According to the current state of knowledge, coal is produced in nature by the so-called “carbonization” of plant parts. The biological material is initially transformed into peat in the absence of air by squeezing of pore water and biochemical processes and with further progression transformed by a diagenetic process gradually into lignite. With greater pressure and higher temperature, geochemical processes transform the lignite into various types of black coal up to anthracite, in extreme cases up to graphite [Riedel, 6]. In this progressive coalification, the percentage of carbon content increases, while the percentage of so-called volatile components (hydrogen, oxygen, etc.) decreases. According to another opinion, black coal does not arise from lignite but develops independently, based on different microbiological processes [Schmidt/Romey, 19].
Low-grade coals still show organic structures (e.g., cell walls). In anthracite an organic origin is no longer detectable with the microscope [Riedel, 7]. During the process of coalification, the larger hydrocarbon molecules of plants are broken down into smaller molecules. Coal is a heterogeneous mixture; a coal molecule in the strict sense does not exist. Instead, the term “coal molecule” signifies linked modules (e.g., aromatic clusters of two to five condensed rings), which can occur in coal [ibid, 7].
In every era since the Carboniferous, with its explosion of plant growth, coal is supposed to have formed. Lignite is, as a rule, attributed to the Tertiary (=Paleogene+Neogene), while black coal is mostly attributed to the Permian, as well as to the upper and middle Carboniferous [ibid, 8]. There are exceptions. The Tertiary Pechkohle of Upper Bavaria, for example, already shows resemblance to black coal, while the lignite of the Moscow Basin is Carboniferous [ibid, 6].
The formation of coal described above requires a high bio production rate (subtropical climate) over a long period of time, in which the deposition rate must be higher than the decay rate. Dead plant matter must have little or no contact with oxygen (due to dropping into mud or a swamp), since this hinders the activity of putrefactive bacteria. It also needs to be covered quickly with sediment. With the increasing thickness of the sediment cover, temperature and pressure increase and the process of carbonization begins. If the process repeats, several seams form above each other, separated by layers of sediment [ibid, 9].
The sediment layers between the coal seams often contain marine shells and fossils. Sometimes over 100 coal seams can be found above each other. In the prevailing doctrine it has to be assumed that the plant material deposited in swamps and morasses was covered by salt water and sediments when the land sank down and then while raising again was freed from the sea. Plants resettled the land and again a marsh/swamp must have arisen. This must have happened about 100 times in succession at some places [Velikovsky 1955, 217]. Something like this at such a frequency at the same point is not very likely. Another problem is that many plants which are supposed to have contributed to the formation of coal do not even grow in swamps [ibid, 217].
According to information based on Velikosky, for a one foot thick layer of coal, peat of about 12 feet has to have existed, which in turn requires for its creation a 120 feet layer of plant material [ibid, 217]. Elsewhere, a factor of 30 is mentioned between coal and peat [Corliss 1989, 188]. Waagen only talks about a complete factor of 8:
“The depth (thickness) of undecomposed plant material shrinks together to about one-eighth for the formation of coal” [Waagen, 372, translation AO]
Standardized information on this issue is hard to come by. Extrapolated to a not entirely unusual coal seam of 20 meters thickness, a layer of plant material 160 meters high is required according to Waagen or more than 2,400 meters according to Velikovsky. The existence of such plant lots, even with the smallest factor used, and in only one growth season without the associated ground on which they could grow seems again highly unlikely. In most cases only marine sediments are found between the seams. Normal earth is simply missing. In addition, coal seams show vertical bifurcation, which are difficult to explain with the swamp/peat theory [Velikovsky 1955, 219].
Therefore, another explanation was also taken into account, namely that flooding rivers could have massively accumulated trees and other plant material at appropriate locations. The river would also have covered the plant material quickly with fresh sediment. Contrary to this are findings of marine shells, animals, and especially clear water sea corals in the intermediate layers of sediment [ibid, 218]. Problematic are also tree stumps within the coal seams in their original growth position with the roots in the soil that did not rot and did not turn into coal [Cardona, 42]. Why were the many fossils in the sedimentary layers between coal seams not turned into coal too [ibid, 44]?
Alternative theories on the development of coal must also explain the findings of dinosaur footprints on the surface of coal seams in Utah. How can such an impression be preserved over millions of years if one considers the compression rates mentioned above and that the base material of the seam must have been already covered, otherwise it would have rotted away [ibid, 46]?
Technically however, provided enough pressure and temperature is available, plant material can be transformed within hours into charcoal [Illig, 779]. Fire is another way to produce charcoal [Cardona, 48]. Even by heat alone, under normal atmospheric pressure, coal has already been produced artificially [ibid, 44].
Next: Development of petroleum 
Cardona, Dwardu (2009): Primordial Star; Victoria BC
Corliss, William R. (1989): Anomalies in Geology: Physical, Chemical, Biological.
A Catalog of Geological Anomalies; Glen Arm
Illig, Heribert (2006): Nachtarock zu Themen im Heft; Zeitensprünge 18 (3) 777-780
Riedel, D. (2009): Kohle ist nicht gleich Kohle; Praxis der Naturwissenschaften – Chemie in der Schule 58 (1) 6-9
Schmidt, Karl-Heinz / Romey, Ingo (1981): Kohle – Erdöl – Erdgas. Chemie und Technik; Würzburg
Velikovsky, Immanuel (1955): Earth in Upheaval, Garden City
Waagen, Lukas (1914): Unsere Erde. Der Werdegang des Erdballs und seiner Lebewelt, seine Beschaffenheit und seine Hüllen; München