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Mine Closures

Blackjewel's Eagle Butte coal mine pictured Tuesday, one day after the mine's owner declared bankruptcy and sent about 700 employees home.

Welcome to the Star-Tribune’s Energy Journal, a play-by-play of the past week in Wyoming’s world of energy. I’m your new energy and natural resources reporter, Camille Erickson.

Originally from Chicago, I completed my master’s degree at Medill’s School of Journalism at Northwestern University, and have reported on the economy, labor and politics throughout the Midwest and in Washington, D.C. I’m eager to put what I learned to work covering Wyoming’s oil, gas, coal and renewable energy sectors, and beyond.

Do you have suggestions, ideas or energy events you’d like to see highlighted in the Energy Journal newsletter? Please contact me at camille.erickson@trib.com or follow me on Twitter for the latest @camillesuzanne. Sign up for the newsletter at trib.com/energyjournal

Last week in numbers

Friday natural gas: Henry Hub $2.24, Wyoming Pool $1.62, Opal $1.65

Baker Hughes rig count: U.S 963, Wyoming 32 (as of July 3)

Quote of the week

Gillette Mayor Louise Carter-King criticized Jeffrey Hoops, CEO of Blackjewel LLC during an interview with the Star-Tribune on Wednesday. The coal company declared Chapter 11 bankruptcy, but failed to secure a $20 million loan to keep two Campbell County mines. The closures caused hundreds of workers to suddenly lose their jobs.

“If I were (Hoops), I wouldn’t show up in Wyoming.”

-- Gillette Mayor Louise Carter-King

Two Wyoming coal mines close, put hundreds out of work

In the latest blow to a region already battling an economic downturn in the coal, two mines in Campbell County abruptly closed, sending hundreds of workers home on July 1.

Blackjewel LLC, which operates Eagle Butte Mine and Belle Ayr Mine near Gillette, closed the mines’ doors after a bank denied the company $20 million in credit to continue operations during bankruptcy proceedings. The sudden closure hearkened back to March 2016, when two nearby mines laid off more than 460 workers.

A federal judge approved a $5 million loan to the company on Wednesday, avoiding liquidation for the time being. The financing will not be enough to fully resume operations at the mines, which suddenly closed Monday afternoon, a Blackjewel representative said in the hearing. It will be spent exclusively on “essential” security at the mines, firefighting personnel, professional fees of up to $500,000 and other emergency expenses.

In the latest news, the federal court convened on the Independence Holiday after several Eagle Butte and Belle Ayr mine workers said banks put holds on their cashier checks last week, ordering the company to clear all payments as soon as possible. Lawyers for Blackjewel said all of its employees in Wyoming have checks in hand and they “will be honored.”

Wyoming state lawmakers fight for uranium quota

Wyoming operators and lawmakers have intensified calls to institute a quota on uranium imports in the name of national security and energy independence. At stake is millions of dollars in possible income for the state. Several state-controlled companies abroad have flooded international markets with low-priced uranium. Federal officials said that has national security implications and results in a considerable competitive disadvantage for U.S. companies.

Improving prospects for Wyoming uranium has been a growing focus for state lawmakers over the past year, on the grounds that it would increase tax revenue and jobs. The U.S. uranium industry employs less than 400 workers, with about 50 percent of workers based in Wyoming, according to a 2019 uranium report published by the Environment Information Administration. Since 1980, the number of workers employed in uranium production decreased by 98 percent.

What to watch: Final day for bids on Cloud Peak Energy

The final day to submit bids for assets of Wyoming’s third-largest coal producer is July 8. Cloud Peak Energy, which owns Antelope and Cordero Rojo mines in the Powder River Basin, declared bankruptcy in May. A hearing to approve any sales will take place on July 18.

Unlike the mines owned by Blackjewel, mines operated by Cloud Peak have continued to run, but several Gillette residents said they feared it was only a matter of time before these mines closed too. “That's more than likely going to close,” former Blackjewel worker Gary Chambers predicted of Cloud Peak’s Cordero Rojo mine last week.

Trend: Coal, natural gas and petroleum continue to lead

For the first time in history, renewables provided more electricity to Americans than coal. But even as wind and solar production gains steam in the country’s energy economy, fossil fuels giants -- coal, natural gas and petroleum -- continue to hold their standing, accounting for 80 percent of the country’s energy consumption, according to a report released last week by the Environmental Information Agency.

The U.S. broke its own record in energy use last month, burning through 101 quadrillion Btu, most notably from petroleum and natural gas sources.

Following a trend dominating the past decade, natural gas consumption continues to climb. Last year, Americans ran through 82.1 billion cubic feet of natural gas every day. Coal consumption decreased by 4.3 percent according to the EIA’s report, bringing further uncertainty to Wyoming’s coal mines. Competition from petroleum and natural gas in the state continues to create competition with the pinched coal market.

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