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Arch Coal to move 100 miners from lower heat mine to Black Thunder

Coal News - Published on Wed, 12 Dec 2018

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Star Tribune reported that the second largest thermal coal producer in the US is moving about 100 miners from its Coal Creek mine in northern Wyoming to its higher-production Black Thunder mine outside Wright. The move will cut the majority of the 154-miner workforce at Coal Creek. Since a downturn in the nation’s coal industry that hit bottom in 2015 and 2016, producers in the Powder River Basin have had to be nimble, adjusting to fewer customers to buy their coal, as well as fewer contracts promising long-term demand. An expanding national fleet of natural gas plants has eroded coal’s dominance as the source for US electricity in recent years.

The Trump administration has made the coal industry a priority, but its various proposals to stem coal’s decline have thus far proved insufficient in the face of a changing market. A decision by the Environmental Protection Agency, announced Thursday, would lower standards for new coal-fired plants in the hopes of encouraging more investment in coal power. However, utilities have noted their strategy going forward will depend largely on new gas or new renewable power, which are far cheaper to build.

Arch’s decision to move miners is likely driven by Coal Creek’s lower heat value coal compared to Black Thunder’s resources, according to multiple independent sources in Wyoming’s coal industry.

Arch Coal did not respond to multiple requests for comment on the shift in their labor force following a short interview in mid-October.

Travis Deti of the Wyoming Mining Association declined to comment on Arch, but said that Wyoming’s coal producers are continually responding to changes in the market. Black Thunder is one of the largest open surface coal mines in the country, lying just east of the town of Wright. It employed 1,173 miners as of September.

Arch Coal took the unusual step of cutting production expectations at Black Thunder early this year by about 10 million tons. Multiple coal firms in the basin have noted in calls with investors over the past year that unloading lower-heat coal has been a challenge in coal’s new normal. Companies with multiple mines, like Cloud Peak Energy, Peabody Energy and Arch, have also shifted to a basin-wide focus of their coal assets with the ability to move production and employees according to demand.

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Posted By : Nanda Koijam on Wed, 12 Dec 2018
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