Modern economic POTENTIAL OF UKRAINE

Back to "Industry"

Coal industry

Coal is one of the primary domestic sources of energy for Ukraine. Coal extraction in Ukraine grew till 1976, and then declined. In 1991-2004 the production capacities of coal extracting enterprises dropped almost 2.2 times. In recent years, production was only at 79% of capacity.

Today coal is being extracted in old mines and under hard mining and geological conditions. Almost 96% of mines have seen no reconstruction for over 20 years, and more than 50% of coal production equipment is worn out completely.

The high cost of Ukrainian coal requires that the industry be subsidized by the State budget.

To meet the growing demand of Ukrainian consumers for coal products and in the light of the required stage-by-stage transfer to the utilization of domestic resources, there are two directions for the coal industry’s development.

According to the first option, production capacities by 2030 will grow to 124.4 mn tons per year, with a use rate of 90%. Coal production volume would increase to 112.0 mn tons, which will satisfy national demand by only 76.5%. Around 30.6 mn tons of coal will be imported, including 18.3 mn tons of power-generating coal and 12.3 mn tons of coking coal.

The second option forecasts a rise in production capacities by the end of 2030 to 144.4 mn tons per year, with the same use rate, which will bring coal production to 130.0 mn tons or 88.8% of the forecast need. This will lower coal imports to 14.6 mn tons, including 2.5 mn tons of power-generating coal and 12.0 mn tons of coking coal. This option requires the timely replenishment of mine stock through raising the technical and technological level of coal mining companies and the construction of new mines with a corresponding increase of capital investments.

In the first stage of this option (2006-2010), a set of problems should be solved to develop mine stock. First is the replenishment of the technical and technological basis and its further transfer from state to commercial ownership. To accomplish this, 17.0 mn tons of new production capacities should be launched via the completed construction of the second stages at three mines, the reconstruction of working coal mining enterprises accompanied by the acceleration of facilities improvement and increasing the use rate to 86%. Also, starting in 2006, the construction of three new mines, which began before 2001, should be re-started.

In the second stage (2011-2015), 8.8 mn tons of production capacities should be put on line through the completed construction of the three mines, the reconstruction of working coal mining enterprises accompanied by the acceleration of facilities improvement. To ensure the refurbishment of capacities for the future, the large-scale construction of seven new mines should begin in 2011, with the rate of production capacities’ utilization being brought to 90%. This will require corresponding financial support and technical refit of each mine construction complex.

Over the third stage (2015-2030), production capacities should grow to 144.4 mn tons per year, which requires the timely reconstruction of working coal mining enterprises accompanied by an acceleration of facilities improvement and the construction of new mines after 2015 at explored coal deposits with favorable mining and geological conditions.

Back to "Industry"