Flexi Says: Coals forms around the sea in environments like coastal marshes, back-barrier swamps, and inter delta wetlands. Coal forms from peat, a spongy accumulation of organic material that has not fully decayed. As the peat is buried by overlying sediment and subjected to increased temperatures and pressures, it undergoes a physical and chemical transformation into coal. This transformation causes the carbon in the coal to become more concentrated and decreases the amount of water, oxygen, and hydrogen present.