Two years ago, Alabama’s coal mining boomed. Industries worldwide gobbled up coal as quickly as they could get it.
Now, coal is being stockpiled, and in some cases, mining is being curtailed because world demand has fallen as coal-fired industries cut production.
Alabama’s coal mines are not immune, although they might be faring a little better than the industry as a whole.
At Jim Walter Resources, which operates two of the country’s deepest underground coal mines near Brookwood, employment remains steady, but now is on a five-day workweek, according to company and union officials.
Daryl Dewberry, international vice president for the United Mine Workers of America District 20, which comprises much of the Southeast, said the union is working closely with the company to keep miners on the job.
“There have been no layoffs at Jim Walter,” he said. “They are attempting to keep as many miners working as possible.”
Jim Walter’s Tuscaloosa County mines and their coal-processing facilities employ about 1,300 people, making the company the state’s biggest coal company.
But in neighboring Jefferson County, another major coal company, Drummond Coal, recently laid off 56 miners at its underground Shoal Creek mine as it moved to a four-day workweek, Dewberry said.
That, and the possibility of more layoffs at the state’s mines, has Dewberry concerned.
He believes the nation is at the tail end of the recession, but he said the coal industry often is one of the last industries to be hit by a recession and one of the last to recover.
“We anticipate that we will be taking some hits,” he said.
That nervousness also is being felt by rank-and-file union members.
Gary Youngblood, a contract coal hauler and a member of the Tuscaloosa County Commission, said the coal stockpiles are getting bigger in West Alabama and that is cause for concern.
The coal is not getting shipped like in the past, and if the stockpiles get too high, the coal companies might have to cut their production, he said.
“That affects everybody who works in the coal industry,” said Youngblood, whose family spans three generations in Alabama’s coal mines.
Even if demand for coal picks up, it will take time to reduce the stockpiles, keeping a lid on coal production and its corresponding employment, he said.
Even so, Youngblood said he never regretted his decision to follow his father and uncle into a career in the coal industry nor the fact that he has a son-in-law working as a miner at Jim Walter.
“It has been mighty good to me,” he said of his job. “It was and is a good way to make a living.”
While miners may be eying the coal stockpiles, the state’s coal industry is keeping a watchful eye on one of its biggest customers, the global steel industry.
Steelmakers have been hit hard by the recession as manufacturers of everything from automobiles to machinery have cut production and, thus, their orders for steel.
Action like U.S. Steel’s recent decision to shut down much of Fairfield Works in Jefferson County is not good news for coal producers.
Alabama’s coal, more so than coal from other states, fuels the steel industry. The state’s biggest coal seams — which run through Tuscaloosa, Fayette, Jefferson, Walker and Shelby counties — lie at the southern end of the Appalachian coal belt, which covers some of the world’s biggest coal reserves.
About two-thirds of Alabama’s coal is the high-grade metallurgical coal, said Dave Roberson, president of the Alabama Coal Association, a trade association that represents the coal companies and their vendors. The other third of the state’s coal, which comes mostly from surface mines, is sold to companies like Alabama Power for their coal-fired power plants.
Jim Walter’s Brookwood mines have the distinction of being the southernmost coal mines in the Appalachians. They also have the distinction of having some of the world’s best metallurgical coal, which is prized for making steel.
Known as Blue Creek coal, the coal has very low sulfur content with a high heat value, making it ideal for coking — a process that removes coal’s impurities so it can be used in steelmaking.
Most of Jim Walter’s coal is exported, said Dennis Hall, a company spokesman.
“The global steel market is down and that has affected us,” he said.
But Hall noted that Blue Creek coal’s composition makes it more attractive to global steelmakers than other types of coal.
Still, coal shipments are down this year at the Alabama State Port Authority in Mobile.
“We are seeing a little decline in our [coal] exports,” said James K. Lyons, the authority’s director.
“We normally run six to 12 coal ships per month at the port. Right now, we are running at the lower end of that.”
Coal ships are bulk carriers that can haul 40,000 tons to 100,000 tons of coal with the average being in the 70,000-ton to 75,000-ton range, he said.
“Our coal exports are largely metallurgical coal that goes into steelmaking. The steel market globally is down 50 percent, so the amount of coke needed is not quite as high,” Lyons said.
Coal typically accounts for 20 percent to 25 percent of the exports leaving the port and is the port’s biggest commodity, he said. Some coal also is shipped into the port and purchased by coal-burning power plants, Lyons said.
When the coal stockpiles will fall and coal shipments will pick up depends heavily on the recovery of the global economy.
As for the long-term future of the of the coal industry, there is no debate on two points — there is an abundance of coal in the United States and new technology has made its recovery easier.
In 1979, Alabama’s mines produced 12.5 million tons of coal and employed 18,500 unionized miners, said the UMWA’s Dewberry. Today, the state’s mines produce more than 20 million tons of coal with 3,200 unionized miners. There are about 500 non-unionized miners in the state.
“It’s less labor-intensive today, and we can go deeper to get coal we could not get 30 years ago,” Dewberry said of coal mining.
Proposals coming out of Washington for clean-coal technology won’t hurt the industry, he said.
“Coal miners are not afraid of clean coal. We have a good supply of coal,” he said. ... “There’s a lot of things out there that we can do to use coal” with clean-coal technology.
Much of the clean-coal technology has not been put into widespread use and what processes will ultimately be embraced by industries remains unknown.
But not all the proposals coming out of Washington may be good news for the coal industry.
Roberson of the state coal association said “cap and trade” proposals that cover harmful gas emissions by industries will result in higher electric bills for consumers and will hurt the state’s surface mines, whose coal goes to power plants.
Cap and trade, which is being pushed by the Obama administration, would limit the amount of carbon dioxide and other harmful gases that power plants and industries could emit into the air. Carbon dioxide is emitted when coal is burned.
Under cap and trade, industries that emit less gases than their government-issued permit allow could sell credits for their unused emissions to other industries that exceed their allowed emissions.
Source: Tuscaloosa News
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