If you think coal will come back in the U.S. read this

The future of the coal in the U.S. will depend on whether OPEC or the oil majors are right when it comes to the liquids contribution from U.S. shale  post 2025. OPEC expects shale growth to slow after 2023, causing U.S. output to peak at 14.3 million barrels a day by 2028. OPEC then expects U.S. production to fall to an average of 12.1 million barrels a day by 2040. IEA expects shale production to plateau in the mid-2020s, ultimately falling by 1.5 million barrels a day in the 2030s due to resource constraints.

 Exxon and Chevron, now two of the most significant players in the Permian, are much more optimistic even under lower oil price scenarios. The two majors are expected to produce close to 2 million barrels of oil equivalent a day combined from the Permian by the mid-2020s, effectively tripling their 2018 output. Chevron plans to increase production to 600,000 barrels a day by 2020, reaching 900,000 barrels a day by 2023. Exxon, meanwhile, expects its Permian production to hit 1 million barrels a day by 2024.

Shale investment is low and the returns are seen very quickly. Exxon reports that wells in the Permian are capable of delivering returns of more than 10 percent at an oil price as low as $35 a barrel. Chevron owns most of its land outright and is looking at even higher returns. Both companies see continuing growth past 2025 due to the fact that the amount of oil recovered to date is less than 10% of the potential.

Royal Dutch Shell and BP are also building prominent positions in the Permian. This group has the financing to create the necessary infrastructure including pipelines, for production of associated natural gas.  They can also invest in the refineries and petrochemical facilities to process the surplus of light, sweet crude and associated gas that shale basins generate.

It is therefore likely that U.S. liquids production could reach 25 million barrels/day by 2025 at a price of $55/barrel and that it will not nosedive thereafter. Under this scenario, it will be very difficult to justify any new coal fired plants. There would be accelerated retirement of the 200,000 MW of coal plants now in operation.