Stoke are desperate to offload Beattie in the coming months and it had been suggested in one national newspaper that they were willing to let him leave for nothing, just to get him off the wage bill.
However, Coates has dismissed that possibility so West Brom will have to set aside around £2million - the initial fee Stoke paid Sheffield United for the striker in January 2009 - if they decide to firm up their interest with a bid.
Coates told the Stoke Sentinel: "There is absolutely no chance (of Beattie leaving on a free transfer). We value him as a player and, if he were to leave, we would expect a sizeable fee."
Beattie made a terrific impact after joining Stoke, scoring seven goals in 16 games to help the club to comfortable safety in the Premier League two seasons ago.
He made just 13 starts over the last campaign, though, and not a single one in the league after a dressing room bust-up with manager Tony Pulis at Arsenal in December.
Coates still believes the 32-year-old can do a job in the Premier League, though, and he expects there to be interest in the striker.
"We will get approaches for James Beattie so we will see how things develop between now and the start of the season," he said.
"Clubs are bound to be interested because he is a goalscorer and they are hard to find.
"Everyone is looking for them. It is the most difficult job in any football club to fill.
"The fact he is a year older makes no difference. He has never relied on his pace, but he has always had the ability to score. He has lots of football ahead of him."
Stoke are looking to offload Dave Kitson as well as Beattie and speculation is mounting that Pulis will bid £2million for Aston Villa striker Emile Heskey as one of their replacements.