Coal a priority for ore processing industry
Coal a priority for ore processing industry
The Lao government plans to have coal as a priority ore for local consumption, mainly to support the processing and production of the large industrial sector in the future, the Ministry of Energy and Mines reported recently.
The sectors include the production of cement, steel, potash, bauxite and energy generation and the production of aluminium-alumina.
The government expects that potash and bauxite production will see a large increase that will also require a large quantity of coal, the ministry reported.
The report noted that starting from 2020, the production of potash will be about 1 to 1.5 million tonnes annually.
So to produce 1 million to 1.5 million tonnes of potash will require about 400,000 to 500,000 tonnes of coal annually.
Aluminium production from bauxite ore will also require a similar quantity of coal, the report noted.
The ministry reported that starting from 2020; the government will focus on the production of potash and bauxite.
However the government will have to impose regulations on the construction of aluminium factories to ensure there is available energy supply, such as the two plants proposed for the southern part of Laos.
“And the production of potash will have to increase by about 200,000 to 300,000 tonnes annually,” the ministry noted.
Expanding the production of potash and bauxite is being considered with a view to boosting national revenue and replacing the production of copper and gold.
However for this to happen it will require policies such as a reduction of the coal import tax and measures to make sure the coal is used for industrial purposes such as cement, steel and potash production or energy generation, rather than being diverted for domestic and household use.
It is also necessary improve the road network for potash exports to Asean countries and China. Railway development and national road improvements are also required to facilitate bauxite production.
Export of raw ores will be reduced and they should be processed and exported as refined or semi-refined products.
Facilities will also have to be built for the energy developers to cooperate with alumina-aluminium producers on the use of low cost energy for alumina production in the future.
The Lao Cement Producers Association reported recently that coal consumption in Laos may increase by up to 700,000 tonnes per year over the next four years and is set to grow even more after that.
The demand for coal is increasing as many new cement factories will be built in the coming years.
The 700,000 tonnes will include about 600,000 tonnes for industrial cement production.
The remaining 100,000 tonnes will be used as fuel in the production of bricks, tapioca, to melt ore and other purposes.
The 700,000 tonnes will also include imported coal of about 300,000 tonnes annually to be used for the cement industry.
However, the 700,000 tonnes will not include the coal needed for electricity generation at the Hongsa power plant.
Currently the cement industry sector imports about 200,000 tonnes of coal from Vietnam and Indonesia each year due to the local supply not being sufficient. The sector imported 100,000 to 150,000 tonnes of coal in 2012 and 2013.
