Insights

ASX coal stocks increasingly isolated with rise of start-ups like MGA Thermal

ASX coal exposed stocks are looking even more unloved as the Hunter Valley looks beyond coal through start-ups like MGA Thermal.
The post ASX coal stocks increasingly isolated with rise of start-ups like MGA Thermal appeared first on The Motley Fool Australia. –

miner's hard hat on pile of coal MGA Thermal ASX coal stocks

ASX coal exposed stocks are looking even more unloved as the Hunter Valley looks beyond coal through start-ups like MGA Thermal.

The New South Wales township that was built on the back of the coal industry is sensing a foreboding as the world tries to rid itself from the fuel.

The Australian Broadcasting Corporation (ABC) reported that locals are feeling nervous as residents do not know what work there will be left for their kids.

Hunter on the coal transition path

But Hunter Valley isn’t about to rollover. There’s a view among experts that the Hunter is well placed to secure its future as a sustainable electric powerhouse.

The region’s legacy in coal has left it with extensive electrical infrastructure and easy access to a deep water port.

The locals are also exploring new ways to capitalise on a carbon-free future. The ABC highlighted MGA Thermal as one example with the company using recycled metals to create “bricks”.

Who is MGA Thermal

These bricks are good for storing energy as heat. As MGA Thermal’s Alex Post explained to the ABC:

“We stack the bricks up into large energy storage systems; we heat them with waste heat from industry or with electricity from the grid when we have too much solar, and these bricks store all of that energy as heat.

“Six to eight hours later we can use all that stored heat to drive an industrial process or create steam to run a power plant and put energy back onto the grid.”

Multi-pivots to create new jobs

Even mining services companies in the area that used to focus only on the coal industry are starting to pivot. They are looking at new applications, in areas such as healthcare, to apply their know-how.

The coal-dependent regions of Northern Queensland are also likely to be paying attention. These communities know they have to start planning now while there are still coal jobs to aid the transition.

MGA Thermal sparks questions about ASX coal stocks

There’s little doubt Aussies will find a way, we always have. The key question though is what now for ASX investors in coal stocks.

These include the Yancoal Australia Ltd (ASX: YAL) share price, Whitehaven Coal Ltd (ASX: WHC) and New Hope Corporation Limited (ASX: NHC).

While regions like the Hunter are laying out a transition plan, coal miners have yet to articulate how it will secure the future.

The risk of miners holding stranded assets are real, especially if coal mining communities are looking elsewhere for jobs.

Other ASX stocks exposed to coal

The trio aren’t the only ones on the S&P/ASX 200 Index (Index:^AXJO) that are exposed to coal of course. The BHP Group Ltd (ASX: BHP) share price and South32 Ltd (ASX: S32) share price are also linked but these diversified miners will have an easier time transitioning.

There are also those that service carbon emitters, such as the Worley Ltd (ASX: WOR) share price and Aurizon Holdings Ltd (ASX: AZJ).

Worley is shifting its focus on providing engineering services to renewable energy providers, while rail operator Aurizon doesn’t only haul coal.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Motley Fool contributor Brendon Lau owns shares of Aurizon Holdings Limited, BHP Billiton Limited, South32 Ltd, and WorleyParsons Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia has recommended Aurizon Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post ASX coal stocks increasingly isolated with rise of start-ups like MGA Thermal appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!