powder river basin

Stephanie Joyce

Coal companies could have to pay royalties on the sale price of exported coal if the Department of the Interior adopts new regulations next year. The draft rules released on Friday address a loophole first identified by the Reuters news service.

Leigh Paterson

Liquefied natural gas has long been used to power vehicles like buses and garbage trucks. But this week, one of America's largest coal companies, Alpha Natural Resources, announced a plan to build an LNG plant right next to a Gillette-area mine. That LNG will then be used to power the mine's massive coal haul trucks. 

Stephanie Joyce

The red smokestacks of the Comanche power plant outside of Pueblo, Colorado can be seen from miles away. The plant supplies power to communities along the Front Range, including Denver, and consumes hundreds of tons of coal an hour in the process. That coal arrives in mile-long trains from Wyoming’s Powder River Basin and is stockpiled at the plant. Normally, that pile would be a hundred feet tall, according to Xcel Energy fuel supply manager Craig Romer. But right now, it’s less than a third of that.

As oil production continues to boom in the Powder River Basin, illegal wastewater dumping is a growing problem. Kodiak Oilfield in Converse County was recently cited for illegally dumping produced water, one of 14 water violations in the state so far this year.

Oil fields typically produce about twice as much water as they do oil – water that is high in sodium content and contains hydrocarbons. Dumping this water into streams, rivers, or fields could interfere with natural habitat, soil, and water quality.

There's a new pipeline project proposed from North Dakota to Oklahoma that would run through Wyoming. On Friday, Enterprise Product Partners LLC announced an "open season" for the Bakken-to-Cushing pipeline. Open seasons are a way to gauge interest and demand for a pipeline.

If built, the line would run from the Williston Basin in North Dakota, and would pass through oil plays in Eastern Wyoming and Northern Colorado. The line would end in the Cushing hub in Oklahoma, where oil is priced.

Totororo.roro via Flickr Creative Commons

The Port of Vancouver approved plans Thursday to build a nearly $14 million-dollar terminal to ship coal from the Powder River Basin in Wyoming to Asian markets.

The decision came just days after state regulators in Oregon rejected a proposal for such a terminal amid opposition from fisherman and environmentalists.

Coal producers in the Powder River Basin have been looking to sell more coal to Asia, but these ambitions have been restricted by limited port capacity on the West Coast.

Stephanie Joyce

Wyoming’s Powder River Basin is getting renewed attention from oil and gas companies. The region has been producing oil for decades, but now companies are looking to tap some of the Basin’s old reserves using new techniques, like horizontal drilling and fracking.

As analyst Raoul LeBlanc, with IHS Energy, explained in a video blog last week, his firm thinks the Basin could have as much potential as some of the much better-known plays in North Dakota and Texas.

A 5000-well oil and gas project proposed for the Powder River Basin is drawing sharp criticism from a wildlife advocacy group.  Erik Molvar with WildEarth Guardians says the drilling would take place right in the middle of critical sage grouse habitat.

“Well, the 5000 wells are projected in an area of over a million acres to the north of Douglas, stretching all the way up in the Thunder Basin National Grassland and including several core areas that have been proposed priority habitat for sage grouse,” Molvar says.

The latest proposal for getting coal from the Powder River Basin to world markets involves a port on the west coast of Mexico. According to a report from SNL Financial, a Mexican company is in the process of securing permits for a $700 million export terminal. MEXPORT’s CEO Daniel Suarez told SNL there’s been interest from Powder River Basin coal producers, and if the company is able to raise sufficient capital, it could start exporting by 2017. The company's consultant didn't return calls for comment.

Stephanie Joyce

Millions of railcars leave the Powder River Basin every year, carrying hundreds of millions of tons of coal. Those are big numbers, but the coal we mine is just a small fraction of what’s underground. Most of the basin’s coal reserves are buried too deep for conventional mining.

An Australian company called Linc Energy wants to use a technology known as underground coal gasification to tap those deep coal reserves and turn them into fuel. But as Wyoming Public Radio’s Stephanie Joyce reports, that might come at the peril of another valuable resource: water.

Arch Coal executives expressed frustration with the nation’s two biggest railroads during a conference call with investors Tuesday. Coal shipments out of the Powder River Basin have been delayed in recent months because of congestion on the BNSF and Union Pacific main lines. Arch Coal CEO John Eaves said it’s hurting the company’s earnings.

Port facilities that would export Powder River Basin coal through the Pacific Northwest are continuing to move towards construction.

In separate decisions this week, Washington and Oregon both announced progress on permitting for coal export terminals in their respective states.

Coal dust emissions from trains could be cut following a recent ruling by the federal Surface Transportation Board. The Board ruled earlier this month that rail companies can require use of dust suppressants or ‘toppers’ on coal cars.

BNSF was one of the companies pushing for the rule. Spokeswoman Courtney Wallace says coal dust has been shown to foul the tracks and lead to accidents.

Amid a slew of disappointing quarterly financial results from Powder River Basin coal companies, some groups are raising questions about the commodity’s long-term viability.

The Boulder-based environmental group Clean Energy Action released a report Wednesday that predicts the country has already passed “peak coal” and that production will continue to decline because of rising costs. They include Powder River Basin coal in that prediction, even though it has the lowest production costs in the country.

Duncan Harris / Creative Commons

An unfolding court case might change how Powder River Basin coal is taxed in Montana. Last week, a Montana district court heard oral arguments in a lawsuit pitting Cloud Peak Energy against the state.

The state is asking for $3.4 million in back taxes, arguing that Cloud Peak underpaid between 2005 and 2007 by selling to an affiliated company at below-market value.

U.S. Geological Survey

Last week, we reported that the federal government might be selling Powder River Basin coal for less than it’s worth. As reform advocate Tom Sanzillo described the sales:

While coal producers look to international markets to make up for a soft coal market at home, experts advise that Asian coal demand will not be as strong as had been expected.

During a recent teleconference, researchers and environmentalists discussed the financial viability of building coal export terminals in the Northwest US to ship Powder River basin coal to Asia. Ross Macfarlane works for Climate Solutions, a clean-energy advocacy group. He said domestic producers didn’t account for the evolution of the coal market abroad.  

Today’s coal lease sale of nearly 150 million tons of mineable coal in the Powder River Basin received zero bids.

It’s the first time the Wyoming office of the Bureau of Land Management has received no bids for a sale. Cordero Mining, a subsidiary of Cloud Peak Energy, asked BLM to open the tract in 2006. It's adjacent to an operating Cloud Peak mine.

But Cloud Peak CEO Colin Marshall says things have changed since then. In a press release, he cited current coal market conditions and regulatory uncertainty as factors in the company's decision not to bid.

The U.S. Army Corps of Engineers, the Washington State Department of Ecology, and Whatcom County have announced that their joint Environmental Impact Statement for a proposed coal export facility in Washington State will include a broad analysis. The proposed Cherry Point terminal would be able to export 48 million tons of coal each year, mostly of Powder River Basin coal going to Asia.

The US Geological Survey will merge operations from their Wyoming and Montana Water Science Centers this fall.
 

The centers measure stream flow and quality in each state, which share two water sheds and have similar geography.
 

Wyoming-based USGS Hydrologist says currently, each team can only do monitoring up to the state line.
 

Last year, we reported on a new project to restore sage grouse habitat that’s been disturbed by energy development in the Powder River Basin. The Bureau of Land Management, the Natural Resources Conservation Service, and other agencies are participating in the effort.

The U.S. Energy Information Administration released its “Today in Energy” brief today, which details, among other things, coal exports from the U.S. According to the report, March had the highest number of coal exports yet. The top importing countries were China, the Netherlands, the UK, South Korea, and Brazil. The top five ports were all in the southern and eastern United States. Those ports exported over two and half times more coal in March alone than the Northwest ports did for all of 2012. Powder River Basin coal mostly ships from the Northwest.

A new US Geological Survey study says that only a small percentage of coal in the Powder River Basin is cost-effective to mine in the current market. According to the USGS, there are more than one trillion tons of coal present in the Basin, of which 162 billion tons could technically be recovered. Of that, it would only be economically viable to mine about 25 billion tons in today’s market.

Project Chief for the US Coal Assessment Program, Jim Luppens, says new geologic data made the study possible.

With the start of the legislative session Tuesday, lawmakers have begun to lay out ideas for state income opportunities and budget priorities. With a slow-down in energy revenue predicted for the next decade, House Speaker, Thomas Lubnau, says Wyoming should look for new opportunities abroad.

“15% of Australia’s gross domestic product, about 1 in every 5 dollars of the Australian economy, is shipping coal to Asia. And there’s a huge opportunity for Wyoming to hop into that market if we can figure out a way to get ports either on the Gulf Coast or in Washington or Oregon.”

Coal industry roundtable brings optimism to industry

Dec 17, 2012

A coal industry roundtable discussion left some people feeling more optimistic about Wyoming coal industry than they had been before. During last Thursday’s meeting – called “Powder River Basin Coal: Domestic Challenges and International Opportunities” – presenters discussed everything from new regulations, to growing exports, and domestic issues. Tim Considine of UW’s Center for Energy Economics and Public Policy helped organize the event. He says he was surprised by some of what he heard.

Coal exports going abroad increasing

Dec 7, 2012

This year’s U.S. coal shipments went up about 24% from 2011 export numbers – and that’s only as of October. Exports still make up a relatively small percentage of total production, but with domestic use going down and world-wide demand going up, coal producers in places like Wyoming are looking to foreign markets to keep sales steady. For now, though, ports capable of handling truly large coal shipments are just in the planning stages. And Center for Energy Economics and Public Policy director, Tim Considine, says foreign sales won’t solve all of the industry’s problems.

A federal district court judge in Washington, D.C. ruled against several conservation groups, who had challenged the BLM over new coal leases in the Powder River Basin.

The leases would let Cloud Peak Energy mine more than 400-million tons of coal. Shannon Anderson with the Powder River Basin Resource Council says her group opposes the plan because they feel coal companies haven’t been doing adequate reclamation of mines.

The Sierra Club and Wild Earth Guardians are suing the federal government over planned coal leases in the Powder River Basin.

The BLM has approved the sale of four new coal leases in the area, which could produce up to two billion tons of coal. The Sierra Club’s Connie Wilbert says her group worries about the greenhouse gas emissions that could result from the additional mining and subsequent use of the coal.

A new report by researchers at the University of Montana warns that unless energy development slows down, sage grouse populations in the Powder River Basin could die out. The study, which was commissioned by the BLM, was meant to determine whether the sage grouse population there can survive, given current oil and gas drilling activities, and what would happen to the birds if more drilling occurred or if there were new West Nile Virus outbreaks. Wyoming Public Radio’s Willow Belden spoke with Dave Naugle, who co-authored the report. He says the sage grouse population in the Powder River Basin has already declined by 82 percent as a result of energy development.

A new report commissioned by the BLM warns that unless energy development in the Powder River Basin slows down, sage grouse populations there could die out.

Dave Naugle of the University of Montana co-authored the report. He says the sage grouse population in the Powder River Basin has already declined by 82 percent as a result of oil and gas drilling, and he says a disease outbreak similar to recent West Nile Virus occurrences could mean that fewer than 100 males would be left. That, Naugle says, “would functionally mean that that population could go extinct. ”