Coal Age

JAN-FEB 2018

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10 www.coalage.com Janaury/February 2018 news continued Wyoming. Lighthouse Resources is also the corporate parent of Millennium Bulk Terminals-Longview (MBT-Longview), which is redeveloping a brownfield site for coal export on the Columbia River. The site currently receives coal for local use and is ready to receive other bulk commodities. "It's no secret that Washington state officials are philosoph- ically opposed to coal," said Everett King, president and CEO of Lighthouse Resources. "But that does not give them legal authori- ty to discriminate against this project and block foreign trade and interstate commerce." Lighthouse's complaint outlines how the defendants al- legedly violated the dormant foreign commerce clause by uni- laterally imposing an embargo on new coal exports and by discriminating against Lighthouse's efforts to transport into Washington coal that is being mined in Montana and Wyoming and other western states. The complaint also alleged that the state's actions are preempted by both the ICC Termination Act, which gives the federal government jurisdiction over the regulation of railroad operations, as well as the Ports and Waterways Safety Act (PWSA), which allows for the operation of vessels in U.S. harbors. In its complaint, Lighthouse seeks, among other things, a declaration by the court that the denial by the state is unlawful and an order directing the state to continue processing any and all current and future permit applications. If the permits were to be approved, the new export facility could help boost annual U.S. coal exports by 44 million metric tons and increase the annual value of U.S. exports by more than $2.5 billion. This, in turn, would significantly reduce the U.S. trade deficit with these nations and provide our allies and trad- ing partners with a reliable, diverse, and secure supply of energy, Lighthouse said. Additionally, the expanded port facility will add more than 1,300 construction jobs and 135 family-wage jobs in the local community and support thousands of other direct and indi- rect jobs across the coal supply chain in neighboring states and throughout the country, the company added. As stated in the complaint, Washington officials allegedly ignored their own greenhouse gas emissions report that found that sourcing coal from U.S. mines has a net reduction on glob- al greenhouse gas emissions by displacing mining performed in other parts of the world with more environmentally friendly U.S. mining conditions. "This export facility will create U.S. jobs, shrink the U.S. trade deficit, and reduce carbon emissions," said King. "Unfor- tunately, these benefits will never be realized if Washington state continues to obstruct and block approval of this energy infra- structure project." Another Hotspot Spells Trouble for Deer Run A new hotspot discovered in December in Foresight Energy's long- idled Deer Run steam coal mine in Illinois prompted the compa- ny to seek federal Mine Safety and Health Administration (MSHA) authority to permanently seal the current longwall district, imply- ing an uncertain future for a mine once seen as the company's po- tential crown jewel in the high-sulfur Illinois Basin state. The St. Louis-based company, the largest coal producer in Il- linois, was expected to receive MSHA approval in early 2018 for a mine re-entry plan highlighted by the permanent sealing propos- al. Foresight submitted the plan to MSHA on December 20. "They have another hotspot area there," said Art Rice, an offi- cial with the Illinois Office of Mines and Minerals in Benton. "The CO level went up and they had another fall." According to Rice, the latest hotspot was found in early to mid-December. "Through the existing boreholes they had, they were able to find out that they've got another hotspot over that fall area," he said. "The fall they had was in the longwall tailgate area. The pressure caused another flare-up and they've had elevated CO readings" again. Murray/Foresight spokesman Gary Broadbent declined to elaborate on the reasons for Foresight's MSHA filing. "At this time, the partnership is uncertain as to when production will resume at its Deer Run mine" is all he would say. It soon will be three years since Deer Run, also known as Hill- sboro, last produced coal on a consistent basis. MSHA ordered the mine closed on March 26, 2015, after elevated levels of carbon monoxide gas were detected, apparently caused by a hard-to-get- to fire or hotspot in a mined-out area behind the longwall. In the spring of 2016, Foresight requested and received per- mission from MSHA to temporarily seal the mine located a cou- ple of miles outside of Hillsboro in Montgomery County. Hills- boro is about 65 miles northeast of St. Louis. That was part of a lengthy effort by Foresight to extinguish the supposed blaze, in part by pumping nitrogen through surface drill holes into the mine. Over time, CO readings did, in fact, de- cline to more normal levels. Foresight, which in the interim saw Ohio-based Murray En- ergy Corp. acquire a majority of the privately-owned company, appeared to be working to reopen Deer Run but never publicly announced a planned restart date. Any planned restart presumably will be delayed even more now that another hotspot has been discovered. Deer Run produced 5.5 million tons of coal in 2014 and was in the process of ramping up even more in 2015 when it was closed. The mine operated sporadically over the next several months, turning out only 1.87 million tons in 2015. It produced no coal in both 2016 and 2017, according to MSHA. Robert Moore, Foresight chairman, president and CEO, said in the fall of 2017 that the company was placing more coal sales internationally, mainly to Europe and Asia, in response to a "lack- luster" steam coal market in the United States. Foresight sent 3.4 million tons into the export market through September and ex- pected 2017 total export volumes to exceed 5 million tons. Alpha Natural Resources Announces 2018 Sales Guidance Alpha Natural Resources (ANR Inc.) announced it is issuing sales guidance for 2018 of 13 million to 14.6 million tons, comprised of approximately 6.8 million to 7.8 million tons of metallurgical coal and 6.2 million to 6.8 million tons of thermal coal. Alpha's anticipated 2018 metallurgical coal sales consist of various grades of metallurgical coal, with the majority of these sales from Alpha's low-volatile, medium-volatile, and high-volatile A products. "We have diligently worked over the past 18 months to create a business model that will allow Alpha to thrive in any market,"

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