Whitehaven was considered the best of the producers, with the investment bank looking for low-cost miners with valuation support and funding.

“Whitehaven is our top pick, with cash generative operations and one of best low-cost development projects available in the 10.8 million tonnes per annum semi-soft/thermal Maules Creek mine ($A767 million capex cost for a 10mt mine, $67/t operating cost),” Credit Suisse said in its Australian coal sector update report.

“Construction is ready to begin and funding is secured through a $1 billion, four-year debt facility.”

While it also had an outperform rating on Tiger Realms Coal, despite some uncertainty from a Takeovers Panel case that emerged days before Christmas, Credit Suisse rated Aquila more strongly.

“Aquila probably has the single best coal project among our explorers, the 4.5mtpa Eagle Downs joint venture (50:50 with Vale),” it said.

“The mine is under construction (first coal 2015) with drift contracts recently awarded. With close to $600 million cash, Aquila is capable of funding the bulk of its equity share of the $1.25m billion initial spend.

“Catalysts include 1) a sell-down of Eagle Downs and an updated definitive feasibility study, 2) progress of the $94 million insurance claim from Isaac Plains [mine] or 3) possible monetisation of Thabazimbi, a 2-4mtpa iron ore project in South Africa.”

Credit Suisse said it had a hopeful coal outlook despite “dismal share price performance” from coal stocks over the past two years.

“We believe new projects need to begin construction soon to supply growing demand in the medium term.

“We do not expect China, India or developed Asia to dramatically change or reduce its dependence on coal. That provides opportunity as there are currently few projects progressing in Australia, with the majors cutting costs in marginal divisions and juniors struggling with funding.

“With a weakening domestic construction market, contractor rates are coming down and mining companies can increasingly transfer construction risks to the contractor. In our view, the current environment provides one of the best opportunities to generate a solid return from new projects. Of course, it does require faith in improved coal pricing as no project we are aware of offers value at spot coal prices.”

Chinese coal demand helped pull Australia’s coal scene out of a lull in 2009 and Macquarie Private Wealth believes that environmental issues in China could help this year and beyond plans to reduce reliance on high ash, high sulphur thermal coal.

“Steel mills under pressure to reduce emissions are turning to more direct charge iron ores (lumps and pellets), more higher grade iron ores and are trying to reduce coal consumption per tonne of steel produced, which potentially drives demand for better quality coking coals,” MPW said among its commodities comment report on key themes for 2014.