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Д О Н Т О П Э Н Е Р Г О

Новости и информация об угле и угольной отрасли

D O N T O P E N E R G O

Market Summary

Donetsk coal basin (Donbass) was discovered in the 18th century. The industrial coalmining was started there in the 1870s. The extraction of coal was growing fast – from 1,4 million tons in 1880 through 11 million tons in 1900 and to 16,9 million tons in 1913. Before World War I Donbass provided 70.3% of all Russian coal. During World War I and Civil War in Russia (1918-1922) the coal extraction in Donbass reduced to only 4.6 million tons (1920).

Before World War II Donbass gave annually 83.7 million tons of coal (50.5% of the total coal output in the USSR). In 1990 (the last completed year of the USSR) the total extraction of mineral coal in Ukraine was 170.2 million tons, and 10.0 million tons of lignite. By coal output Ukraine was the second largest producer in Europe – after Poland.


Lvovsko-Volysnky coal basin was organized in the Western Ukraine (western part of Lvov region and southwestern part of Volyn region) after World War II. Initially it was extracting brown coal but by 1960s it was re-oriented at mineral coal.


In the 1930-1960s Ukraine was the main coal base in the USSR. Its importance started to reduce after Kuznetsky coal basin (famous Kuzbass) and Pechora coal basin were developed in the 1960s. By the end of the USSR Ukraine provided only 20% of the total coal extraction in the USSR.


In early 90s, when reform in the power industry was well under way and the gas industry had embarked on the first steps toward reform, Ukraine’s coal industry remained untouched by the changes happening in the country. In that years the coal industry employed 650,000 workers, who produced annually 66 million tons of coal in 276 mines and 64 enrichment plants.


In addition, 200,000 people were employed in supporting functions such as mine construction, machine building, and social services (such as kindergartens).


Labor productivity was far lower than in other countries, and about one-third of the mines produced coal at a cost above the import parity level. While a coal miner in Ukraine produced on average about 100 tons of washed coal in 1995, the comparable figures were 200 tons in Russia, 400 tons in Poland, 2,000 tons in the United Kingdom, and 4,000 tons in North America. High-cost mines received US$400 million in cross-subsidies from low-cost mines. The coal industry as a whole received US$240 million in budget subsidies, and US$500 million more from the rest of the economy in the form of an increase in the stock of (net) accounts payable during that year. Labor costs were too high, with payroll and disability allowances making up more than 40 percent of operating costs in 1995.


The 383 coal industry enterprises were managed by the coal ministry, which, following the tradition of central planning, appointed enterprise managers, set production targets and prices, and allocated physical and monetary flows. But this old industry model was under severe strain. Profitable mines were reluctant to transfer revenues to unprofitable mines, bringing them to the brink of financial collapse. The accumulation of uncollected receivables by the central coal marketing agency (Uglesbyt) created strong incentives for mines and mining associations to arrange their own sales (mostly through barter to minimize the risk of the coal ministry confiscating their revenues).


Until 2004 the Ministry of fuel and energy managed all these coalmining assets and in October 2004 they established state holding (so-called NAK - National Joint Stock Company) «Coal of Ukraine». It united more than 120 coalmines, coal enrichments plants and few auxiliary companies like coal transportation and equipment repair plants.

Total reserves of coal in Ukraine are 117.5 billion metric tons, including 56.7 billion tons of discovered reserves, from which 39.3 billion tons is thermal coal. Production and consumption of coal in Ukraine have been relatively flat since 1996. In 2009 the country produced 54.8 million metric tons of bituminous coal and anthracite, and 15.6 million metric tons of lignite, while consuming roughly 72.6 million metric tons, making Ukraine a net importer, despite its sizeable resources.


Last 3 years the coal production felt – from 80.3 million metric tons in 2006 to 70.4 million tons in 2009. Global economical crisis has led to a drop in Ukrainian steel production – that respectively influenced coking coal demand; energy consumption drop with most of the country’s industries – also caused with the crisis – has lowered a demand in thermal coal.

Most of Ukraine's coal is mined in the Donetsk/Donbas basin in the eastern region of the country. The country's coal industry, which counts for 170 mines and employs about 150,000 people, is managed by a hierarchy of state organizations and suffers from numerous problems including: labor strikes, hazardous working conditions, inefficiency and low productivity. Since Ukraine's independence in 1991, there have been over 4,000 deaths and 750 underground fires in the country's mines.

Currently about 45% of coal in Ukraine is being produced with private players – including their 55% share in coking coal production. At April 2009 the country’s Government announced further plans to privatize over 100 mines – but this was postponed due to political reasons.

Classification of coal in Ukraine

Bituminous and anthracite coal

First 1-2 letters in coal's grade name mean one of 10 grades by volatile matter:

D = long-flame coal (from Russian "Dlinnoplamenny")

G = gas coal (from Russian "Gazovy")

GZh = gas fat coal (from Russian "Gazovy Zhirny")

Zh = fat coal (from Russian "Zhirny")

KZh – coking fat coal (from Russian "Koksovy Zhirny")

K = coking coal (from Russian "Koksovy")

K 2 = coking second coal

SS (or CC in some sources) = weakly caking coal (from Russian "Slabo spekayuschiysya")

OS = lean caking coal (from Russian "Otoschenny Spekayuschiysya")

T = meager coal (from Russian "Toschy")

PA = semi-anthracite coal (from Russian "Polu- antratsit")

A = anthracite coal


 Applications for bituminous and anthracite coal:
  • For coking – grades "G", "Zh", "K", "OS"; sometimes "D" and "T";
  • For burning in boiler houses – grades "D", "G", "A" and "PA";
  • For burning at electric power stations – grades "SS", "OS" and "T".

    There are usually some letters or numbers after "grade" letters in coal's name, for example, DOM or K9. Letters mean classes of coal (by fraction size), and numbers mean the least thickness of plastic layer for some grades.

    Classes of coal (by fraction size):

    P = "plate" > 100 mm

    K = "large" (from Russian "Krupny") 50- 100 mm

    O = "nut" (from Russian "Orekh") 25- 50 mm

    M = "little" (from Russian "Melky") 13- 25 mm

    S = "kernel" (from Russian "Semechka") 6- 13 mm

    Sh = "burgy" (from Russian "Shtyb") 0- 6 mm

    R = "ordinary" (from Russian "Ryadovoy") underground mine 0- 200 mm , open pit mine 0- 300 mm


    Class of coal is indicated by one or few letters. Letters of class are indicated right after grade letters. The fraction of the specific coal grade is indicated by classes in its name = the least value of the least class and the largest value of the largest class. 
    For example, 
    ASh = anthracite coal ("A") with "burgy" class ("Sh") 
    GR = gas coal ("G") with "ordinary" class ("R") 
    DOM = long-flame coal ("D") with class 13- 50 mm (O = 25- 50 mm , M = 13- 25 mm – we take the least value from the least class, i.e. 13 mm from "M" and the largest value of largest class, i.e. 50 mm from "O") 
    SSSSh = weakly caking coal ("SS") with class 0- 13 mm (S = 6- 13 mm , Sh = 0- 6 mm )

  • TOMSSh = meager coal ("T") with class 0- 50 mm (O = 25- 50 mm , M = 13- 25 mm , S = 6- 13 mm , Sh = 0-6mm)

    The coal of grades "G", "GZh", "Zh", "KZh", "K" and "OS" can be classified by caking property. The caking property is indicated by a number that means the least thickness of plastic layer (in mm).

    For example, 
    K9 = coking coal with the least thickness of plastic layer in 9 mm 
    KZh12 = coking fat coal with the least thickness of plastic layer in 12 mm

    Basic characteristics of coal grades

    In direction from "D" to "A" grade there is the lowering of humidity, oxygen and hydrogen level:

  • Humidity lowers from 14% for "D" to 4,5-5% for "T" and "A" grades
  • Level of oxygen lowers from 15% for "D" to 1,5% for "T" and "A" grades
  • Level of hydrogen lowers from 5,7% for "D" to 1,5% for "T" and "A" grades 

    The level of sulphur, nitrogen and ash doesn't depend on grade. 
    The combustion heat growths from 32,4 MJ/kg (7750 kcal/kg) for "D" grade to 36,2-36,6 MJ/kg (8650-8750 kcal/kg) for "K" grade and then lowers to 35,4-33,5 MJ/kg (8450-8000 kcal/kg) for "PA" and "A" grades.


  • Correspondence between the Ukrainian and the US coal classifications

    The Ukrainian gradesThe US grades
    D, GHigh volatile sub-bituminous coal
    KZh, KMedium volatile bituminous coal
    OS, TLow-volatile bituminous coal
    PA; T, A (partially)Semi-anthracite
    AAnthracite
    ASubgraphite



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    Low Sulphur
    High Sulphur
    Grade
     
    AS
    AM
    AKO
    AS
    AM
    AO
    AKO
    AK
    Size, mm
     
    6-13
    13-25
    25-100
    6-13
    13-25
    25-50
    25-100
    50-100
    Moisture, %


           Wrt  
     
     
    6,0-8,0
    5,0-7,0
    5,0-7,0
    10,0
    9,0
    9,0
    9,0
    9,0
    Ash onasreceivedbasis, %
     
    Ar
    7,0-9,0
    6,0-8,0
    6,0-8,0
    9,0-12,0
    8,0-11,0
    7,0-10,0
    7,0-10,0
    7,0-10,0
    Volatile matter onasreceivedbasis, %
     
    Vr
    2,5-3,5
    2,5-3,5
    2,5-3,5
    2,5-3,5
    2,5-3,5
    2,5-3,5
    2,5-3,5
    2,5-3,5
    Net calorific value onasreceivedbasis, kcal/kg
     
    Qr i
     
    6600-6900
    6800-7100
    7000-7300
    6500-6800
    6700-7000
    6900-7200
    6900-7200
    6900-7200
    Net calorific value onasreceivedbasis, MJ/kg
     
    Qr i
     
    27,6-28,9
    28,5-29,7
    29,3-30,6
    27,2-28,5
    28,0-29,3
    28,9-30,1
    28,9-30,1
    28,9-30,1
    Sulfur onasreceivedbasis, %
     
    Sr t
     
    0,8-1,0
    0,8-1,0
    0,8-1,0
    1,3-1,9
    1,3-1,9
    1,3-1,9
    1,3-1,9
    1,3-1,9
     


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