Trump’s Lump of Coal
Terry H. Schwadron
Thanks to elimination of dozens of environmental rules, a new coal mine opened in Pennsylvania over the weekend, fulfilling a Trump pledge to expand jobs in mining.
Corsa Coal Company in Somerset County, outside Pittsburgh, is the first new mine in quite a while.
Okay, so what are all of the President’s men accomplishing for job creation, America First and clean air?
Its CEO, George Dethlefsen, praised the easing of regulations and government support for fossil fuel exploration. All told, it will add 70 good-paying jobs, for which 400 applied. Corsa Coal said it hopes there eventually will be 500 “indirect” jobs created in trucking, engineering, and support industries, including restaurants.
As described previously, there are about 100 times as many people now employed by biofuel and synthetic, non-fossil fuel jobs as in coal.
The opening of the mine brought an appearance by Gov. Tom Wolf, a Democrat, phoned-in encouragement from the President and a local protest from homeowners in the area who are upset about environmental effects of starting a business based on coal dust. Earlier last week, the President said in Cincinnati, ““Next week we’re opening a big coal mine. You know about that. One in Pennsylvania. It’s actually a new mine. That hadn’t happened in a long time, folks. But we’re putting the people and we’re putting the miners back to work.”
So, was everyone wrong about coal futures?
Importantly, this mine will produce 400,000 tons of metallurgical coal a year, used in the making of steel, not coal used for energy, which the President keeps repeating.
The mine envisons an international market for this type of coal that is “cooked” to produce coke before mixing with iron ore to form steel. The biggest worldwide client is China.
In general, just as with coal for energy, less coke is produced today than 50 years ago because the iron and steel industry produces less.
Corsa Coal sees more such mines opening. Last week, Alpha Natural Resources of Kingsport, Tennessee, which went bankrupt last year, said it would also open a coke-producing mine in West Virginia later this summer with 50 jobs. Last year, Ramaco Development announced plans for two new mines in West Virginia and Virginia. In Alabama, Warrior Met Coal is opening a mine formerly owned by bankrupt Walter Energy.
Background: According to the federal Department of Energy, technology changes also have reduced the use of traditional coke for use of pulverized coal injection instead. That allows steel companies to use 40 percent less coke, and making it possible to use more abundant lower grades of coal. At the beginning of 1994, 31 coke plants were in operation, less than half the number a decade earlier, the government says. Declines in the industry and higher environmental protection costs have been cited as reasons. Indiana and Pennsylvania remain the leading coke-producing states. The United States is home to about a quarter all of the world’s coal resources.
Since everything these days seems to be more about politics and appearance than the substance, this coal mine opening may be taking on outsized importance. The President is using these openings to say Coal is Back, that Hillary Clinton, who said coal was dying as an industry, was wrong, and that eliminating environmental rules and a good business environment will create jobs.
Indeed, withdrawal from the Paris Climate Agreement was based somewhat on the promise of more coal jobs — and more coal energy.
Mr. Trump is not entirely wrong, but the context matters. These coal mines with their specialized industrial coal for coke has a sliver of market that started early this year to build again because of failures elsewhere, namely in Australia. The market for the kind of coal used in electricity — the biggest use for coal — remains down relative to where it was several years ago. Even with these new jobs, following years of layoffs and closures because of competition from cheaper natural gas, are not going to change that trend.
Mr. Trump also has advocated the coal industry’s development of “clean coal” technologies as a reason to promote that industry, and argues that the Paris accords presents an obstacle for clean coal development. Clean coal is described as a process used to trap carbon emissions from power plants, and to transport it through pipelines back into the ground to make oil wells more productive. There is a sizeable “clean coal” facility that opened in Texas last January, but generally the techniques are described as expensive and unwieldy.
As usual, away from the microphones, actual on-the-ground operations are a little more complicated, a little more expensive and a little less rosy than the pronouncements of the politicians.