While several coal-mining juniors are experiencing severe funding woes and coal miners across the globe appear to be finding little respite in the current low oil prices, coal giant Glencore envisages that demand will catch up with supply before the end of the year.

On the junior front, South Africa-focused coal developer Zyl, which is listed in Australia, told the ASX that it was going into voluntary admini- stration after failing to secure long-term financing.

Earlier, the Aim-listed Beacon Hill, which operates the opencast Minas Moatize coking coal operation, in Mozambique, informed the London Stock Exchange that it had appointed an insolvency practitioner to advise on the potential requirement for it to go into administration “in the near term".

In addition, TSX-listed Corsa Coal told the Toronto Stock Exchange last week that it would be cutting a quarter of its permanent workforce in the Northern Appalachian division, citing weakness in the global metallurgical coal market.

Simultaneously, the South Africa-focused ASX-listed Continental Coal last week agreed to revised terms from a new buyer of its 74% interest in South African subsidiary Continental Coal Limited South Africa.

In Zyl’s case, the holder of the security over its assets – Prestige Glory – has entered into an agreement with Ascent Capital Holdings, which will result in everything apart from the Kangwane South project being transferred to Prestige to cover secured debt.

Corsa’s elimination of 130 full-time Northern Appalachian division positions will result in the company’s Kimberly Run and Barbara mines being idled and placed under management review for closure, and the top brass of the financially stricken Beacon Hill have told the London Stock Exchange that the company’s working capital would have run out by January 15. Emailed Mining Weekly questions and telephone messages left for Beacon Hill had not been responded to at the time of going to press. Headquartered in Pretoria, Beacon Hill late last year fell 6% short of the requisite 75% shareholder support threshold to allow it to proceed with a remedial funding plan.

Meanwhile, highly experienced Peter Freyberg, CEO of the giant Glencore Coal, foresees coal demand improving before year-end. Addressing Glencore’s investor day, Freyberg made the point that coal is not in the same oversupply position as iron-ore and that thermal coal is, in his view, heading towards a supply deficit, as is reported on page 14 of this edition of Mining Weekly. A graphic of consensus price forecasts, displayed during the investor day presentation, shows coal in positive price territory in late 2015. The London-, Hong- Kong- and Johannesburg-listed mining and marketing company has an installed capacity on a managed basis of close to 200-million tons of coal a year, across 22 mining complexes in three countries and backed by marketing offices in 19 countries. It has cut $1.8-billion out of its costs since 2012 and its new production is firmly in the first quartile of costs, including its below-budget R8-billion Tweefontein Optimisation Project, in South Africa, which is being commissioned six months ahead of schedule. Glencore sees an opportunity to create value by switching in and out of domestic markets, which it is already doing in Australia and which it envisages will also be done in South Africa. The company has also succeeded in unlocking hundreds of millions of dollars a year in the synergies created through coal blending. “Natural tightening, where demand actually catches up with supply, will happen in the near future,” says Freyberg, who adds that coal remains fundamental to Asian energy demand.