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And so it begins: Coal layoffs sign of things to come?

Monday, February 6, 2012

If you don’t read the Saturday newspaper, you might have missed this story, outlining two troublesome announcements last week by major coal producers here in West Virginia:

Alpha Natural Resources announced late Friday that it plans to idle several Appalachian coal mines and reduce work schedules at others, citing reduced coal demand as more electricity utilities move toward using natural gas.

The company said many of the affected workers would be able to transfer to other Alpha operations but that about 320 workers would be displaced “within the next few weeks.”

The announcement is the second such move by a major coal producer this week, coming just one day after Patriot Coal said it was closing its Big Mountain complex in Boone County.

You can read for yourselves the announcement from Alpha here and the one earlier in the week from Patriot here. Alpha made a separate announcement of its moves, in anticipation of the release of its quarterly earnings data on Feb. 24. Patriot wrapped word of its closure of the Big Mountain Complex in Boone County inside its quarterly earnings statement.

For those who missed the details of the Alpha closures and schedule cutbacks — Alpha didn’t bother to include that in its press release — here’s the way company spokesman Ted Pile explained it in an email to me:

West Virginia:

– #2 Gas mine in Kanawha County is being idled immediately as is the Randolph Mine in Boone County. Both are underground.

–The Black Castle surface mine in Boone County is reducing its work hours

–Camp Branch surface mine in Logan County is reducing work schedules

–Progress/Twilight surface mine is cutting back work schedules (Boone Cty.)

–Alloy Powellton mine in Fayette County s eliminating one underground section

Kentucky:

– the Cave Spur and Perkins Branch underground mines are idled immediately. Both are in Harlan County.

– the Coalgood surface mine in Harlan County will be phased out by the middle of this year and the Big Branch West surface mine in Knott County will close in early 2013.

Posted in Business, Labor, Peak coal | 22 Comments »

Update: Declines projected for Appalachian coal

Monday, January 23, 2012

Here’s the latest from the U.S. Department of Energy’s Energy Information Administration, in a preview of its 2012 Energy Outlook issued this morning:

Over the next 25 years, the projected coal share of overall electricity generation falls to 39 percent, well below the 49-percent share seen as recently as 2007, because of slow growth in electricity demand, continued competition from natural gas and renewable plants, and the need to comply with new environmental regulations.

The average minemouth price of coal increases by 1.4 percent per year in the AEO2012 Reference case, from $1.76 per million Btu in 2010 to $2.51 per million Btu in 2035 (2010 dollars). The upward trend of coal prices primarily reflects an expectation that cost savings from technological improvements in coal mining will be outweighed by increases in production costs associated with moving into reserves that are more costly to mine. The coal price outlook in the AEO2012 Reference case represents a change from the AEO2011 Reference case, where coal prices were essentially flat.

Although coal remains the leading fuel for U.S. electricity generation, its share of total generation is lower in the AEO2012 Reference case than was projected in the AEO2011 Reference case. As a consequence, while still growing in most projection years after 2015, total coal production is lower in the AEO2012 Reference case than in the AEO2011 Reference case, with the gap between the two outlooks increasing substantially over the period from 2020 to 2035.
In the AEO2012 Reference case, domestic coal production increases at an average rate of 0.3 percent per year, from 22.1 quadrillion Btu (1,084 million short tons) in 2010 to 23.5 quadrillion Btu (1,188 million short tons) in 2035. Mines in the West account for nearly all the projected increase in overall production, although even Western coal production is expected to decline somewhat between 2010 and 2015 as low natural gas prices and the retirement of a sizable amount of coal-fired generating capacity leads to a decline in overall coal consumption in the electricity sector. On a Btu basis, the share of domestic coal production originating from mines in the West increases from 47 percent in 2010 to 56 percent in 2035, and the Appalachian share declines from 39 percent to 29 percent during the same period, with most of the decline occurring by 2020. In the Interior region, coal production remains relatively stable over the projection period, with production in 2035 higher than in 2010.

Posted in Business, Coal business, Peak coal | 3 Comments »

UMWA reaches deal with Alpha on Massey plants

Thursday, December 15, 2011

This just in:

The United Mine Workers of America (UMWA) announced today that it has reached collective bargaining agreements with Alpha Natural Resources covering five Central Appalachia coal preparation plants which had previously been owned by Massey Energy. Workers at the plants had been working under the provisions of a previous contract that expired in 1998.

“This is a very good day for these workers and their families,” UMWA International President Cecil E. Roberts said. “They will get a substantial initial raise, the first they’ve had since 1998. They will get annual wage increases for the life of the agreement. They will get a $1,000 bonus. They will get shift differentials, a clothing allowance, sickness and accident benefits and the best quality health care benefits.

“I commend the workers at these plants for persevering so long and sticking with the UMWA in the face of constant attacks by the previous ownership,” Roberts said. “Massey simply refused to take any steps to reach a fair agreement as long as these workers stayed in the UMWA. But the workers stayed united and it ultimately paid off for them.

“I also want to recognize the fresh approach Alpha is taking with respect to recognizing the value of these employees,” Roberts said. “The UMWA is working to build a good relationship with Alpha at these and other operations where we represent the workers. We appreciate the company’s willingness to recognize and address the long-standing inequities the workers at these preparation plants were dealing with.”

The agreement covers some 145 workers at the following locations: the Bandmill preparation plant in Logan County, W. Va.; the Long Fork preparation plant in Pike County, Ky.; the Goals preparation plant in Raleigh County, W. Va.; the Chesterfield preparation plant operated by Alpha subsidiary Omar Coal Co. in Boone County, W. Va.; and the Power Mountain preparation plant in Nicholas County, W. Va.

The 5-1/2-year agreement goes into effect Jan. 1, 2012, and will continue until June 30, 2017.

Posted in Business, Labor | 5 Comments »

Blankenship back in the coal business?

Tuesday, December 6, 2011

ABC News has this interesting report tonight:

There are new indications that Blankenship may be attempting a return to the industry that helped him build a massive personal fortune, but also tarnished his image as the man at the helm during the deadliest American mining disaster in decades …

… Kentucky state incorporation records show that scarcely a month after Blankenship agreed to step down as CEO of Massey Energy, he signed papers identifying him as the president of a newly-named company, McCoy Coal Group Inc. McCoy is the family name of Blankenship’s mother.

The status of McCoy Coal and Blankenship’s role with the firm remain unclear — calls to the company’s lawyer and to Blankenship’s attorney have not been returned.

The corporate records in question are online here.

Posted in Business, Media coverage, Upper Big Branch Disaster | No Comments »

Mining lobby admits it: Coal jobs are on the rise

Friday, November 18, 2011

We’re about to be treated to another episode in the continuing story of the attacks by the coal industry and its friends in Congress on any effort by the Obama administration to reduce mountaintop removal’s impacts on coalfield communities, protect the world from greenhouse gas pollution and ensure mining industry workers make it home to their families after each workday.

That’s right the House Natural Resources Committee is set to hold a hearing later this morning on what Ohio Republican Bill Johnson’s bill called the “Coal Miner Employment and Domestic Energy Infrastructure Protection Act”. Basically, this is a bill to stop the federal Office of Surface Mining Reclamation and Enforcement from rewriting the federal stream buffer zone rule, but it’s actually much broader, prohibiting OSMRE from taking any actions that would do any of the following:

– Adversely impact employment in coal mines in the United States;

– Cause a reduction in revenue received by the Federal Government or any State, tribal or local government, by reducing through regulation the amount of coal in the United States that is available for mining;

– Reduce the amount of coal available for domestic consumption or export;

– Designate any area as unsuitable for surface coal mining and reclamation operations; or

– Expose the United States to liability for taking the value of privately owned coal through regulation.

Now, to hear Rep. Johnson talk, there’s a major crisis in the nation’s coalfields, with workers and their families already suffering because of actions by the Obama administration’s Environmental Protection Agency:

Every day thousands of hardworking coal miners go to work to put food on their families’ tables and keep millions of American families supplied with reliable, low cost electricity. The Obama Administration has actively sought ways to put an end to the coal industry through onerous regulations and activist rulemaking. This bill will ensure that this Administration cannot continue its efforts to increase the cost of energy for millions of Americans and put thousands of coal miners and coal industry related workers out of work.

The federal government should not be in the business of blocking production of one of America’s most abundant natural resources and the source of livelihoods in communities across the country.

And not so long again, in celebrating a partial court victory over EPA, the National Mining Association’s president, Hal Quinn, said this:

With this decision, coal communities can get back to the business of producing affordable energy for Americans and put more Americans back to work.

So imagine my surprise to see the chart I’ve posted above right there at the top of the National Mining Association’s website, along with this fascinating bit of text:

Mining added 11,000 men and women to our payrolls over the last year, along with 17,000 new support jobs. In fact, U.S. mining added thousands more jobs over the last decade-America’s first job-loss decade in 75 years.

Jobs at U.S. metals mines climbed by 10 percent and coal mining employment rose by 8.5 percent since 2001 . . . mining support jobs grew by an astounding 32 percent.

Here are their specific numbers:

Of course Matt Wasson at Appalachian Voices has been trying to make the point that government data indicates that coal-mining jobs in West Virginia specifically are on the rise since EPA began its crackdown on mountaintop removal — and lawmakers should know this, since Joe Lovett of the group Appalachian Mountain Advocates made this very point during a previous hearing:

Since 2007, as production in Central Appalachia has shifted away from mountaintop removal and back toward underground mining, the increase in employment at underground mines has more than offset declines at other types of mines. Although mountaintop removal may benefit the bottom lines of big coal operators, it does not increase the number of coal mining jobs.

Since mountaintop removal permits have been slowed by litigation and EPA regulation, mining jobs have actually increased in the region.

Posted in Business, Mountaintop Removal | 23 Comments »

Coal stockpiles at five-year low

Wednesday, November 9, 2011

In case anyone missed it, Friday’s “Today in Energy” item from the Department of Energy’s Energy Information Administration reported:

Total coal stockpile levels at U.S. electric power plants were 139 million tons in August 2011—the lowest total level for August since 2006. Bituminous coal stockpiles declined the most, down 27% since August 2009. Increases in the spot price of Central Appalachian coal as well as some supply disruptions in the late spring of 2011 contributed to declining stock levels.

Coal stockpile levels typically decline during summer months as power plants burn through stocks to meet seasonal peak electric demand for air conditioning load. Stockpile levels have been depressed throughout 2011 compared to 2009 and 2010 levels. According to average monthly data, the spot price of Central Appalachian coal (a key benchmark for the price of Eastern bituminous coal) was up 18% since August 2010. Flooding in April and May disrupted some coal deliveries, especially in the Southeast, and likely played a role in the declining stock levels going into the summer of 2011.

Posted in Business | 2 Comments »

DOE: Six ports account for bulk of U.S. coal exports

Tuesday, November 8, 2011

Interesting post today from the Department of Energy’s “Energy Today” site:

Seaports in the Gulf Coast and East Coast account for most U.S. coal exports. Six seaports accounted for 94% of U.S. coal exports in 2010, up from 63% in 2000. Over 68% of total U.S. coal exports in 2010 were coking coal, which is used in making iron and steel. Steam coal, used to generate electricity, comprised the remaining 32% of exports.

Despite falling Midwest exports, overall U.S. coal exports have been resurgent, reaching nearly 71 million tons in the first eight months of 2011—the highest level in decades—driven by high global demand and significant weather disruptions of Australian coal exports. Combined annual exports from Norfolk, Virginia and Baltimore, Maryland increased 18 million tons from 2000 to 2010. For the first eight months of 2011, New Orleans, Louisiana coal exports grew 980% above the 2000 level and surpassed the record 2010 level by nearly 50% despite flooding along the Mississippi River disrupting barge traffic. Coal exports from Seattle, Washington have also risen sharply in recent years as significant coal production in the Powder River Basin seeks access to growing Asian coal markets.

Posted in Business | 1 Comment »

Alpha update: Massey operations slow to improve

Thursday, November 3, 2011

Alpha Natural Resources officials just wrapped up a conference call discussing their first earnings report containing a full quarter of results following the takeover of Massey Energy. Here are a few highlights:

– So far, Alpha hasn’t been able to achieve any major reductions in overall safety violations at former Massey operations, though officials said that the number of more serious “D orders” has dropped since Alpha acquired the properties in June.

“That’s going to take some time,” said Alpha CEO Kevin Crutchfield. “You can’t turn this thing on a dime.”

– While the coal industry continues to complain about EPA’s crackdown on mountaintop removal permits, Alpha officials say they’re in good shape with permits to run through 2012.

“We fell pretty good about what we have permitted so far,” Crutchfield said. “There’s nothing in 2012 that is contingent upon any sort of regulatory relaxation or need.”

(Those comments are especially interesting, given the ongoing litigation over the Highland Reylas permit that Alpha inherited from Massey)

– The push for more natural gas drilling — by the industry and by the Obama administration — is going to put a ceiling on coal prices, especially in the east, Alpha believes.

“Clearly, the current administration through their regulatory approach is focused on picking winners and losers, and they certainly don’t want coal to win,” Crutchfield said.

– Alpha is continuing to evaluate the former Massey properties, and to make decisions regarding which — if any — it might put on the market because they don’t fit with Alpha’s priorities.

Posted in Business | 4 Comments »

Alpha says ‘integration’ of Massey ‘right on track’

Thursday, November 3, 2011

In the wake of a speech yesterday in which U.S. Rep. George Miller questioned the commitment of Alpha Natural Resources to ending Massey Energy’s questionable safety practices, Alpha officials are saying this morning that their integration of Massey operations into Alpha is going well. Alpha CEO Kevin Crutchfield explained it this way:

We have completed ‘Running Right’ training for the entire hourly workforce at all legacy Massey operations, and we have begun a training program directed at supervisory personnel. The benefits are already becoming clear: incident rates at the legacy Massey operations are declining; employee feedback is overwhelmingly positive; and the annualized voluntary turnover rate for legacy Massey declined to single digits in the month of September, down from more than 20 percent earlier in the year. At Alpha, we understand that having an empowered workforce working together within the ‘Running Right’ culture is inextricably linked to our ability to operate safely, maintain strong employee morale, minimize turnover, and thereby deliver operational excellence.

The integration of the legacy Massey operations remains on track, and over time we anticipate continued improvement in safety performance, enhanced productivity and meaningful synergies from fostering a unified ‘Running Right’ culture throughout our organization, all of which will drive value and accrue to the benefit of Alpha’s shareholders.

That’s from the first Alpha quarterly earnings statement to include a full quarter of operations since the takeover of Massey was finalized in June. You can read the full press release here, and Alpha is scheduled to discuss the results during a conference call later this morning.

Among the results:

– Alpha Natural Resources, Inc. (NYSE: ANR), a leading U.S. coal producer, reported third quarter net income of $66.4 million or $0.29 per diluted share compared to net income of $31.9 million or $0.27 per diluted share for the third quarter last year. Income from continuing operations for the third quarter was $66.4 million or $0.29 per diluted share compared to income from continuing operations of $32.4 million or $0.27 per diluted share for the third quarter of 2010. Excluding certain merger-related and other unusual items described in our “Reconciliation of Adjusted Income from Continuing Operations to Income from Continuing Operations,” third quarter 2011 adjusted income from continuing operations was $79.9 million or $0.35 per diluted share.

– Total revenues were $2.3 billion compared to $1.0 billion for Alpha stand-alone in the third quarter of 2010, and coal revenues were $2.0 billion compared to $0.9 billion for Alpha stand-alone in the third quarter last year. Coal revenues were significantly higher than the year-ago period due primarily to the inclusion of the first full quarter of shipments from legacy Massey operations, which contributed $805.4 million of coal revenues for the quarter, combined with a 38 percent increase in average per ton realizations on metallurgical coal compared with Alpha stand-alone in the third quarter of 2010. Freight and handling revenues and other revenues were $213.8 million and $93.0 million, respectively, during the third quarter versus $85.3 million and $19.9 million, respectively, for Alpha stand-alone in the third quarter of 2010.

– Total costs and expenses during the third quarter of 2011 were $2.2 billion compared to $952 million for Alpha stand-alone in the third quarter of 2010. Cost of coal sales in the third quarter was $1.7 billion, which included $770 million from legacy Massey operations. Adjusted cost of coal sales in the East averaged $75.81 per ton compared with $63.04 for Alpha stand-alone in the third quarter last year. The 2011 per ton cost of coal sales in the East has been adjusted to exclude UBB charges of $10.6 million and closed-mine asset retirement obligation charges of $37.1 million primarily related to changes in estimated future costs of water treatment, as well as merger-related expenses of $62.6 million, including a $39.7 million non-cash charge from selling acquired coal inventories written up to fair value in acquisition accounting and $22.9 million related to retention, severance and employee benefit alignment expenses. The higher cost of coal sales per ton in the East compared to the year-ago quarter is primarily the result of the following factors: reduced production and shipments from our Emerald longwall mine due to geological challenges; lower than expected thermal coal production and shipments from Central Appalachia; more metallurgical coal production; higher variable costs due to the increased volumes and higher per ton realizations on metallurgical coal shipments; increased per ton cost of purchased coal; higher diesel fuel costs; and general inflationary pressures.

Posted in Business | No Comments »

Wake up call: More media starting to catch on to impending collapse of region’s coal industry

Thursday, October 13, 2011

There it is this morning, right at the top of the front page of the Daily Mail:

Coal industry, state may see decline.

George Hohmann wrote the story:

The coal industry has been a major force in keeping West Virginia out of a recession but the industry’s – and state’s – fortunes may be about to change.

George noted the recent national business media reports:

“‘Collapse’ isn’t a word to be bandied about in mining circles,” The Wall Street Journal observed last week. “But how else to describe the recent precipitous drop in stocks of U.S. coal producers?”

The Journal noted that companies reporting production problems have had their stocks hammered after they disclose bad news.

From a larger perspective, the newspaper noted that the industry has become increasingly focused on producing coking coal. The Journal reported that global financial services firm Morgan Stanley has determined that while coking coal is less than 10 percent of total U.S. coal output, it accounts for about half of the sector’s earnings.

“Japan, China, India and Europe import nearly three quarters of the world’s seaborne coking coal,” The Journal said, referring to coal shipped on ocean barges. “Everything from natural disasters to monetary tightening have cut or could cut steel demand in those regions. Meanwhile, half the world’s exports of coking coal comes from Australia, where output is now recovering after last year’s floods.”

Posted in Business, Peak coal | 4 Comments »

Should W.Va. increase taxes on coal?

Tuesday, September 20, 2011

Gazette photo by Chip Ellis

Here’s something you probably won’t hear the major candidates for West Virginia governor talking much about: It seems West Virginia’s coal industry pay significantly less in severance taxes than other mineral-producing states.

That’s what the fine folks over at the West Virginia Center for Budget and Policy had to say in this new blog post:

… It’s not surprise that the top severance tax states all are rich in coal, oil, gas, or all three. Alaska tops the list, with over 66% of state tax revenue coming from severance taxes. West Virginia comes in with over 7% of state tax revenue coming from its severance tax.

Posted in Business, Corporate welfare | 12 Comments »

On eve of President Obama’s jobs speech, industry goes after Sierra Club’s ‘Beyond Coal’ campaign

Wednesday, September 7, 2011

As the nation waits to hear more details of President Obama’s new jobs plan, the National Mining Association sought today to inject its own agenda into the mix — issuing a news release criticizing the Sierra Club’s “Beyond Coal” campaign:

On the eve of the president’s address to the nation on job creation, a new report shows potentially 1.24 million jobs in 36 states have been destroyed by the Sierra Club’s “Beyond Coal” campaign aimed at stopping coal-based power plants. The finding, from an analysis released today by the National Mining Association (NMA), shows that while the Sierra Club boasts of stopping coal plant projects it is also destroying high-wage jobs for American workers in a struggling economy.

Aside from its news release, the NMA made public just two charts (see here and here) from the analysis, but said:

Applying coal plant employment data from the U.S. National Energy Technology Laboratory (NETL) to the Sierra Club’s own claims of halted power plant construction, the analysis shows Sierra Club’s “Beyond Coal” campaign has targeted for destruction 116,872 permanent jobs and an additional 1.12 million construction jobs represented by the power plants they have prevented from being built. Examples include Illinois, where proposed power plants could have supported 126,612 total jobs there and in surrounding states, and Texas, where blocked power plant construction represented 122,065 total jobs and where potential shortages of electric power exists today.

Posted in Air pollution, Business, Green jobs | 42 Comments »

CONSOL sells half of its Utica Shale acreage

Wednesday, September 7, 2011

On the heels of its sale of Marcellus Shale natural gas reserves, CONSOL Energy said today it would also be divesting itself of half of its Utica Shale acreage in Ohio. According to a news release:

CONSOL Energy Inc. (NYSE: CNX) announced today that it has entered into an agreement with Hess Corporation (NYSE: HES) for the joint exploration and development of CONSOL’s nearly 200,000 Utica Shale acres in Ohio for aggregate consideration to CONSOL of approximately $593 million.

J. Brett Harvey, CONSOL’s CEO, said:

We are very pleased to have Hess Corporation as our partner in the Utica Shale. Hess Corporation is a global integrated energy company that shares CONSOL’s dedication to safety and compliance, and they bring strong technical and operational shale expertise to this joint venture. Those skill sets coupled with CONSOL’s deep footprint and history in northern Appalachia result in a powerful combination that will benefit the eastern Ohio economy, strengthen the communities in which we operate, and provide more opportunity for our employees, and our respective companies. Together we will explore and delineate what could be a significant resource in a safe, efficient, and economical manner.

Posted in Business | No Comments »

Alpha CEO: Coal ‘the goose that laid the golden egg’

Thursday, September 1, 2011

Alpha Natural Resources CEO Kevin Crutchfield gave a major speech yesterday at the West Virginia Chamber of Commerce’s meeting over at The Greenbrier. The Beckley paper reported:

“It’s not easy times to be in the coal business. I mean, as most of you know, adding to the normal business challenges we face on a global basis, coal is under attack — a direct, frontal assault by opponents who think that we’d be better off without coal,” Crutchfield said. “It’s almost as if they want to kill the goose that laid the golden egg when, in reality, coal is one of the major contributors to what made America and this state the great places that they are today.”

From the media coverage (West Virginia Metro News also had a piece), there was a lot of unsurprising jingoism, talk about how coal is a vital part of our nation’s future:

Crutchfield said without a doubt, coal will be as much a part of the nation’s future as it was of its past.

“Coal will continue to fortify our structures and electrify nations for years to come,” he said.

There are several reasons, Crutchfield said, that coal will continue to dominate energy markets, but most obviously, is its price tag.

“Because it’s reliable, it’s abundant and it tends to cost less,” Crutchfield said. “In many cases, much less.”

There was no mention, as best I could tell, of what happens over the next decade, as coal production from Central Appalachian enters a major, major decline.

Posted in Business | 10 Comments »

Alpha/Massey seeks to end shareholder suit

Tuesday, August 23, 2011

It’s been a while since we heard anything about the shareholder derivative suits pending against Massey Energy and the former top executive and board members from Massey.

But today, Kanawha Circuit Judge Charlie King held a hearing, to give lawyers for Alpha Natural Resources and those former Massey management personnel and board members a chance to argue that at least one of those cases should be tossed out of court.

Basically, lawyers for the company and the board members argued that when Alpha and Massey merged back on June 1, the plaintiffs in this case lost their right to bring the suit.

Lawyer for the plaintiffs (shareholder groups of the former Massey Energy) allege that their case falls within an exception, for situations where a merger was aimed at escaping liability. Plaintiffs have previously offered a variety of evidence (see here, here and here) they say supports the nation that Massey officials moved toward the Alpha deal to help them avoid any personal liability for the Upper Big Branch Mine Disaster.

One tricky thing here is that some of those claims by the plaintiff were made in a proposed second amendment to their original complaint. Judge King hasn’t yet given approval for that amended complaint to be officially filed. And the previously approved complaint doesn’t contain these specific allegations about the merger because, well, the merger hadn’t happened when it was written and submitted to the court.

Judge King did not rule this morning, and gave both sides a couple of weeks to submit proposed orders outlining what they would like the judge to do. So stay tuned …

Posted in Business, Legal actions, Upper Big Branch Disaster | No Comments »

About the jobs: Is there a war on coal?

Monday, August 22, 2011

The Daily Mail’s Jared Hunt had an interesting story this morning. Headlined, “State jobs data less than positive,” the story explained that despite a drop in unemployment, the number of West Virginians working or looking for work has dropped to its lowest level since 1993.

If you read further down into the story, you get to this part:

But the president of the state Chamber of Commerce says that the state’s dwindling workforce should be a sign to lawmakers that it’s time to get serious about fostering economic growth in the state.

“We simply can’t continue doing all the things we’ve been doing and rest on our laurels,” said Chamber president Steve Roberts. “We’re hard as hell on manufacturing, so we keep losing manufacturing employment. We have a national policy that is very anti-coal, and we’re holding our breath that Marcellus shale may help us in the future, but right now we don’t know for sure.”

He said it’s time that the state Legislature — particularly the House of Delegates — got around to adopting policies to counter the state’s traditionally low rankings in business friendliness.

The Daily Mail pitched this as a story that dug deeper into the numbers than state officials wanted the public to see … But unfortunately, the story didn’t do much digging into Steve Roberts’ remarks.

And doing so wouldn’t have required looking very far … Take Friday’s installment of the West Virginia Center on Budget and Policy’s blog, headlined “The War on Coal“? In it, Sean O’Leary writes:

If you’ve read a newspaper, visited an airport, or driven on the highway lately, you’ve probably noticed a billboard or advertisement or two blaming the EPA for destroying coal jobs or creating a no job zone through environmental regulations. The supposed effects of the “war on coal” are not limited to Appalachia either, as U.S. representative Mike Simpson of Idaho recently claimed that, ” … the overregulation from EPA is at the heart of our stalled economy.”

But if EPA regulations are creating a “no job zone” in Appalachia and stalling economic growth, then one would expect to find some serious declines in mining employment. But that isn’t the case. In fact, according to the BLS numbers, in the past 12 months, the mining sector has seen the largest increase in employment in West Virginia.

Posted in Business, Media coverage | 18 Comments »

Alpha reports $56.4 million quarterly loss

Thursday, August 4, 2011

This just in from Alpha Natural Resources:

Alpha Natural Resources, Inc. (NYSE: ANR), a leading U.S. coal producer, reported a second quarter loss of $56.4 million or $0.36 per diluted share, including the impact of $254.4 million of pre-tax merger-related expenses, which included a $108.3 million non-cash charge from selling acquired coal inventories written up to fair value in acquisition accounting, arising from the acquisition of Massey Energy Company (Massey) on June 1, 2011, compared to net income of $38.8 million or $0.32 per diluted share last year. The second quarter 2011 loss from continuing operations was $56.4 million or $0.36 per diluted share compared to income from continuing operations of $39.2 million or $0.32 per diluted share in the second quarter of 2010. Excluding merger-related expenses, Upper Big Branch (UBB) charges for costs of the accident investigation and site maintenance, amortization of acquired intangibles, loss on early extinguishment of debt, income tax impacts of the foregoing items and a discrete income tax charge, second quarter 2011 adjusted income from continuing operations was $150.6 million or $0.96 per diluted share.

Check out their entire earnings statement here, and you can listen to their quarterly conference call with industry stock analysts this morning at 10 by going to this link.

Posted in Business | 1 Comment »

If coal is so good, then why is W.Va. so poor?

Friday, July 22, 2011

A coal truck drives out of downtown Welch, W.Va., Wednesday, Feb. 9, 2011. (AP Photo/Jon C. Hancock)

As we wrap up another week of news from the coalfields of West Virginia, it’s worth looking back to see exactly who is asking the tough questions that need to be asked about this industry and its impacts on our state.

First, it takes a couple of members of Congress from California of all places to press Kevin Crutchfield, CEO of Alpha Natural Resources, about exactly how opposing unions fits into his company’s notion of “Running Right.”

West Virginia’s elected officials don’t seem to be interested in finding out what Crutchfield is doing to reform the Massey Energy safety practices that brought us the Upper Big Branch Mine Disaster. Contrast the grilling of Crutchfield by Reps. George Miller and Lynn Woolsey to the attitude of Rep. Nick Rahall, who this week touted “the new ownership in Southern West Virginia” as the answer to any coal-related problems. Of course, my good friend Congressman Rahall, despite spending more than 30 years in Washington, hasn’t been able to figure out what agency should look into the recent scientific study that found his constituents who live near mountaintop removal mines face a greater risk of birth defects.

Then, we had a Boston native, billionaire business information mogul (and mayor New York City) coughing up $50 million of his personal wealth to help the Sierra Club fight construction of new coal-fired power plants, encourage the closure of polluting older plants and halt new mountaintop removal mining permits.

That move by Michael Bloomberg really touched a nerve with the powers that be in West Virginia’s coal industry and among some of its political allies.

The United Mine Workers issued a statement blasting Bloomberg. So did the National Mining Association. I couldn’t imagine that Sen. Joe Manchin was going to let it slide, and he didn’t disappoint, issuing a press release saying:

Coal not only built this country, but it built the skyscrapers of New York City, and without coal, the lights of that city would be dark and its economy would be devastated.

My buddy Matt Ballard at the Charleston Area Alliance (a local business booster group) must have gotten the memo on this, because I noticed him tweeting about it:

1/2 Really would have liked 2 have seen #Bloomberg donate $ to build CO2 technology to help make coal cleaner & advance the industry.

2/2 tech advances environmental science to help reduce #CO2. But instead he chose to not think about our domestic security. #Bloomberg

That was a general theme from the UMWA, the NMA and Sen. Manchin … that Mayor Bloomberg should have used his money to support development of “clean coal” technology such as carbon capture and storage, or CCS.

OK, now let’s be clear again on something: American Electric Power dropped its work on one of the largest CCS test projects in history over in Mason County at its Mountaineer Plant. Why? Because federal and state officials have failed to make such technology necessary, by not passing any sort of binding limits on greenhouse gas emissions from power plants.

Posted in Alternative energy, Business, Climate policy, Green jobs, Health, Mountaintop Removal | 25 Comments »

West Virginia’s boom-and-bust energy economy

Thursday, July 21, 2011

Just in time to aid in the discussion of whether the Obama administration’s new guidance to limit mountaintop removal is a “job destroyer” — as the National Mining Association claims — the fine folks at the West Virginia Center for Budget & Policy have issued a report called “Booms and Busts: The Impact of West Virginia’s Energy Economy.“

The report concludes:

In the past, West Virginia counties with a concentration in mining saw their economic performance dramatically decline after an energy development boom. Today, their economies are weaker than the rest of the state, and they are ill-positioned to compete and grow. It is uncertain whether today’s energy boom, led by natural gas extraction, will bring the prosperity to West Virginia that it promises. While the potential revenues from this boom seem to be an attractive source of economic growth for communities, history shows that natural resource booms inevitably lead to busts.

Among other things, the report points out:

During the energy development boom in the 1970s, West Virginia counties that focused heavily on mining enjoyed an economic surge. However, when the boom went bust in the 1980s, these mining counties were hit hard. They did worse than the state average on a range of factors, such as earnings and personal income growth, population growth, and employment. Today, these counties have higher poverty rates, lower median incomes, and worse health outcomes than the state average. Despite the rebounds in the energy sector in the 2000s, mining counties continue to struggle in comparison with the rest of West Virginia.

And:

… A boom in energy development, be it in coal mining or natural gas extraction, does not guarantee long-term economic growth and prosperity. Although communities can rely on energy development for economic growth in the short-term, the boom is unsustainable. If trends hold, the boom ultimately leads to a bust, followed by decades of underperformance.

Check it out here.

Posted in Business, Green jobs | 1 Comment »

Rep. Miller presses Kevin Crutchfield for details about Alpha’s safety practices and policies

Wednesday, July 20, 2011

Rep. Nick J. Rahall, D-W.Va., was just assuring me yesterday that the “new ownership” in Southern West Virginia was going to change things about the way the coal industry operates.

Perhaps Rep. Rahall should talk to his colleague, Rep. George Miller — the ranking Democrat on the House committee that oversees mine safety and other labor issues — about this, because Rep. Miller doesn’t seem too convinced.

Readers may recall that back in late May, Miller and Rep. Lynn Woolsey, D-Calif., wrote to Alpha Natural Resources CEO Kevin Crutchfield, to question whether Alpha was going to rid itself of Massey’s safety culture once it acquired the rival company.

Crutchfield apparently responded with this letter, which assured Miller and Woolsey that Alpha’s “Running Right” program or philosophy or whatever exactly it is was the path to improving those Massey operations, to assuring not only the safety of miners, but protection of the environment. Crutchfield wrote:

While Running Right had its origins in safety, it is now the platform for how Alpha conducts all of its business activities, including environmental stewardship and continuous improvement, and generally how Alpha expects employees to treat each other and the communities where our affiliates operate. That is why Running Right training is provided to all employees throughout the company and not just employees involved in operations. Only in this way can Alpha create the culture that will lead to true improvement in all aspects of its business.

And now, Miller and Woolsey have responded, with a long list of questions for Crutchfield — primarily about whether Alpha has looked into the new findings of the U.S. Mine Safety and Health Administration’s investigation of the Upper Big Branch Mine Disaster. (more…)

Posted in Business, Labor, Mine Safety | 3 Comments »