December 9, 2010

In the time since former Mircrosoft CEO Bill Gates and Berkshire Hathaway’s Warren Buffet were caught by local papers having a private tour of Arch Coal’s Black Thunder mine, there have been more and more rumors and speculations that Berkshire Hathaway may be about to make a play in coal.

While coal stocks have been performing significantly better than the market at a whole, Arch Coal itself was not among the highest performing coal stocks. In fact, today Citigroup analysts downgraded their rating of Arch Coal from “buy” to “hold”.

Read article at http://finance.yahoo.com/news/Will-Buffett-Trade-His-Cash-indie-1385877404.html.

December 9, 2010

The House has just approved significant funding increases for both the Mine Safety and Health Administration (MSHA) and Federal Mine Safety and Health Review Commission (FMSHRC). The FMSHRC is the body in charge of processing appeals to citations issued by MSHA, and the increase in funding of $5.3M will help them hire 10 new administrative law judges to clear the backlog of appeals (currently at about 19000 cases). MSHA was awarded an additional $24M, of which $15M will go towards reducing backlogs.

Backlogs in the appeals system have made news recently because they have made it more difficult for MSHA to enforce their “pattern of violation” authority because cases under appeal couldn’t be counted in the pattern. The Robert C. Byrd Mine Safety Protection Act, defeated by House Republicans yesterday, was aimed primarily at closing that loophole.

Read article at http://blogs.wvgazette.com/coaltattoo/2010/12/09/house-approves-more-mine-safety-funding/

December 8, 2010

Lawyers for Massey in the Upper Big Branch tragedy have accused of MSHA lawyers of “blaming the victim” (Massey), have accused Administrative Law judge Margaret Miller of “unequivocal antagonism”, and claimed that it was a legal error to consolidate all of the cases into her court. The dispute with Miller seems to step from her decision to rule for MSHA in establishing the investigation protocols. In that ruling, Miller said “Performance’s documents exaggerate and misrepresent the facts, and make little attempt to address the legal issues that are being raised. Instead, Performance treats this Court as a forum for grandstanding and, in doing so, attempts to interfere with the ongoing investigation.”

Read article http://blogs.wvgazette.com/coaltattoo/2010/12/08/massey-vs-judge-miller-who-is-the-victim-in-the-upper-big-branch-mine-disaster-investigation-case/

December 8, 2010

The New Elk Mine in southeastern Colorado, is about to reopen after being closed for several decades, bringing up to 400 new jobs to the economically depressed Las Animas county. However, the miners themselves will not be hired locally: “Mining is a highly skilled job and no one around here has worked in a mine in 20 years,” said Kim Schultz, executive director of the Trinidad and Las Animas County Chamber of Commerce.

Toronto-based Cline Mining Corp. plans to mine 2-3 million tons per year of the estimated 350 million tons in the mine. New Elk is significantly different than neighboring mines in the Powder River Basin in Wyoming, because it has coal of a high enough quality to be used for coking. Recently PRB coal has sold for around $12/ton, whereas coking coal is up to $156/ton. Cline estimates a significant portion of the mined coal will end up in Asia. Production is expected to restart this calendar year.

Read article at http://www.denverpost.com/business/ci_16803352

December 8, 2010

The GOP voted today nearly unanimously to block the approval of the Robert C. Byrd Mine Safety Protection Act. Shelley Moore Capito (R-WV) said the Act “does little to address mine safety, but rather imposes severe penalties on businesses, introduces dramatic regulatory changes, and promotes unnecessary litigation which will hurt those mines and miners operating in good faith on behalf of worker safety.”

House Labor Chairman George Miller (D-CA) described the bill as essential to close the loopholes surrounding the “patterns of violations” authority that MSHA has had (but never exercised before this fall) for a number of years. He specifically cited the Upper Big Branch mine as a case in point of a mine with a huge number of violations that avoided POV sanctions by “indiscriminately” appealing all decisions against it. “The bill sets clear and fair criteria to identify mines with significant safety problems and eliminate the incentives for mine owners that game the system. Had this been in place, I believe the 29 miners who lost their lives at Upper Big Branch would be alive today.”

Read article at http://blogs.wvgazette.com/coaltattoo/2010/12/08/gop-kills-effort-to-resurrect-mine-safety-bill/

December 8, 2010

An Australian company is proposing to build two plants to dry Powder River Basin coal raise its BTU content. PRB coal is 30% water by mass, and by removing that water the coal becomes more economical to ship oversees and to replace higher quality bituminous coal from Appalachia. While there have been a number of companies who have failed at this in the past, White Energy’s technology for producing coal briquettes is considered tested and proven, enough so that the current plans are to build commercial scale plants instead of test facilities.

White Energy proposes a plant at Buckskin and another at Caballo, both opening in 2013 with an initial annual production of 1 million tons each (though expandable to 8 and 20 million tons per year respectively). The company expects to receive about $2 per BTU more than the untreated coal.

Read article at http://www.gillettenewsrecord.com/articles/2010/12/08/news/today/news02.txt

December 7, 2010

Union Pacific is reporting a small increase in the number of coal-trains leaving the Southern Powder River Basin in November 2010, compared with the same period the year before (968 trains per day versus 939). During the same period, loadings in the Utah/Colorado region dropped from 245 to 189.

Read article at http://www.progressiverailroading.com/news/article/UP%E2%80%99s-PRB-coal-train-loadings-climbed-in-November–25200

December 6, 2010

The year end forecast by Black and Veatch, an energy consulting company, projects that in the next 25 years the percentage of electrical energy generated by coal will dip from today’s 48% figure down to 22%, while the share generated by natural gas will nearly double from 21% to 40%. The remaining shift in generation results from a 3x increase in the fraction generated by renewable energy options such as solar and wind (from 4% to 11%); nuclear power production is expected to remain flat at 21%.

The changes seemed to be related to two major trends: improved natural gas reserves because of new pipelines coming on line and an increase use of “fracking” to recover more gas from existing sites, and a predicted 16% of all coal-plants closing in the next decade because of increasingly stringent emissions rules. However, the reports authors are quick to point out that their crystal ball is murky at best. For one thing, stricter water regulations might limit the use of fracking to recover natural gas and upend their analysis.

Read article at http://www.greentechmedia.com/articles/read/does-the-future-of-power-belong-to-natural-gas/

December 6, 2010

The US Supreme Court has agreed to hear a case to determine whether to overturn a ruling that lets states and environmental organizations can sue utilities over greenhouse emissions under “public nuisance” laws. Brought by New York City, the states of California, Connecticut, Iowa, New Jersey, New York, Rhode Island, Vermont, and Wisconsin and several environmental groups, the lawsuit is an attempt to decrease the emission of greenhouse gases without waiting for federal authorities to act.

Read article at http://www.grist.org/article/2010-12-06-u.s.-supreme-court-to-hear-key-global-warming-case

December 5, 2010

The Montana Coal Board met in Billings and handed out nearly a half-million dollars in grants to a number of organizations, most notably $160,000 to the Northern Cheyenne tribe to help fund a renovation to house a new administrative building, and $118,000 to the city of Colstrip to help them repair one of the major roads used by the Colstrip mine and several coal-fired power plants.

The Montana Coal Board takes a portion of the taxes the state receives from mining and puts them to use helping communities with the cost of mining-related infrastructure in Eastern Montana.

Read article at http://billingsgazette.com/news/state-and-regional/montana/article_ea2b1634-69cf-50f1-92af-14d0d708a8af.html