99. HOW FAST CAN WE MINE COAL?

The reserve/production (R/P) ratio is often used as a shorthand way of indicating how long current reserves will last at current production rates. The peak oilers often criticize this ratio (and rightfully so) because it fails to take growth into account. For example, at present the U.S. has about 270,000 million short tons (MMst) of coal, and a production rate of about 1,000MMst per year. Dividing, we obtain an R/P ratio of about 270. This is where the sound bite "we have more than 200 years of coal left" comes from. It's true that this neglects the effects of growth in demand, but it also neglects the effects of growth in reserves (which occurs as previously uneconomical deposits become exploitable due to higher prices and improved technology). The R/P ratio definitely has defects as an indicator of how long a reserve will last, but it is useful for reducing a large reserve number to a human scale. It's a lot more comprehensible to the layman to say "we have 270 years of coal left at current mining rates" than to say "we have 270 billion short tons of coal reserves". In that sense, the R/P ratio is useful.

That said, let's take a different tangent. Let's look at the reciprocal of the R/P ratio -- i.e. the P/R ratio. This ratio is interesting because it gives an indication of how fast coal can be mined. Granted this is a rough estimate, but it seems reasonable to conjecture that the maximum speed at which a country can mine coal (in MMst per year) is a function of the size of that country's reserves.

The following Table gives the P/R ratios for all countries which are significant players in coal mining. Reserve figures are recoverable reserves as of 2002 from the DOE's Annual Energy Review 2004 (P. 323). Production figures are from 2003, obtained from the same Annual Energy Review (P. 325), and the DOE international coal production spreadsheet located here(excel file). Reserve figures are given in MMst, and production figures are given in MMst/year. Click on the Table for a clearer view.Some countries, like Brazil, Pakistan and Russia, have substantial coal reserves which they are exploiting at a very low speed. In terms of R/P ratio, Brazil's reserves will last for about 2,000 years at the current rate, and Russia's massive deposits will last for about 590 years. As noted above, the figure for the U.S. is about 270 years. On the other hand, we have countries which are mining at high speed like the Czech Republic (see #36), China, Germany and the UK -- which have R/P ratios of 87 years, 77 years, 32 years and 8 years, respectively.

A common doomer argument is that coal will not be able to save the day because it cannot be mined fast enough, but these numbers give us a rough indication of how fast coal can be mined. For example, the U.S. currently mines 1,072MMst/year. If the U.S. were to mine coal at a rate comparable to that of China (the world's largest coal producer), the figures indicate that the U.S. could mine 3,507MMst per year, or roughly 3 times what it is mining now. That's a lot of coal. In fact, on a btu basis, it is almost enough to replace all primary energy currently provided by oil and natural gas. On the other hand, if all of that coal were liquefied at the usual thermal efficiency of 65% (see the coal liquefaction energy flow diagram in #94), it would be equivalent to about 22 million barrels per day of liquid fuel -- i.e. roughly the amount of oil which the U.S. consumes today.

The situation can be furthered improved if the U.S. adopts a nuclear electricity strategy like that of France (see #42). If nuclear generators are installed to eliminate coal generators, natural gas can be substituted with coal gas, and oil can be substituted with coal liquefaction (see #43). In this way, the entire economy can run on nuclear power and coal.