Posted on 10/09/2019 6:49:45 AM PDT by buckalfa
LOGAN, W.Va. — Three underground coal mines and two preparation plants in Logan and Mingo counties have been idled by Kentucky based company Blackhawk Mining and its subsidiaries.
Blackhawk announced Tuesday afternoon saying the affected operations are the Washington Underground Mine, Muddy Bridge Underground Mine, Buffalo Underground Mine, Fanco Preparation Plant and Loadout in Logan County and Mingo 1 Preparation Plant and Mingo 2 Scaggs Loadout in Mingo County.
“It’s sad and it’s disturbing,” Bill Raney, the President of the West Virginia Coal Association told MetroNews of his reaction to the news.
“It’s just a matter that the coal market is what it is. It’s an international marketplace.”
Raney said it’s simply the reduction in supply that led to the closings, that Blackhawk said will result in 342 individuals losing positions.
“Nobody is bothered by it more than the folks at Blackhawk,” he said. “That’s the last thing in the world they wanted to do. When the price of the product doesn’t meet what it costs to produce then you just can’t keep producing it.”
Raney added that coal companies are not making as much as years past because of all the metallurgical coal and steel coming from China and around Europe. He said that coal plants have become a target to shutdown so steam coal is not what it ought to be or used to be.
“You combine all of that and think about all the coal on the ground at the mines as well as the ports on the east coasts and the gulf then all of that complicates everything,” Raney said. “With so much coal available now, it’s just the price is down.”
The operations idled primarily produced High Vol A metallurgical coal for sale to domestic and international coke makers and steel producers, officials said, producing approximately 1.3mm tons of coal in 2018.
Blackhawk Mining said in a release that while Worker Adjustment and Retraining Notification Act (WARN) notices were sent to 342 employees, each affected employee will be encouraged to apply for open positions elsewhere within the company.
Permanent workforce reductions associated with the WARN notice are expected in early December.
The company stated recent weakness in global coal markets, and the corresponding drop in prices to three-year lows is the reason for its decision.
Blackhawk is also idling operations at the No. 8 Underground Mine, a contract mine in Mingo County.
Unstated are the supporting business downsizing. That would be tire vendors, Catipiller maintenance facilities, mining machinery maintenance companies, truck dealers and on and on and on.
Then, there are the local governments, especially schools that directly feel the pressure........ bad news all around
I say mine it and store it like the strategic petroleum reserve. Take a cut in pay and eat a little crow. Probably not the smartest idea but the market could come back.
There’s also the fact that *the* major world consumer of coal, China, is moving to nuclear and natural gas because even they don’t want the radioactive ash of burning coal everywhere any more. (They were using coal in unfiltered individual home/business heating use as well as for energy generation.) The Obama regulations didn’t help either.
Unfortunately, I think the steam coal industry is something we can’t really prop up without major physical and political ramifications. I suspect the best middle way would be to offer miners aid in converting to other mining industries, fast track other type mines (such as rare earth) to break China’s stranglehold on those substances, and other such assistance for workers. Steam coal is not a militarily required substance any more, so there’s no justification for that - I think steam coal is pretty much doomed anyway.
The steam coal market is on the way out now anyway, for better or worse.
There’s also no point to storing the stuff. We don’t need it for national security.
Coal is dying with the meteoric rise in natural gas. Coal fired plants are early 20th century technology and with EPA regs, unions, international price fluctuations...can you say buggy whip business.
Or, put another way - you are wanting to stockpile ink blotters in an era where smartphones, PCs and typewriters exist. Or stockpiling musket ramrods in a world where pretty much everyone has gone to centerfire metallic cartridges. Technology basically has moved on.
Not to mention the avalanche of cheap coal being dumped on us from China and Europe. It’s too late now, but somebody dropped the ball (or were paid off) when the coal import/export rules were agreed to. Once again, the American worker takes it in the shorts!
I’m surprised nobody has mentioned one particular political party has vowed to put the coal industry “out of business”.
One reason the imported coal is so cheap is because nobody over there wants or needs it either.
“When the price of the product doesn’t meet what it costs to produce then you just can’t keep producing it.”
Business 101.
350 years of proven coal reserves in North America.
Pity we’re walking away.
Coal is in storage. It will remain there until the need arises to mine it.
Fracking killed coal, and it is not coming back.
“...notices were sent to 342 employees,...”
If you were to ask Cankels she would say “Let them code.” If it is market conditions I don’t see what Prez Trump can do.
Wait till the winter hits the sustainable energy dependent EU:-)
Energy costs are down. It is good to leave the coal in the ground rather than sell it cheap. When cost go back up, start digging.
I agree. Some very smart people need to find a way to turn our coal into "gold" cost effectively and with minimal waste. Maybe that's a pipe dream. My late grandfather as a child was a coal cracker.
Locally, we have Eastman Chemical Co and an unlimited supply of coal in nearby SW Virginia.
In about 1980 several of my Eastman engineer friends working I believe with Bechtel co developed a process to convert coal to gas to be used as feed stock and acetate related production. They had additional facilities in Texas where there was abundent gas and shipped liquid feed stock to Tennessee from Texas.
Now, there is a lot of cheap natural gas available from fairly local sources. Eastman put in a new larger pipe line for the gas. They immediately changed over one of the four electric generating units to natural gas from coal. I do not know if their own gas produced from coal is cheaper than the natural gas available locally or from afar. They actually have at least 2 coal gassification plants on line and recently did some major work. Since like me, my buddies are all retired I have no way of knowing. The coal is shipped in by continuous rail car movement.
Very good minds did indeed develop coal chemisal processes. It seems that gas is so very cheap, it might overcome the work they did
Yes.
The availability of any resource is strongly correlated to the relative costs of finding it and mining it. When people talk about “Peak Oil” they assume that at any given time, the location and amount of any untapped oil is known. However, when the price of oil goes down, people don’t look for oil, because that costs money.
When the price of oil goes up, we look for oil so we can drill for it and make money to get back our investment in looking for it, and...voila, more oil is found.
With coal, the Obama administration in 8 years accomplished their goal and killed the industry. However, as you state, Born to Conserve, when it becomes viable, people will begin looking for it again.
There may be technology that will make that feasible, cleaner ways to squeeze that energy out of the coal, and if we ever need it, it will be there.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.