Laura Vermeulen

Northwest Colorado coal production decreasing

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Jim Mattern

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Stuart Sanderson

The coal industry was once in a time of high optimism, riding a wave of “robust” production levels, Colorado Mining Association President Stuart Sanderson said.

The year was 2004, and the state’s coal industry was producing 40 million tons of coal.

“At that point in time, it looked as though we had the potential to hit 50 million tons,” he said. “Demand for energy was increasing and the export markets were robust.”

But, that didn’t last for long.

Now, Sanderson said the opposite is true, and coal production levels are slipping.

Since 2006, coal production in the state has dropped from 35.4 million tons to 28.5 million tons last year, according to statistics from the Colorado Division of Reclamation, Mining and Safety.

This year’s coal production numbers aren’t looking much better, Sanderson said.

“The economy, having gone through a period of decline, has had its impact on demand for coal as well as the uncertainty in governmental regulation,” he said. “I know that there are operations that have to consider what impacts governmental regulation will have on mine expansions … and there is a fair amount of uncertainty that has slowed growth.”

Northwest Colorado’s three mines — Colowyo Coal Co., Trapper Mining Co., and Twentymile Coal Co. — have all experienced recent production declines, according to statistics.

Colowyo’s coal production levels are down about 2.9 million tons from 2006. In 2009, Colowyo produced 3.4 million tons of coal, down from 6.3 million in 2006.

Through August of this year, Colowyo has mined 1.7 million tons of coal. Last year, through August, the mine produced 2.2 million tons of coal.

Trapper’s production levels haven’t decreased much, from 2.4 million tons of coal in 2007 to 2.1 million tons last year.

Through August of this year, Trapper has mined 1.4 million tons of coal, which holds steady to production levels through August of last year.

Twentymile coal production levels are down about 700,000 tons from 2006. The Routt County underground mine produced 7.8 million tons in 2009, down from 8.5 million tons of coal in 2006.

Through August, Colorado mines have produced a combined 16.9 million tons of coal, which is down about 3 million tons from the same period last year. Through August of last year, Colorado mines produced 19.9 million tons of coal.

Sanderson said Colorado has also recently fallen out of the top 10 of coal producing states.

Jim Mattern, Trapper president and general manager, said much of the coal industry’s production declines come from the economic slump.

“We are still in a recession, and so that is not helping matters at all,” he said. “I would guess that (production) would be in the same ball park plus or minus a couple percent from where we were last year.”

Although the in-state coal market remains somewhat steady, Sanderson said, Colorado’s coal export market to other states fell to 16 million tons in 2009, a decline from recent years.

“That could be any number of factors — like the utilities in the East and Midwest finding that they have the ability to obtain coal from other sources,” he said.

But, Sanderson said his “big concern” is the recent passing of Colorado House Bill 10-1365, also known as the Clean Air, Clean Jobs Act, and how the legislation would affect coal production.

Sanderson said Xcel Energy, which owns several coal-fired power plants affected by the bill, estimates the bill could displace up to 4 million tons of coal per year.

The notion that the displaced coal could be resold in export markets “is bogus,” Sanderson said.

Mattern agreed.

“That is definitely going to be to the detriment of the industry and the communities that those industries serve,” he said of H.B. 10-1365. “But, hopefully we can make some of that up with a higher demand for electricity and coal.”

Although he said it was hard to put a timeline or number on it, Mattern believes that as the economy improves, demand for electricity and coal will increase.

Sanderson shared the sentiment, and agreed it would be hard to estimate this year’s final production numbers or future state production levels.

“But nationally, I think things are looking a little brighter from where they had been,” he said. “The coal producers … have reported a bit stronger demand coming out of the recession.”

But, Sanderson said he remained “very guarded” in talking about coal mining’s future in Colorado because “our government’s policy is so hostile to mining here.”

“Particularly through the enactment of House Bill 1365, quite frankly legislators proved that they were willing to bargain away the interests of Colorado rate payers, the interest of the citizens of Northwest Colorado and the coal-producing regions, and to bargain away their obligations to try to promote the economy by the passage of this bill,” he said.

Comments

justateacher 3 years, 5 months ago

I taught many students whose parents were employed in the coal industry; so I think I understand the sensitivity of this issue.

But shouldn't Craig be looking at something beyond Coal?

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cmawest 3 years, 5 months ago

craig will never get over its boom/bust mentality. there are, as always, a handfull of people who run everything and think they control everyone. they jump at energy booms because they stand to make a buttload of money from it.

yes, you are correct. craig needs to look for sustainable things to help its economy. there are a ton of retirees that would love to come to craig just for the hunting and fishing. they bring with them good incomes that spend in the stores as well as anyones, but alas, they can't move here because craig has about the most overpriced real estate in the state.

so, craig will just always be craig. the old names in town will control your jobs, people will allow their homes to fall into foreclosure, and like always, in a few years it will have busted to the bottom once again. you will be able to buy a home for $10,000.00 and the cycle will start up again, over and over, and over. oh well, heck, its craig, right ?

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als362 3 years, 5 months ago

You might be correct about people coming here for the fishing IF the US Fish and Wildlife Service, the DOW and Colorado University would quit ruining the game fishing in the Yampa River. Far too much money has been wasted on this project. All it does is hurt our local ecomony. I believe if the same amount of money that is now spent taking game fish out of the river, were used to make game fishing better, the small mouth bass and pike fishing in the Yampa River would be some of the best in the US if not the world. Also walleye need to be stocked in the river and Elkhead. Then people would come to this area for the fishing, and it wouldn't matter what the real estate prices were. Also many new businesses would open in this area promoting the fishing selling goods, providing services and employing people. But none of this will happen until the afore mentioned groups leave us and the river alone.

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rhammel 3 years, 5 months ago

cmawest,

I am one of those retirees. But I came here when prices were down. So all I have to pay is food and taxes, of which both are getting out of hand. But I wouldn't move back to the city, even if I were offered $50 per hour! I don't fish much any more, but I sure take a lot of photograghs!

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John Kinkaid 3 years, 5 months ago

C.D.P. Editor: Good article. Thanks.

Discussion:

Look beyond coal...... hmm..... did you vote for Obama? Look beyond coal.......hmm......make hunting season year round? Boom/Bust...... hmm.... retirees are pretty frugal.... home prices are still pretty high here compared to what you could buy in Phoenix.... gas and food are pretty high here.... 40 below.... I think they're going to Phoenix or Las Vegas.

Or maybe we could fight hard against incestuous and corruptly adopted legislation like 10-1365.

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John Kinkaid 3 years, 5 months ago

Retirees........hmm.......... We'll need to bring in either a Luby's, Country Buffet or a Golden Corral.

Might have better luck with an oil refinery.

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als362 3 years, 5 months ago

I think that many things cost more here than in Phoenix is because people here generally make more money here than in Phoenix. I doubt there are very many people in Phoenix that earn $30.00+ per hour or over $100,000.00 per year. I would rather see a Lowes come here rather than another restaurant, I believe it would benefit more people.

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Taxpayer 3 years, 5 months ago

According to government data, the median salary for jobs in Craig, Colorado is $29,922, and the median income of households in Craig was $41,091. Median Hourly: $38.17. . median income of $92,090 .for Phoenix Arizona..

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justthefacts 3 years, 5 months ago

Fact: The vast majority of Moffat County residents do not work 4 days a week, and make $100,000.00 per year as Als and other people at the power plant do.

Fact: Moffat County is very fortinuate to have many good jobs with the mines and Power plant. ( But that is not the majority of the jobs) Any government employees making that kind of money here in good ol' Moffat County???

Fact: Those industries also give the County, and the Schools the tax base to operate. ( Check who the biggest tax payers are in the county. All energy !!!!)

Fact: With out these, justateacher would be just a teaching somewhere else. ( Still not making the kind of money energy jobs do. That is sad, our teachers deserve better!!!!)

Fact: We are what we are, and that's why we eats our spinach, so we will be strong to the finish.

Fact: The finish for the Moffat County we know, ends when Coal, gas, and Oil are gone. ( Then back to one room schools in Moffat County.)

To speed up the end, just Vote for more Democrats!!!!!.

Just The energizing Facts

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