China has approved the merger of two of Shandong province’s top state-owned coal miners, Shandong Energy Group and Yankuang Group, a decision that effectively creates a new top company in the world’s top producer and consumer of the fossil fuel. The combined company, China’s second-largest coal producer after China Energy Investment Corporation (CEIC), will operate under the name Shandong Energy Group. It’s expected to account for close to 7% of the country’s total coal output Gewin Ho, a Moody’s vice president and senior credit officer, said that because the combined group will derive most of its businesses from coal mining, its credit profile will remain constrained by significant carbon transition risk and by its exposure to coal-price volatility. “While support from the Shandong Provincial Government should remain forthcoming, it will be constrained by the predominantly commercial and competitive businesses of the combined group,” Ho said in a July note […]