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Archive for Wednesday, November 16, 2005

High coal prices spark mining revival

November 16, 2005

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— It might not be the heyday of a half-century ago when Big Brutus was digging up 150 tons of coal per shovel-load near West Mineral, but mining activity in southeast Kansas is starting to pick up, thanks in part to record prices being paid for coal.

Last year, Vinita, Okla.-based Phoenix Mining Co. started digging up about 20,000 tons of coal each month from its surface mine at Garland, which is in Bourbon County between Arcadia and Fort Scott.

Company officials believe there is big potential for the coal industry in a region with a rich mining history, and some area politicians agree.

Officials in Crawford and Bourbon counties are lobbying the state's largest electric utility, Westar Energy Inc., to build its planned 800-megawatt, coal-fired plant in southeast Kansas.

Phoenix Mining spokesman Clay Hartley said such a plant, which Westar says it wants to build by 2013, would increase demand by 800,000 tons of coal a year.

"A power plant would jump start (demand)," said Sen. Jim Barone, D-Frontenac. "Until we get some reason to get going and jump-start it, it is very difficult to get it revived."

Kansas isn't the only coal-mining state that's seeing a revival of the mining industry. Phil Smith, spokesman for the United Mine Workers of America, said closed coal mines are being reopened across the country, and mines are in full operation in places like West Virginia, Kentucky, Indiana, Illinois, Colorado, Utah and Wyoming.

Last month, the average spot price for Powder River Basin coal from Wyoming was $16.22 per short ton, compared to prices of between $6 and $7 per ton a year ago at this time, according to the U.S. Department of Energy's Energy Information Administration.

One of the drawbacks to Kansas coal is its high sulfur content, which causes more pollution than the cleaner-burning Powder River Basin coal. But Barone said technology is making it easier to wash the sulfur out of the coal.

Rep. Doug Gatewood, D-Columbus, also believes that the southeast Kansas coal industry is on the verge of a revival.

"I understand the technology has improved so that this coal could be a viable source," Gatewood said. "We know it burns with more energy. It's just a question of getting it clean enough."

Empire District Electric Co. in Joplin, Mo., the only customer for Phoenix coal, mixes between 150,000 and 200,000 tons of local coal per year with 1 million tons of the cleaner-burning Western coal.

"It's all relative to the price of coal whether you can mine it economically or not," Hartley said. "It's all price-driven. As the price of coal goes up, we'll mine more coal."

He said another area that shows potential for Kansas coal is in a process called coal gasification.

"Coal gasification plants can burn high-sulfur coal and have no emissions," he said.

Gasification breaks coal down into its chemical components, and when carbon molecules break apart, the chemical reactions produce hydrogen and other gases that can power turbines.

"It's definitely a possible future market," Smith said. "There's a lot of research going into that and a lot of first-generation plants. States are vying for them. It is part of the new technology."

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