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What’s a company like Arch Coal to do?
In January, the Environmental Protection Agency revoked Arch’s mining permit at Spruce — the largest proposed mountaintop removal (MTR) site in West Virginia — due to the damage already caused to the region’s watershed. This is just one more sign that regulatory enforcement is tightening around surface mining in Appalachia.
The St Louis-based coal-mining giant had been rumored to be interested in buying MTR bad boys Massey Energy, but Arch didn’t play hardball, and two weeks ago Massey sold to Alpha Natural Resources instead.
Meanwhile, 150 proposed coal-fired power plants have now been canceled, the most recent just last week in Indiana (congratulations to Purdue University for taking a smart and popular decision). These cancellations, combined with the retirement of aging coal plants, means that demand for coal in the US is falling.
Arch’s response seems to be: Invest in the West. The mines in Powder River Basin (PRB) are the largest in the nation and speculators are eying up the Pacific coast for potential opportunities to develop ports from PRB coal could be exported across the ocean to China, India and Korea.
So much for “Keeping America’s Lights On”.
The first coal port proposal on the table is at Longview, sited on the Columbia River where Washington and Oregon states meet. This site has obtained shore permits from the state of Washington, but is already facing legal challenges. Arch recently bought a significant share in Ambre Energy, the Australian company developing this port project.
Even if this port does get built, the next challenge for Ambre/Arch will be how to get significant quantities of PRB coal out to the west coast. The rail network that connects Wyoming to Washington is already close to its carrying capacity and it is hard to imagine communities throughout Montana, Idaho and Washington consenting to 50+ trains per day spewing coal dust through their neighborhoods.
The Pacific Northwest has some of the most savvy environmental advocates and attorneys and a reputation for strong environmental ideals, not to mention a noble tradition of non-violent direct action resistance to environmental threats. Companies like Boise can attest to this.
I suspect Arch may have bitten off more than it can chew.
Instead of gambling on Asian exp
orts, Arch coal would be wise to consider that earlier attempts to develop west coast coal ports in Oregon and California resulted in big $$ losses.
The smart option is not in coal, it lies in transitioning to clean energy sources, like solar and wind energy. These are energy sources that the west is happy to embrace.
*UPDATE* The New York Times broke a story today about the true extent of Ambre’s ambitions for the coal export terminal at Longview. As we suspected, this proposal is just the tip of the iceberg for coal exports from the west coast.