Bituminous Coal and Lignite Surface Mining

SIC 1221

Companies in this industry

Industry report:

This classification covers establishments primarily engaged in producing bituminous coal or lignite at surface mines or in developing bituminous coal or lignite surface mines. This industry includes auger mining, strip mining, culm bank mining, and other surface mining, by owners or lessees or by establishments that have complete responsibility for operating bituminous coal and lignite surface mines for others on a contract or fee basis. Bituminous coal and lignite preparation plants performing such activities as cleaning, crushing, screening, or sizing are included if operated in conjunction with a mine site, or if operated independently of any type of mine.

Industry Snapshot

In 2008 there were 852 surface mines in the United States that produced 814 million short tons of coal. During 2009 the total number of mines fell to 835, as did production to 742 million short tons of coal. Wyoming remained the leader with 19 surface mines responsible for 427 million short tons in 2008, a decrease of 7.9 percent compared to previous year. During 2009 Wyoming's production increased to 464 million short tons.

In 2006 there were 812 surface mines in the United States, which produced 803 million short tons of coal. That accounted for 69 percent of the nation's coal production. Wyoming, the country's dominant surface mining state, had 20 surface mines that produced 446 million short tons of coal. The 13 mines within Campbell County in Wyoming accounted for 397 million short tons of coal.

Including underground mines, U.S. coal production totaled 1.16 billion short tons in 2006, up 2.8 percent from 1.13 billion short tons in 2005. That number increased to 1.17 billion short tons before plummeting to 1.07 billion short tons in 2009, a decline of 99.1 million tons or 8.5 percent compared to 2008.

Surface mining faces many of the same issues as underground coal mining, including regulatory restrictions, environmental concerns, and declining prices. Surface mines also must address reclamation issues pertaining to abandoned and depleted mines.

Organization and Structure

According to the Energy Information Administration, some 1,400 mines operated in twenty-six states in 2006. Surface mining was the exclusive mining technique used in nine of those states. Mines ranged in size from small facilities that generate several thousand tons of coal per year to mammoth surface operations that extract 10 to 20 million tons per year.

The Mining Process.
Surface mining usually is practiced on relatively flat ground; the coal is recovered from a depth of less than 200 feet. At mines where the coal is located on steep inclines, though, material may be excavated from open pits that can reach depths of several hundred feet.

To reach coal deposits, miners must first remove the overburden, or strata, that covers the coal bed. Up to thirty cubic yards of strata must be excavated for each ton of coal recovered. Dragline excavators, power shovels, bulldozers, front-end loaders, scrapers, and other heavy pieces of equipment are used to move the strata and extract the coal.

The two common methods of surface mining are strip and auger. At strip mines, large drills bore holes in the strata. Explosives are placed in these cavities and detonated. Power shovels or draglines operating at surface level then move the broken strata, while power shovels below dig up the coal and load it into trucks. The strata and coal are removed in long strips. This is done so that the debris from the newest strip can be dumped into an adjacent strip, from which the coal already has been recovered.

Auger mining consists of boring a series of holes that are two to five feet in diameter and 300 or more feet deep. This parallel and horizontal pattern is carved into a seam of coal that has been exposed by an outcropping or by strip mining methods. No blasting takes place, and the overburden is left intact. The coal simply is removed and loaded into waiting trucks. Auger mining frequently is used in open-pit mines, where the strata is too thick to remove it economically using strip methods.

Because surface mining is less expensive and more productive than traditional underground mining, new surface extraction technology has allowed this method to dominate U.S. coal production. Moreover, producers are able to remove an estimated 90 percent of the coal at surface mines, while underground mines permit only a 50 to 80 percent extraction rate, depending on the mining method used.

After it is processed, different types of coal are often blended to produce uniform grades of commercial material. Blending also may occur at the point of use. Coal preparation plants can produce anywhere from 200 to 20,000 tons of coal per day. From the preparation plant, 70 percent of the coal is delivered to users by rail. Barges and ships deliver an additional 20 percent of industry output. Some coal also is stored for future use.

Coal Products.
Four grades of coal mined in the coal industry include lignite, subbituminous, bituminous, and anthracite. Each grade differs in moisture content, volatile matter, and fixed carbon content. Anthracite, the highest grade material, accounts for less than one-half of 1 percent of total output and is classified in its own industry (see SIC 1231: Anthracite Mining).
Bituminous coal, or soft coal, is the most common type of coal produced in the United States. It represents more than 70 percent of total industry output and accounts for approximately 50 percent of total U.S. reserves. The mineral is composed of 80 to 90 percent carbon and about 10 to 20 percent moisture. A ton of bituminous coal typically generates nineteen to thirty million BTUs (British Thermal Units) and ignites at between 700 and 900 degrees Fahrenheit. Bituminous coal possesses a relatively low sulfur content, which causes it to burn more cleanly than some lower grades. Because of its properties, bituminous coal is the principal steam coal used for generating electricity. It also is the primary coking coal used in the steel-making process.

Bituminous coal can be further categorized as low-, medium-, and high-volatile coal, according to its moisture content and heating capacity. Low- and medium-volatility grade bituminous coal typically generates between twenty-six and thirty million BTUs per ton. High-volatile coal, in contrast, usually produces anywhere from eighteen to twenty-nine million BTUs per ton. For comparison, a ton of bituminous coal, assuming an average twenty-two million BTUs, produces about the same amount of energy as one cord of hardwood, 22,000 cubic feet of natural gas, or 160 gallons of fuel oil.

Subbituminous coal has a 75 to 85 percent carbon content. It produces sixteen to twenty-four million BTUs per ton and is used primarily to generate electricity. In 1995 subbituminous coal represented 31.7 percent of industry output. Although its sulfur content is low relative to lignite, a high moisture content, along with other negative properties, makes it less desirable than higher coal grades for most applications.

Lignite, the lowest-ranked coal, is a brownish-black mineral containing a moisture content of 30 to 40 percent. It produces about nine to seventeen million BTUs per ton and ignites at roughly 600 degrees Fahrenheit. Because it deteriorates rapidly in air, has a high sulfur content, and is liable to combust spontaneously, lignite mainly is used to generate electricity in power plants that are close to mines. In 1995 lignite accounted for 8.3 percent of industry production. Lignite also is subject to high royalties charged by the federal government.

Coal Consumers.
In 1998, 83 percent of the coal produced in the United States, 912.1 million short tons, was consumed by utilities. By 2006, electric power consumption accounted for 1.026 billion short tons of coal, or 88 percent of the 1.161 billion short tons produced in the U.S. Coal-fired facilities produced approximately 50 percent of the total electricity generated domestically.

The second-largest coal customer was the general industry sector, which accounted for 60.5 short tons of coal in 2006. Industry uses for coal include production of materials such as calcium carbide, silicon carbide, refractory bricks, carbon and graphite electrodes, and various food and paper products. Coal also is used to produce gall and stone, primary metals, textiles, and plastics. One of the largest industrial uses of coal is cement production.

Iron and steel manufacturers are the third-largest coal consumers. These industries use coal to produce coke--a primary ingredient in the smelting of iron. In 2006 approximately 23 million short tons of coal was used in the processing of iron and steel.

Background and Development

Coal is not a true mineral, but rather an organic compound formed from the remains of living organic material that flourished 250 to 400 million years ago. The Chinese are believed to be the first to have used coal, in about 1000 B.C. The Romans also are believed to have burned the material. The first written history of coal dates back to 1200 A.D., when metalworkers in Europe were observed using it.

Widespread use of coal did not occur in Europe until the fifteenth and sixteenth centuries. Advances that significantly promoted the use of coal during the eighteenth century included Abraham Darby's methods of using coal instead of charcoal in blast furnaces and forges, as well as the coal-burning steam engine developed by James Watt.

Although coal mining was taking place in North America as early as 1701 in Virginia, it was not until 1745 that coal was mined in the colonies on a commercial scale. During the American Revolution, when European sources of coal became inaccessible, the fledgling industry's importance increased. By the early 1830s, many small coal-mining operations had sprung up along rivers in Appalachian regions. In the 1840s the industry mined its first million tons.

The advent of the steam locomotive in the middle and late 1800s prompted a huge expansion of the coal industry, as producers took advantage of that important new channel of distribution. This development, in conjunction with the start of the Industrial Revolution, resulted in huge industry growth. Between 1865 and 1905, for instance, production ballooned from 182 million tons to 928 million tons. Although the United Kingdom led world coal production throughout the nineteenth century, the United States surpassed that country as the leading producer in 1900. In that year, U.S. companies mined 250 million tons of coal. By 1935 world output stood at 1.18 billion tons.

Growth in the use of coal, mostly to generate energy and to create iron and steel, continued at a moderate pace until the middle 1900s in most industrialized countries. By 1958 annual demand for coal in the United States stood at about 400 million tons. However, massive growth in demand in previously undeveloped regions, such as the former U.S.S.R. and China, had pushed global consumption past 2.5 billion tons by the 1950s.

In the 1950s and 1960s demand for coal realized solid growth in the United States, despite the increasing popularity of alternative energy sources, such as petroleum and hydropower. During those decades, a booming postwar economy spurred demand for coal by utilities and iron and steel makers, as well as other commercial industrial sectors.

Growth of Strip and Auger Mining.
Coal was first taken directly from exposed ledges and outcroppings. When this meager supply was consumed, however, miners began to scratch beneath the earth's crust using surface, or open-cut, mining equipment. After easily accessible surface coal had been extracted, and the strata became too thick to remove, companies were forced to mine for coal using costly underground operations. Underground mines, though, could not safely access coal that was close to the earth's surface because the risk of the mine collapsing was too great. For this reason, much of the coal that lay just beneath the earth's surface, but also under thick strata, remained inaccessible.

In the 1960s and 1970s, improved earth-moving equipment catapulted the surface, or strip mining, industry to center stage. New tools allowed miners to remove overburden more than 200 feet thick. Massive power shovels, many taller than a twelve-story building, were developed that could remove up to 115 cubic yards of debris in a single bite. New earth-hauling trucks had equivalent capacities. Similar advancements propelled auger-mining technology, which originated in the 1940s. Indeed, massive drills, conveyors, and haulers made auger mining, like strip mining, preferable to many forms of underground mining.

Coal companies were finding that, in most cases, they could extract coal using new surface-mining techniques more cheaply and efficiently than they could using even the latest underground mining technology. Surface mining accounted for 35 percent of total U.S. coal production in 1965. By the late 1970s, however, auger and strip mining operations accounted for a full 60 percent of industry output. Because surface mining is not always applicable in mountainous regions, such as Appalachia, coal extracted from underground mines accounted for 38 percent by 1995.

Labor Influence.
The early mining industry in the United States and Europe was characterized by a history of worker exploitation as well as dismal and dangerous working conditions. For these reasons, the impetus to form and maintain strong labor unions has played an integral role in the development of the industry.

The first U.S. coal labor union appeared in Illinois in the 1890s. By 1900 unions were present in five other states. Eventually, the United Mine Workers of America (UMW), a national organization, became the dominant labor influence in the industry; by 1940 the UMW represented more than 800,000 mine workers. Federal and state governments also became active in the protection of mine workers in the first half of the century. Following a succession of mine explosions in 1907 that killed thousands of miners, the Bureau of Mines (BOM) was created. Several states also began requiring mine safety inspections.

The industry death toll continued to rise, however, prompting the federal government to establish mine safety standards in 1941, although these regulations were not enforced until 1946. In 1969 Congress passed the Coal Mine Health & Safety Act (CMHSA). Adding to federal and state efforts were international organizations, such as the Coal Mining Industrial Committee, which was formed in 1945 to improve mine workers' conditions on a global scale. Between 1968 and 1991, mine fatalities decreased from 0.27 fatalities per 200,000 man-hours to 0.05--a reduction of 81 percent. Injures declined as well, by about 29 percent.

By the 1960s labor organizations had become so strong in the mining industry that about 75 percent of all coal was produced by UMW members. Furthermore, several other unions appeared, including the Progressive Mine Workers of America, the International Brotherhood of Electrical Workers, and the International Union of Operating Engineers. These combined labor forces vastly improved wages and working conditions for miners in the 1960s, 1970s, and 1980s. Critics, however, argued that labor unions had become too strong and were sapping coal-industry productivity and health.

The 1970s and 1980s.
Many coal producers fell on hard times during the 1970s--a result of several factors. A principal reason for the industry's decline was a marked decrease in productivity and an increase in salaries and benefits. Federal safety regulations, for instance, were blamed for slashing productivity by almost 50 percent between 1969 and 1978--from 1.95 miner hours per ton to 1.04. The Coal Mine Health & Safety Act (CMHSA) regulations forced companies to hire more personnel and alter existing labor practices that were deemed unsafe or unfair.

Of critical importance to the coal-mining industry in the 1970s, as well as in the 1980s and 1990s, were federal environmental regulations that cut into the profits of industry players. A series of state and federal bills dealing with land reclamation, for instance, were blamed for decreased productivity at surface mines--down to 3.03 tons produced per man hour in 1977 from 4.74 tons in 1974. The Surface Mining Control and Reclamation Act (SMCRA) of 1977 also set up a provision for cleaning up old mining sites. That provision, which among other things instituted a tax of 35 cents per ton on all surface-mined bituminous coal, generated $256 million in 1996.

Another factor that hurt producers in both the 1970s and 1980s was a decrease in the growth of coal demand. Hydro, nuclear, natural gas, and oil sources continued to reduce coal's total contribution to domestic energy consumption. Although coal production grew at a rate of 5.7 percent in the 1970s and 3.8 percent in the 1980s, this was down from a 7.3 percent annual growth rate in the 1950s and 6.6 percent average annual growth during the 1960s.

During the 1980s, however, many coal producers succeeded in overcoming the profit barriers that arose during the 1970s. Although total growth in demand for coal declined in the 1980s, the industry was able to increase its contribution to total U.S. energy consumption from a low of 17.6 percent in 1973 to more than 25 percent in the late 1980s. Even a significant reduction in the use of coal by iron and steel producers was not enough to offset increased consumption by utilities, which were seeking less expensive alternatives to oil.

Coal companies also enjoyed growing success in increasing productivity and extracting labor concessions in the 1980s. Technological advancements in automation and mining techniques allowed producers to realize massive productivity gains between 1980 and 1990. Productivity at surface mines shot up from about three tons per man hour in the late 1970s to more than six tons per hour by 1990, and continued to rise. As a result, total industry employment declined from about 240,000 workers in 1978, when 665 million tons of coal were shipped, to 81,000 workers in 1995, when 1.12 billion tons of coal were produced.

The 1990s.
As industry employment diminished and new surface-mining plants opened in western states, labor's influence on the industry declined. Indeed, the portion of coal produced at UMW mines had declined to about 30 percent of the total by 1990, while the percentage of U.S. coal mined by members of all labor unions had fallen to 55 percent. By 1995 about 27 percent of miners at surface mines belonged to the UMWA, and another 11 percent belonged to other unions.

Industry participants also insisted that they had made strides in meeting environmental challenges, pointing to new mining, processing, and coal-burning technologies. Environmental groups, however, remained opposed to many aspects of the coal-mining industry.

Despite successes in the 1980s, industry profit growth was held in check by relatively stagnant demand growth and declining prices. Production outpaced demand, forcing prices down. Between 1992 and 1995, for instance, the price of coal dropped from $21.03 per ton to $17.52 per ton, using constant 1992 dollars.

Overall coal production realized very modest gains from 1991 to 1998, averaging less than 1 percent annual growth. There was a slight decrease from 1994 to 1995, but figures for 1996 indicated growth of more than 2 percent. Surface mining, however, grew steadily. While coal production east of the Mississippi, where most underground mines were located, fell 3.9 percent from 1994 to 1995 (to 544 million short tons), coal production in the western states, where surface mines predominate, increased by 4.6 percent to a record 489 million short tons. In 1998 surface production stood at 686.6 million short tons. Prices continued to decline, though, at the same time that production costs were rising.

Mines continued to close, and employment continued to decline across the whole coal-mining industry, with a net loss in 1995 of 250 mines and about 7,000 miners. Employment at surface mines declined by 9.9 percent from 1994 to 1995, to about 32,000 miners. However, productivity continued to increase. Miner productivity east of the Mississippi grew to 3.45 short tons per miner per hour, while in the West productivity rose 7.0 percent to 14.18 short tons.

Phase One of the Clean Air Amendment Act of 1990, which set a goal of cutting sulfur dioxide emissions nationwide by 10 million tons by the year 2000, went into effect on January 1, 1995. The law required electrical generating plants to lower smokestack emissions of sulfur compounds, but gave utilities wide latitude in how this might be accomplished. Plants that exceeded requirements received allowances that could be sold or exchanged on the open market. Because of this market-based approach, the legislation had not, by the time Phase One went into effect, had the calamitous effect that some analysts had feared. Most utilities had not found it necessary to install expensive scrubbers, but had found switching to low-sulfur coals and purchasing allowances adequate to meet the law's requirements. Midwestern mines that produced coal with a higher sulfur content felt the impact of the legislation most severely, while western low-sulfur coal producers experienced some relative benefit. The threat of increased environmental controls related to carbon dioxide emissions and land reclamation was, however, a source of concern for many producers.

Electric utilities continued to consume the vast majority of surface-mined coal and lignite. In 1998 electric utilities used 912 million short tons. A study by Resource Data International Inc., reported in July 1996, projected continued domination of electricity generation by coal through the year 2015. Annual increases of 1.3 to 2.1 percent were forecast.

Another segment in the energy market that held promise for coal producers was nonutility power producers. Since passage of the Public Utility Regulatory Policies Act (PURPA) of 1978, several new types of nonregulated power facilities had developed. These entities usually sold their output to public utilities. Nonregulated facilities included nonutility generators, independent power producers, and cogenerators.

The early 2000s.

Effects from a rebounding economy were translated into profits for the coal industry. Coal prices rebounded significantly during 2004, after numerous years of decline. The average price of delivered coal was $39.30 per short ton, a 13.2 percent increase from 2003. Coking coal prices averaged $61.50 per short ton, a 21.5 percent increase, and industrial steam coal prices averaged $39.30 per short ton, a 6.0 percent increase. Coal prices are determined by a number of factors that are beyond the industry's control, including weather patterns and enactment of environmental regulations concerning smokestack emissions and mine cleanup and restoration.

Surface mining evokes particular reactions from environmentalists due to the large land areas that are altered by surface-mining operations. Previously abandoned surface mines that were not properly restored led to the industry's negative image. The Department of the Interior's Office of Surface Mining oversees land recovery of mines that were abandoned or depleted prior to 1977. According to the Office of Surface Mining, during 2004 more than 4.2 million acres were under permit for land mining, including more than 116,000 new acres awarded permits during the year. Within the year about 50,084 acres completed Phase Three of reclamation and were released from the reclamation program. Out of 32 surface mining states and tribal reservations, 23 states and reservations reported one billion acres of disturbed lands that were in need of reclamation at the close of 2004.

In February 2002, President George W. Bush introduced the Clear Skies Act, a series of amendments for the established Clean Air Act (CAA) in an effort to lower emissions from unsafe contaminants such as sulfur dioxide, nitrogen oxides, and mercury from power generators by 70 percent over the next 20 years. However, that legislation was never adopted. Then, the same legislation was reiterated in February 2003, and again in March 2005. Public Works voted on President Bush's Clear Skies Act of 2005 during the same time the U.S. Environmental Agency (EPA) was attempting to enact the Clean Air Mercury Rule. Unfortunately, for the coal industry, the Clear Skies legislation was struck down once again.

The EPA's Clean Air Mercury Rule was the first step in controlling mercury restrictions for coal-fired power plants. Phase One of the Clean Air Mercury Rule set a goal of cutting mercury emissions nationwide by 38 tons by 2010, whereas Phase Two would lower mercury emissions to 15 tons commencing in 2018. The total cost was expected to run about $50 billion over a 20-year period.

Although the Clean Air Mercury Rule was passed, those that were directly affected would have preferred the Clear Skies legislation. For example, the Pennsylvania Department of Environmental Protection (PADEP) disputed the Mercury Rule, arguing that it was "creating an unfair marketplace that puts Pennsylvania at a competitive disadvantage" since bituminous coal and sub-bituminous coal have differing emission standards. Power generators also expressed that the Clear Skies Act would have been a better choice since "it would provide similar improvements in air quality with more regulatory certainty."

A total of $62.4 million was designated for "clean coal" research projects in March 2005. Since coal is the most plentiful energy resource, the research will be directed toward the development of a "coal-fired zero emissions power plant" that would enable the United States to be totally independent from foreign sources for its energy needs.

Although coal production increased in each of the Appalachia, Western and Interior regions in 2005, the first time since 2001 that had happened, the transportation of coal became hampered by flooding due in part to three major hurricanes (Dennis, Katrina, Rita) in addition to the disruption of rail traffic from the Powder River Basin (PRB) because of track maintenance. Rail transportation of coal, though, improved from the troubles of 2005.

Total U.S. coal consumption declined slightly from 2005 to 2006, from 1.125 billion to 1.114 billion short tons, because of mild temperatures and declining natural gas prices. Total coal stocks, however, increased 27 percent.

In 2006 the average open market sales price of surface-mined coal in the United States was $18.88 per short ton, while the average coal price including underground mining was $25.16.

Current Conditions

Total U.S. coal consumption declined significantly from 2008 to 2009, from 1.171.8 billion to 1.072.8 billion short tons. While all consumers of coal reported declines for 2009, the electric power sector reported the largest decline at 10 percent. Total coal stocks, however, increased 16.4 percent or 33.7 million short tons closing the year at a record level of 238.8 million short tons.

While consumption was slated to rise 5 to 7 percent in 2010, excess stock piles were expected to hinder the recovery process. Coal operators indicated it may not be until the third-quarter of 2010 when the market resorts back to normal conditions. The National Mining Association projected total U.S. coal production to fall 0.7 in 2010, however, production from Eastern coal fields was projected to decline by 2.9 percent.

Industry Leaders

The coal industry has undergone a period of consolidation that began in the mid-1970s. Since that time, the number of coal producers declined from 2,300 to about 1,500 by 1993. The number of mines those companies operated fell during the same period from 6,200 to 3,200. In the 1970s a number of energy companies such as Exxon, Shell, and Sun Oil had acquired coal properties in an attempt to diversify, but soft prices for both coal and oil encouraged many of these companies to sell off some or all of these acquisitions. Large coal operators such as Peabody Holding, Zeigler Coal, and Cyprus AMAX Minerals purchased many of these existing mines.

The largest U.S. producer of coal in 2006 was Peabody Energy Corp., which produced 208 million tons for 17.9 percent of the U.S. total. Rio Tinto Energy America (Kennecot) followed with 134.4 million tons and 11.6 percent of the U.S. production. The only other company to top 10 percent of the U.S. total was Arch Coal, Inc. at 129.5 million tons for 11.1 percent.

Arch Coal, Inc. did have the highest-producing surface coal mine, with the Black Thunder mine in Wyoming producing 92.5 million tons. All of the top 10 U.S. surface coal mines for 2006 were Wyoming mines. Peabody Energy Subsidiary has the second-largest producer, the North Antelope/Rochelle mine. Rio Tinto Energy America (Kennecot) had the next three highest producers.

Among the major coal-company deals in 2006, Alpha Natural Resources acquired assets from Progress Fuels Corps., including the stock of Diamond May Coal Co. and Progress Land Corp., in May. Also, in January Arch Coal, Inc. sold its Hobet Mining, Apogee Coal Co., and Catenary Coal Co.

The coal industry experienced its share of deals throughout 2009. In July of 2009, Alpha Natural Resources, Inc. and Foundation Coal Holdings merged their operations. That followed with Arch Coal, Inc.'s acquisition of Rio Tinto's Jacobs Ranch Mine located in the Powder River Basin in October of 2009. Then, Rio Tinto Energy America spun off all but one of its coal mines (Colowyo) in an initial public offering in November of 2009. The new entity called Cloud Peak Energy, Inc. will be comprised of the Antelope, Cordero Rojo and Spring Creek mines in the Powder River Basin.

The largest U.S. Producer of coal in 2009 was Peabody Energy Corp. with output totaling 192 million tons, which accounted for nearly 18 percent of domestic production. The second-largest producer of coal in the United States was Arch Coal, Inc. at 147.7 million tons, responsible for nearly 14 percent of total U.S. production. In third-place, Cloud Peak Energy produced 93.3 million tons or 8.7 percent of total production.

The top producing surface mines based on production in 2009, all of which were centered in Wyoming's Powder River Basin coal region were Peabody Energy's North Antelope Mine, with 98.3 million tons; Arch Coal's Black Thunder Mine, with 81.2 million tons; Cloud Peak Energy, with 39.3 million tons; Cloud Peak Energy's Antelope Mine, with 34 million tons; and Arch Coal's Jacobs Ranch Mine, with 29 million tons. Alpha Natural Resources, Inc. came in fourth with production totaling 85 million tons, of 7.9 percent of domestic production. Rounding out the top five CONSOL Energy Inc. had production totaling 59.4 million tons or 5.5 percent of production.

Workforce

The number of workers employed by U.S. coal producers increased from 79,283 in 2005 to 82,959 in 2006, a 4.6 percent jump. Among surface-mining workers, jobs increased 5.4 percent from 33,572 to 35,398. Surface-mining operations are less susceptible to labor cutbacks than underground mining facilities, and surface mines are considerably less labor intensive and provide fewer job opportunities per ton of coal produced than do underground mines. Labor positions in the surface-mining industry are concentrated in the maintenance and operation of heavy machinery. In addition, surface-mining companies have a higher proportion of management and clerical workers than the overall coal industry. In 2008, 86,859 people were employed within the coal-mining industry. The total reached 87,755 in 2009, in which 37,505 comprised surface-mining jobs.

Labor unions have pushed hard to get companies that have opened new surface mining operations to employ workers who were displaced from underground mining jobs.

The National Mining Association's 2006 Coal Producer Survey indicated the workforce was aging. Of the companies that responded, 48 percent estimated that the average age of their workforce fell in the 45-50 range, another 36 percent put the estimate in the 40-45 range, and 6 percent estimated the average age to be in the 35-40 range.

America and the World

The amount of coal exported from the United States has decreased considerably. In 1998 exports stood at 76.2 million short tons; by 2002 exports dropped dramatically to 39.6 million short tons, although that number grew to 49.6 short tons by 2006. Imports during that same period increased, from 16.9 million short tons in 2002 to 36.2 million tons in 2006. Canada was the largest consumer of U.S. coal in 2006, absorbing 15.3 million short tons of steam coal. Following stellar performance in 2008, exported coal plunged 27 percent in 2009 to 59.1 million short tons, however, the average price per ton increased to 3.8 percent compared to 2008.

Coal imports reached a record level of 36.2 million short tons in 2006, an increase of 19 percent from the previous year. Seventy percent of total coal imports come from Columbia, which along with Venezuela, Indonesia, and Canada accounted for 96 percent of the total U.S. coal import market. Coal imports fell 33.8 percent to 22.6 million tons in 2009.

World coal consumption is projected to increase 74 percent from 2004 to 2030, with China leading this growth. Production in China, the U.S., and India is expected to grow along with each country's domestic demand, while Australia, New Zealand, Russia, and nations in Central and South America are expected to increase exports. By 2030, it is projected that the U.S. imports of coal will be greater than exports, due in part to increased demand in the Southwest and declining productivity in the Appalachian region, and as of the mid-2000s, U.S. ports were being expanded in anticipation of this increase.

Research and Technology

To maintain economic viability and their position in the global export market, U.S. surface mining firms have continued to rely on technological advances to overcome imposing barriers that face them. Of great importance were projects to improve the cleanliness and efficiency of coal-fired electric power plants. The U.S. Department of Energy was developing five categories of research. Low-emission boiler systems incorporated advanced combustion and innovative flue gas cleaning systems in the initial design for new power plants. Pressurized fluidized bed combustion captured sulfur pollutants inside the boiler instead of in the stack and allowed combustion at temperatures below the point at which most nitrogen pollutants form. The integrated gasification combined cycle (IGCC) employed coal gasification rather than traditional combustion and combined a steam turbine driven by exhaust heat with the gas turbine driven by the coal gas. Indirectly fired cycles employed a design that heated a working fluid, such as air, to turn the turbine rather than the hot gases of combustion. Finally, integrated gasification-fuel cell combinations would link a coal gasifier with a fuel cell. By 1995 pressurized fluidized bed combustion systems and integrated gasification combined cycle (IGCC) systems were in commercial use. The primary goals of the industry at present are to produce coal more efficiently and more safely, as well as to encourage scientists to find cleaner ways in which it can be used and decrease dependence upon foreign oil.

Additional innovation in the industry focuses on the continual improvement of equipment and methods, including the introduction of computerized process control, global positioning systems, equipment sensors that can distinguish between coal and black shales, revised configurations for haul trucks, and larger bucket sizes on in-pit excavators.

© COPYRIGHT 2018 The Gale Group, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. For permission to reuse this article, contact the Copyright Clearance Center.

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Producer Price Indexes, May 2014
PPI Detailed Report; May 1, 2014; 700+ words
...211112-SM Mining (except oil & gas) 212 12/14 Coal mining 2121 12/85 Coal mining 21211 12/14 Bituminous coal and lignite surface mining 212111 12/14 Primary products 212111-P 12/14 Run-of-mine (raw) bituminous coal and lignite...

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