Wyoming coal production slides

TOP US coal-producing state Wyoming suffered its first production decline in more than 10 years in 2009.
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Cloud Peak Energy's Cordero Rojo Mine in Wyoming.

Donna Schmidt

The US Energy Information Administration estimated Wyoming produced 427.4 million tons last year, more than 8% less than 2008 output of 467.2Mt.

Wyoming mine production accounted for 39.5% of total US production in 2009, according to the agency. One industry expert said the news was no surprise.

“It’s in line with what we were saying last year. We knew we were going to be down,” Wyoming Mining Association executive director Marion Loomis told the Gillette News-Record.

Total US coal production, according to the EIA, fell 7.8% last year. Officials are attributing this to the bad economy, including slowdowns in power and manufacturing and industrial needs, for the slide in Wyoming as well as nationwide.

American Coal Council chief executive Janet Gellici told local media that the decrease in demand had been across the board, and flush stockpiles of coal and natural gas led to lower prices in 2009, especially for the latter.

“There’s been some switching from coal to natural gas in particular (electrical generation) markets, in the southeast and Texas,” she said, noting many utilities have more generation capacity dedicated to gas.

However, the EIA said in a December forecast that gas’ share of power production was expected to slip this year, from 22% to 21%.

Coal is the source of some 50% of electric generation; moreover, most coal-rich states have a much higher percentage of coal use.

Loomis told the News-Record that while the Wyoming industry added 144 workers in the first three quarters of 2009 and experienced minimal layoffs, he doubted the current level of employment could be maintained.

He forecast another drop of 7-8% in 2010, noting that what the year brought was largely based on national economic conditions.

“If the economy recovers and we see electricity demand go back up, I think there will be a demand for more coal,” Loomis told the paper.

Wyoming has 20 active coal operations, some with seams as thick as 80 feet.

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