Origin Energy chief executive Grant King thinks difficult times for Australia’s coal industry could continue as the US boosts coal exports in the years ahead.

Mr King says the rising use of gas in the US for electricity generation has meant coal previously used to generate power is being exported to offshore markets such as Europe and, increasingly, to the Asia-Pacific region.

This increased supply has not only depressed the price Australian producers receive for their coal exports, but also dented investment in coal projects.

“The coal mining industry has gone from boom – I won’t go as far as to say bust – but clearly projects are not proceeding,” Mr King told the 2013 stockbrokers conference in Sydney on Friday.

“Capital projects that were planned and would have been thought to have proceeded as little as a year or two ago are not proceeding.

“The competitiveness, if you like, and even the profitability of many existing coal mines is now challenged as coal prices are sitting somewhere around that $85-90 a tonne for export.”

Mr King said there had been an “enormous withdrawal of capital” from the coal sector in recent times as “mines are being closed” and workers needed to find new jobs.

The Origin boss noted there were many more workers available for the company’s LNG project in Queensland than he initially thought would be the case.

While coal was facing challenges, Mr King said the peak of investment in liquefied natural gas (LNG) was yet to occur.

“As we look to the back half of this decade – that is 2015-2020 – Australia will emerge as probably the largest producer of LNG in the world,” Mr King said.

“That is an extraordinary development in Australia.”

LNG was set to become Australia’s second largest export behind iron ore, and contributed a significant amount of income to the national economy, he said.