from China and India will continue. It is impossible for them to change their energy matrix overnight and stop being dependent on thermal coal," Colombia's Mining and Energy Minister Diego Mesa said in an interview with Bloomberg this week. "We will continue to support the current operations," Mesa said, adding that the high-quality mines could continue to operate for "a few decades." Last month, Glencore said its Colombian subsidiary Prodeco would begin returning its mining contracts to the government after discovering it would be inefficient to resume operations at the mines, which were put on maintenance and servicing last March . Colombia's National Mining Authority rejected Prodeco's request to put the Calenturitas and La Jagua coal mines on C&M in January 2021. Glencore and the Colombian Ministry of Mines and Energy are in contact with companies interested in a possible takeover of the Glencore mines, Minister Mesa told Bloomberg. There has been interest from Asia in the mines, he added. Colombia is relying on coal demand from Asia, including China and India, to justify its support for coal mining in the country, while most developed economies are working to reduce their reliance on coal and phase it out as a source of electricity. After falling in 2020, global coal demand is expected to recover this year, according to the International Energy Agency (IEA) in its Coal 2020 report in December. Coal continues to be an important part of China's energy strategy, while India's coal demand will rise despite a slump in 2020, according to the IEA. Earlier this week, state-owned mining company Coal India approved 32 new coal mining projects with a total investment of US $ 6.4 billion as one of the world's largest coal consumers seeks to reduce its dependence on imports while its coal needs continue to grow.