FUGLEBERG: What's the future of Powder River Basin coal?

2013-03-09T18:00:00Z 2013-03-09T22:14:21Z FUGLEBERG: What's the future of Powder River Basin coal?By JEREMY FUGLEBERG Star-Tribune business editor Casper Star-Tribune Online

One trillion tons of coal.

That is the total amount of coal in the ground in the Powder River Basin in Wyoming into Montana, according to U.S. Geological Survey estimates.

Of course, just because coal is in the ground doesn’t mean it’s easy to mine. No, there aren’t any mountaintops to remove to get to the basin’s coal beds, but that doesn’t mean there’s a lack of challenges.

So much so that the USGS estimates of that 1.07 trillion tons of in-place coal, only 162 billion tons is recoverable — about a seventh of the total amount of coal.

That’s still a lot of coal. But, once you factor in the current cost for coal from the Powder River Basin, the amount of coal worth mining drops even further to 25 billion tons, or about a sixth of the total of recoverable reserves.

Now that’s a number we can use, and it’s the first time the USGS has estimated such a number for an entire basin.

Survey scientists picked parts of the basin’s 47 coal beds deemed to hold recoverable coal using current mining technology, the USGS said. Then they built 10 models to account for the differences between each sample, then calculated mining cost and matched that up against the current sale price of Powder River Basin coal.

Mining in the basin pulled out 462 million tons of coal in 2011, the USGS said.

At that rate, the basin’s coal reserves at their current value will last 54 years.

Think about that number for a second. It’s not that big.

Now obviously a few things could alter that number. If the value of Powder River Basin coal goes up, that means it’ll make economic sense to mine more of the 162 billion tons of recoverable coal. If mining technology or techniques make it cheaper to mine the basin’s coal, the amount of coal worth mining will go up.

But it’s worth noting that the basin’s reserves aren’t infinite, despite their status as a mainstay of Wyoming’s energy scene and tax base, and the coal supply in the United States.

The basin’s coal producers are still doing brisk business, despite a slowdown last year. Coal still powers a large chunk of the country’s electricity production.

But just like the coal reserves, other things can also make or break Powder River Basin coal mining. Remember, mining in the area only took off in the wake of federal environmental rules. Regulations can give and take. Stricter rules or those that close coal-fired power plants will sap demand for coal from the basin.

None of this is a given. Lots of things could happen to ensure the basin’s coal is in demand for a long, long time.

But it’s worth asking a big question that might be hard to face, especially in the communities in the Powder River Basin that depend on the coal mines.

What happens when the coal runs out or nobody wants it anymore?

Reach Jeremy Fugleberg at 307-266-0623 or jeremy.fugleberg@trib.com. Read his blog at trib.com/news/opinion/blogs/boom/ and follow him on Twitter: @jerenergy.

Copyright 2015 Casper Star-Tribune Online. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(3) Comments

  1. yup
    Report Abuse
    yup - March 18, 2013 10:49 am
    No mention of new methods of mining coal such as Underground Coal Gasification?
  2. hebintn
    Report Abuse
    hebintn - March 11, 2013 7:17 am
    Hopefully we will have perfected CLEAN energy resources LONG before the 54 years is over. I have witnessed the destruction of surface coal mining in my Appalachian mountains and it saddens me greatly to imagine what they would look like with 54 more years of destructive drag lines ripping them up... once beautiful vibrant green mountains converted to wasteland.
  3. kholloway
    Report Abuse
    kholloway - March 10, 2013 7:48 pm
    Thank you for asking such an important question Jeremy!
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