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Chesapeake Energy Corporation Message Board

cadmium_telluride 373 posts  |  Last Activity: 8 hours ago Member since: Dec 28, 2007
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  • Reply to

    China Demand for Coal Collapsing

    by letxequalx03 23 hours ago
    cadmium_telluride cadmium_telluride 8 hours ago Flag

    That's SHAMEFUL rumor. The English version contains incorrect numbers. I looked up the Chinese original from the official source. There numbers are quite different:

    1. China consumed 449.5 billion KWH of electricity in August, or an INCREASE of 3.6% from same month last year. (This multiplied by 12 month gives you 5.4 trillion KWH per year, higher than the 4.0T KWH of USA)

    2. The Jan - Aug. (8 months) figure was 3282.8 billion KWH, or an increase of 5.1% from same period last year. If you divide it by 8, the monthly average is 410 billion KWH. August was higher than this average.

    3. Split into categories, First industry (mining and agriculture) used 70.2B KWH, a drop of -0.6%. Second industry (manufacturing) used 2418.4B KWH, an increase of 3.2%. Third industry (commercial and service) used 376B KWH, an increase of 11.7%. Residential usage was 418.2B KWH, an increase of 12.1%.

    So you see the commercial and service sector, as well as residential usage still increases at double digits. There is still HUGE room for growth. 418.2B KWH residential usage, averaged over 1.37 billion people, over 243 days. That's averaging merely 1.25 KWH per person per day, or a power consumption of 50 watts. You operate an air conditional unit for a while, it easily uses 10000 watts versus average of 50 watts.

      8月份,全社会用电量4495亿千瓦时,同比增长3.6 %。


    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride 19 hours ago Flag

    Let me repeat. The market took it totally wrong that they thought China banning poor quality coal import was bearish. Let me be clear. This is extremely bullish news. Getting rid of low quality coal production cuts the supply and lifts global coal price. It's bad for the bad players but good for all else. Good for high quality American coal production.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride 21 hours ago Flag

    A slowdown in growth IS STILL growth, and it still means demand growth, not demand drop.

    A 7% growth is less than 7.5% growth. But it is still positive growth and still a good positive number.

    Global coal demand has NOT stopped growth for a moment in the past few years. It continued upward movement and never dropped. The problem is some of the producing nations recklessly produced two much, when supply growth exceed demand growth the price drops. The two countries responsible for this is Indonesia and China.

    Indonesia, having only 0.6% of the world's coal reserve, see out of control control explosive growth in its coal production, and it is now the world's LARGEST coal exporter. A title that it does not deserve. But they produce low quality high pollutant craps that pollutes China's air.

    China also recklessly produced too much and exhausts its natural resource too fast. China has less than 6% of the world's coal reserve but produces MORE THAN HALF of the global coal production. China also produces very poor quality coal as the high quality ones are exhausted.

    China is now cracking down, banning low quality coal imports, and shutting down low quality and low efficiency domestic coal producers. This swift movement will cut supply and sent global coal market moving up soon.

    Sentiment: Strong Buy

  • This is great news to US coal industry. China finally moves to BAN poor quality coal imports to control air pollution. This is very bad news for Indonesian coal players, but good news to every other coal players.

    The island nation Indonesia isn't the best place for coal to form in the world. It's coal reserve is only 0.6% of the world according to BP Energy Review. Years ago Indonesia's coal production was negligible.

    But some how, from some time, for some reason. Indonesia's illegal coal mining grew rampant and they dig their coal like there is no tomorrow. Indonesia is now the world's LARGEST coal exporter. How could they afford to be the world's LARGEST coal exporter, producing 420M tons per year and exporting most of it, when you only have 0.6% of the world's coal reserve?

    Indonesia coal is completely crappy, contains little heat, a lot of dirt and pollutants. Who would buy their coal other than the Chinese. The Chinese, now suffocated in the severe air pollution due to burning of low quality import coal, now realize how stupid it is to import Indonesia poor quality coal.

    Get rid of the supply of poor quality Indonesia coal, every one else will celebrate. The global coal price will return to a more adequate level. The Chinese will breathe easier burning cleaner coal. American coal will sell at better prices.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Sep 9, 2014 5:18 PM Flag

    There is a LOOMING electricity crisis in India as they fail to stock up enough on coal. Its' widely reported, just google it.

    Remember in 2012, India failed to secure enough coal and there was a massive power blackout in July, plunging 700M population in complete darkness for three days, a world record. This time if they don't act soon. They probably will see a power outage affecting more than one billion people, or return the entire country back to stone age.

    You bet they know what they need to do.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Sep 9, 2014 3:49 PM Flag

    Now look at China, which consumes 4 billion tons of coal per year, more than half of the world total, and consumes 5 trillion KWH of electricity per year, versus 4 trillion KWH in USA.

    5. China experiences the worst drought in 60 years. Not a drop of rain in supposed flood season right now. This means collapse of hydro-electricity generation, and higher demand of coal to generate electricity. More over, coal mining destroys underground water resources, at a cost of 40 tons of water per ton of coal produced. China MUST crack down on coal production to save water.

    6. Many private sector coal companies in China can not operate any more. Most coal mining workers are working without pay, as their bosses do not have the cash to pay them. You can not work forever without pay. When workers stop working. The supply is stopped and there will be an immediate supply crisis, sending coal prices much higher.

    7. Indonesia, the island nation with less than 0.6% of the world's coal reserve but ridiculously become the world's No. 1 coal exporter, is also collapsing. Recently it is widely reported in China that a full ship of supposed to be coal from Indonesia was examined at the port, and found to be a full shipload of muds. That island nation is running out of surface coal. They can NOT dig underground coal because the ground is sandy, and easily collapses when you dig tunnels.

    In all counts, now is the best time to buy coal stocks and take an incredible ride in the next year or two.

    Sentiment: Strong Buy

  • Look at the long term chart of WLT. Do you see how it swing tot he crazy high and then drop to the rock bottom and then swing to the extreme high again? Right now is an un-precedent rock bottom, within two years it will reach an un-precedent historic high. Be rest assured that is happening faster than you expect:

    1. Coal is always an inherently cyclic commodity. It's been used for thousands of years. The demand is growing rapidly, at a time when the world's petroleum and natural gas resource is quickly running out. You think coal is becoming an obsolete fossil fuel? Think about what we use to generate electricity? Burn oil? Natural gas? Or burn bull sheets? Come one!

    2. US coal stockpile has dropped from record high of 200M+ tons, to a record low of 130M tons. Do we need to drop to zero for a panic? Right now should be a panic level. Power plants simply do not have an adequate inventory to ensure smooth operation. Remember the US consumes nearly 1000M tons per year for electricity.

    3. The Shale Gas bubble is bursting soon. You inject water at high pressure to crack rocks underground, and getting roughly only 3% to 5% of the original shale gas underground out and be produced. You call that an energy revolution? Getting only 3% to 5% out and it can feed us for more than 1000 years? Replace coal? They are telling you a fairy tale. The investment community collective invested OVER TWO TRILLION DOLLARS of fund in th so called shale revolution. They have not seen a dime of return in terms of product revenue. The shale industry producing only 12 trillion cubic feet of gas per year, at $4 per thousand cubic feet that brings in a revenue of $48B per year. But the investment community continues to pump $300B new fund per year to sustain the crazy pace of shale well drilling. This insanity cannot last. Capital MUST seek profits.

    4. A debt crisis collapse of the shale industry will be the best thing happening to the coal industry.

    5. China faces the worst drought ...

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Sep 2, 2014 11:34 AM Flag

    Let me explain again what the implication of China's drought means:

    1. Coal mining destroys a lot of underground water resources. Mining one ton of coal destroys 40 tons of underground water. Since China's coal base is in the dry north, they MUST choose between survive and coal. They must drastically cut back coal production to preserve water, or perish from lack of water. That decreases coal supply and is bullish to coal.

    2. The only way to get water is pump underground water. It's getting harder and harder, they have to dig deeper wells each year. Both well digging and pumping water from deep underground costs a lot of electricity. That increases coal demand and is bullish to coal.

    3. August to September is supposed to be China's flood season. This year. No rain even during flood season. So there is a lot less hydro-electricity and it mandates more coal burning to generate the same amount of electricity. More over, they have to cut down water flow to make the limited water reservoir to last till next year's flood season. Another factor to cut down hydro-electricity. Some stations are generating less than 10% what it generated this time last year.

    All combined, everything is lined up for an incredibly huge bull run for coal in the next 12 to 24 months.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Sep 2, 2014 2:16 AM Flag

    And now this:

    Indonesia to cap coal production in 2015

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Aug 22, 2014 10:27 AM Flag

    They can't buy more oil and gas because more oil and gas is simply not available in the global market. They have to produce less coal, and import more coal.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Aug 19, 2014 4:16 PM Flag

    Be rest assured that the coal turn around will be bigger than any we had seen in the history. This is an incredible opportunity to make a lot of money. Stick with coal for the super coal cycle!

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Aug 12, 2014 9:53 PM Flag

    Most Americans cannot even begin to comprehend how severe a water crisis China is experiencing. People there are actually very desperate.

    In America, when we talk about water preservation, we talk about cutting down irrigating our back yard. Maybe sprinkle three times a week instead of each day. We talk about maybe we take only one shower per day, instead of two, one in the morning and one in the afternoon. We would not think about cutting off brushing our teeth altogether to save water, would we? We would not think about stop drinking coffee, or stop having soups for dinner, would we?

    In the PingDingShan city in Henan Province, in a normal year, the per capital water resource in that city is only 1/16th of the average of China. And China's per capital average water resource is only 1/4th of the global average. And we were talking about a normal year. And the per capital water resource in America of course is much higher than the global average.

    So showering in water was long ago a luxury in that city. And brushing your teeth is a luxury, too. Washing and cooking leafy vegetable is now a luxury, as is doing laundries.

    As of now, the reservoir which is the ONLY water source of that city has run BELOW the dead level. They are already utilizing what little water is remaining below the dead level. It can only sustain another ten days. After that, they run out of all water and they must either shut everything down, or some how figure out how to transport water from some where else into that city. And what happens next? Remember, right now is supposed to be the raining season and the reservoirs are supposed to be filled up in preparation to the dry season which comes up next!!!

    If you begin to comprehend the water situation in China, you will know where coal should move globally.

    Sentiment: Strong Buy

  • China Experience the Worst Drought in 50+ Years!

    That's extremely bullish for coal and set coal up for a super cycle.

    China's drought is not purely nature made. It was 10% due to nature and 90% man caused. The destruction of Northern China's underground water table has reached the critical point that in the past when there is drought people can always dig wells and fetch underground water to irrigate and problem solved. They can't do it any more. The wells are getting so deep, and so little water comes out that poor peasant can't afford to keep spending money to dig wells. It's a tragedy.

    China must come to terms that a big factor that destroyed its underground water resource is out of control coal mining by the private sector. Mining one ton of coal destroys 40 tons of underground water resource. China produces 4 billion tons of coal a year, about half of the global total. That's 160 billion tons of water resource destroyed per year. China must realize that it MUST choose between coal and water and must crack down on coal production to survive, because you can not survive without water.

    Residents in a city in Henan Province would refrain buying leafy vegetables these days but would eat fried pies instead, because it costs too much water to wash and cook leafy vegetables.

    So crack down on coal production to protect water is a must. That's bullish on the supply end.

    On the demand end, drought means much lower hydro-electricity yields and that mandates more coal to be consumed to generate more electricity.

    The drought also means more electricity is needed to pump water from deeper wells for consumption and irrigation. To think about pumping water from 500 or 600 feet down is not a small task. It consumes a lot of electricity. Just do the calculation.

    China produces and consumes half of the world's coal. What's happening there is extremely bullish.

    Sentiment: Strong Buy

  • Reply to

    My home town: Riots

    by run_by_hr Aug 11, 2014 4:47 PM
    cadmium_telluride cadmium_telluride Aug 12, 2014 9:23 PM Flag

    The coal super cycle is ongoing and it probably has started. But you won't notice it until long after the fact, and you won't appreciate its full scale until long after the super cycle has run its entire course.

    It would have been easier if a lot of people can predict precisely before hand when does a super cycle begins, and when it ends, and when was perfect time to get in and get out. Unfortunately no one can make that prediction. Me neither. I could only predict that a super cycle is ahead of us. As for precisely, when and how it starts, and when and how it ends, I have nothing to say.

    A super cycle has to start from something ridiculous low, like $3 stock price, and go to ridiculously, like a $300 share price. You won't not call $3 to $3.50 a super cycle, or $100 to $120, would you?

    To deny that, and to claim that since the share price is at $3, it will forever stay at this low, and that coal is forever an obsolete fossil fuel, when the world is running out of oil, and there is not much natural gas to sustain us for long, and alternative energy is too little to scale up, is rather ridiculous.

    The Coal King is more important in the near future, that it ever was in recent history.

    Sentiment: Strong Buy

  • cadmium_telluride cadmium_telluride Jul 30, 2014 11:48 AM Flag

    The fact of the matter is at the moment, both US coal stockpile, as well as natural gas storage are at historic lows. Economy 101 should mean that consumers must be actively stock up in expectation of the coming supply squeeze, but they continue to de-stock, defying logic. This must be an aberration and can not last for long before they panic.

    China is a good example, every one has an illusion that China's coal is over-supplied. In reality, their coal stockpile at power plants dwindled to 7 days or less supply in many places, which is dangerously low. Recently heat waves hit many part of China. Just when every one needed to crank up their air conditional units to fight the heat wave, there is widespread power failure in many cities because the power generation can not keep up with the demand.

    China was blessed (cursed) with excessive flooding in 2012 and 2013 which brought in higher than normal hydro-electricity, curbing coal demand. Not any more in 2014. Right now it was supposed to be the flooding season in China. But there were drought report every where. They have to cut hydro-electricity generation and keep the water in the reservoir for longer. So that will boost coal demand. Mean while coal production will collapse. Most coal mines in China are now operating with heavy loss. The first thing the Chinese coal bosses do when you have a loss is they CUT worker's salary or renege the salaries altogether. This is UNTHINKABLE in America: In America you may be able to lay off workers but you can not cut your worker's salary and ask them to continue to work. But in China they can get away of cutting worker's pay and tell the workers to either walk away or continue to work like a dog. Guess how long can the Chinese worker continue to dig coal without pay? Probably not very long.

    The coal is turning around big time for sure. Hold on.

    Sentiment: Strong Buy

  • US coal is coming back powerfully.

    Check the EIA data, for the January to April period , electricity generation from coal for the year 2012, 2013 and 2014 were 444774 GWH, 505286 GWH and 548297 GWH respectively, showing a very clear and powerful return to normal. Mean while natural gas generation went from 368450 GWH to 329294 GWH to 318954 GWH, on clear decline. Coal is now 41% of US electricity generation, so it is completely back to norm.

    Mean while US coal production is still curtailed, at less than 19M tons per week. Since 87% of domestic coal is used for electricity generation, that figures to 2.36M tons per day, or good to generate 4342 GWH of electricity per day. But in the first4 months (120 days) of 2014, US coal generation was 548297 GWH, averaging 4569 GWH per day, or costing 2.50M tons of coal per day. Comparing supply and demand, there is a 0.14M tons per day shortage, which is driving down US coal stockpile.

    The coal sector in US is turning around big time. It will be reflected in coal price and coal stock share price soon. As I always stated, the coal sector is always cyclic.

    In China, coal electricity generation is still growing at 5%+ yearly. In 2014, due to unusual drought condition, there will be a big fall in hydro-electricity generation compared with 2012 and 2013. That's good news to coal.

    Sentiment: Strong Buy

  • From $5 to $6 takes only FOUR days! That's the kind of beginning of a super coal cycle we talk about!

    We are in business. Hold on folks. Don't sell too easily.

    Sentiment: Strong Buy

  • Reply to

    Hmmm , of all the coal stocks

    by divin4tacos Jun 23, 2014 12:41 PM
    cadmium_telluride cadmium_telluride Jun 23, 2014 1:23 PM Flag

    And for hours they were able to lock both bid price and ask price at precisely $3.73. I wonder how that works. Are they selling from one hand to the other hand and just pay trade commissions for nothing?

    Sentiment: Strong Buy

  • Reply to

    US Coal Is Entering a Super Bull Cycle

    by cadmium_telluride Feb 3, 2014 12:26 PM
    cadmium_telluride cadmium_telluride Jun 19, 2014 9:54 AM Flag

    US coal super bull cycle is alive and well and kicking, and is screaming to the world that it is here and roaring. Don't make mistake: Any super cycle MUST necessary start from a super low and super dismay, give away price, and go towards a ridiculously high price. Going from $90 per share to $99 per share, that's no super cycle at all.

    Super bull cycle is going from current below $4 a share of ACI, knowing the same coal shares fetched $60 or $70 per share a few years ago, with every one thinking that the coal industry is fading into the sunset and that five thousand years of human history of coal mining and consumption is ending for good here and now, knowing full well that coal is still responsible for 42% of US electricity generation, and then in one or two years ACI shall move close to $100 or $150 per share, and every one wondered why the world thought that coal was obsolete when the entire world faces a global oil crisis, and there is not enough natural gas, and why nobody foresee the collapse of the un-sustainable shall gas Ponzi Scheme, and why all those folks who refuse to touch ACI below $4 per share now fights hand over fist to pay $100 to buy a share of ACI.

    That is happening soon and that is what I call super coal cycle. I intend to hold my coal shares for the entire up cycle of this coal super cycle and have no intention to reduce my coal investment significantly until I see $100+ share prices. And I have posted enough on this board on coal that I am reluctant to repeat any further. But do not post does NOT mean a bit at all that I have given up on coal. Not at all. I just decided that fools can not be educated no matter how hard you try.

    I often made mistake on timing. No question about it and I always admit that. I timed this super coal cycle way too early that's for sure. If you want timing advice, don't ask me. But I bet on the eventuality and certainty that this super cycle is happening, and bet patience, not timing, to reap profits from it.

    Sentiment: Strong Buy

  • cadmium_telluride by cadmium_telluride May 5, 2014 7:55 PM Flag

    I have been a long time advocater for palladium investment and advocater for SWC. You all know me.

    But let me remind people. Besides palladium and platinum, SWC also produces some nickel as by-product.

    Nickel is flying! The reason is Indonesia, supplier of 19% of the world's nickel, announced a BAN on nickel export. Hold your SWC shares firm! And hold for Russia to ban export of palladium to the west!

    I wish Indonesia also bans coal exports soon! Be sure to pick up some coal players ANR, ACI, BTU.

    Sentiment: Strong Buy

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