There’s more bad news this week from the Southern West Virginia coalfields, with another round of layoffs apparently on the way at Patriot Coal. Here’s their press release issued yesterday:
Patriot Coal Corporation (OTC Pink: PATCA) today issued WARN Act notices at the Corridor G mining complex located near Danville, West Virginia. The Corridor G complex, which includes the Hobet 21 Mine and Beth Station preparation plant, employs 360 people and produced 2.3 million tons of thermal coal in 2013.
Pursuant to the WARN Act, the Company today gave 60-day notice of potential layoffs to all employees that could be affected.
“The combination of increasing EPA regulations, mild summer weather and low natural gas prices has resulted in thermal coal pricing at levels below operating costs at many Appalachian mines,” said Patriot President and Chief Executive Officer Bennett K. Hatfield. “Over the next two months, Corridor G management will further evaluate operations and staffing to assess their ability to produce coal at lower costs and determine the extent of actions to be taken. We deeply regret the impact these actions will have on our hard-working employees and neighboring communities.”
The announcement prompted predictable responses from what Gazette columnist Rick Wilson referred to as West Virginia’s political “ruling class“.
Here’s Rep. Nick J. Rahall’s statement:
It is my fervent hope that, in the coming weeks, as the company watches the coal market and evaluates its operations and staffing, it finds that it can ultimately keep these miners on the job. Certainly, I will keep fighting with our coal miners to push back against regulatory overreach that is impacting coal, just as I did today with passage of H.R. 5078, legislation to block EPA from expanding its regulatory jurisdiction.
And here’s Gov. Earl Ray Tomblin’s statement:
The announcement of potential layoffs at the Hobet 21 Mine and Beth Station preparation plant is more tragic news for our miners and their families. We continue to hold out hope that the end result is not as severe as today’s announcement, however we are committed to providing workforce training, continuing education opportunities and other assistance our miners and their families many need during this unfortunate time.
We recognize market trends can play a part in these potential closures; however these trends also reflect the regulatory environment in which industry must operate. We continue our fight for West Virginia’s mining jobs and urge the EPA to reconsider its proposed plan and realize the real impact their proposed CO2 rules would have on West Virginia miners, their families and our communities. As our national economy grows and more manufacturers expand operations, the use of electricity will rise as well, and West Virginia coal remains the most cost-effective, reliable source of that power.
Give Gov. Tomblin a little bit of credit for at least saying that part about “market trends.” But gosh, when you read on in his statement and see this suggestion that “as our national economy grows” coal will start to boom again … well, you wonder if anybody in state government ever bothers to read coal production forecasts like those published by the U.S. Energy Information Administration.
As we’ve written on this blog and in the Gazette over and over again, most recently in a story headlined “Win over EPA won’t save Southern W.Va. coal, experts say“:
Coal production in the state’s southern counties, and the rest of the Central Appalachian basin, has plummeted in the past 15 years. Current government forecasts project a steep decline will continue through the end of this decade before bottoming out. While tougher air-pollution rules have played a role, experts cite a variety of more important factors, with competition from cheap natural gas and a long-predicted depletion of the best and easiest-to-reach coal reserves chief among them.
Political leaders and coal industry officials can complain all they want about President Obama and the EPA, experts say, but even if they win that fight, it’s not going to stop the decline in Southern West Virginia’s coal industry.
“It just doesn’t look like coal there is going to boom in the future,” said Robert Milici, a researcher with the U.S. Geological Survey. “The best coal has been mined out. It’s pretty well gone.”
Political leaders can play the anti-EPA card all they want. But it’s misleading. And with comments like those in his statement yesterday, Gov. Tomblin gives his constituents in the southern coal counties — the friends, family and neighbors he grew up with — false hope about their future, suggesting that if somehow we can just get President Obama and EPA off our backs, the coal industry in places like McDowell County will boom again.
Some West Virginia media outlets continue to do their best to make matters worse.
Earlier this week, for example, the folks over at the Daily Mail ran a Bloomberg piece by Mario Parker across the top of their front page, with the headline “EPA rules boosting dirty coal.” It was a perfectly reasonable story, noting a trend that most folks who follow the coal industry are well aware of:
Demand for the fuel from the Illinois Basin in President Barack Obama’s home state climbed last year to the highest level since 1990 as sales of nearby Appalachian coal dipped and consumption of the product from Powder River Basin mines in Wyoming grew at a slower pace.
Illinois basin coal has greater sulfur content than the other coals, and either costs less or has a higher heat content, meaning it’s sought after by utilities forced to install scrubbers in their power plants by a succession of federal laws and Environmental Protection Agency rules. Its share of U.S. production will climb to 20 percent by 2040 from 13 percent currently, according to the Energy Information Administration.
The Daily Mail, though, followed up with an editorial headlined, “West Virginia coal can find hope in Illinois,” opining:
Some people write off coal in West Virginia every other decade. But production continues to be at or near historic highs. Be it natural gas or windmills, no single source alone can meet the nation’s energy needs.
Instead of being disheartened by the rise of Illinois coal, West Virginia’s coal industry should be encouraged.
But like Gov. Tomblin and the EIA coal production forecasts, you have to wonder if the Daily Mail’s editorial writers really read Mario Parker’s story. If they had, they would understand the direction Southern West Virginia coal is headed — no matter what EPA does about carbon dioxide:
Production from Northern Appalachia is projected to decline 1.9 percent next year from this year and Central Appalachia 14 percent, EIA data show.
Wyoming’s Powder River Basin will increase 4.4 percent, while the Eastern Interior, which includes Illinois, is forecast to jump 9.4 percent, EIA, the Energy Department’s statistical arm, said in a May 7 report.
Or look at what happens to the United Mine Workers when the union dares to accept the science on global warming. A local paper runs a commentary calling the scientific consensus a “scare” and saying the union should instead be dismissing that scare as “wholly unfounded.” It would be funny if so many West Virginia political leaders didn’t think right along those lines.
Rick Wilson got it right when he wrote in his Gazette column:
At some point, we need to move beyond the hissy fit and two minute hate. One step forward would be having some serious conversations about West Virginia’s economic future. Fortunately, that is starting to happen through efforts like What’s Next, West Virginia?, which is supported by many groups that are holding conversations all over the state about how we can strengthen our local economy.
We also need political leaders who will advocate for the kinds of policies and transitional assistance to help coal miners and communities get through this rough patch. As my friend Ted Boettner put it in a recent Gazette article, we need something like a “GI bill for displaced coal miners.”