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Coal train coming

Plans to ship millions of tons of coal across Montana have fueled new debate over an old industry

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In 1989, the Canadian mining company Noranda announced its plan to develop the New World gold mine near Cooke City, Mont. Cooke City is just as deserted as Ashland, but benefits from a noteworthy neighbor, Yellowstone National Park, which sits a little south of the tiny burg. When news of the plan got out, the national media seized on the imagery of America's first national park being despoiled by a Canadian conglomerate's gold mine, and it fast became the cause du jour of armchair environmentalists around the world. The United Nations declared Yellowstone "endangered," and speaking to national media became a pastime in Cooke City.

The plan was dramatically averted when the Clinton administration stepped in and spent $22.5 million to buy up the mining claims. President Clinton himself helicoptered into the area to sign the papers and get his photo taken.

But a less-reported aspect of the deal lit a fuse that is still burning: The federal government also granted the state of Montana the Otter Creek coal tracts in far-off Powder River County to make up for the lost revenue it would have earned from the gold mine. The deal all but ensured that a coal mine would be coming to McRae's backyard.

"They should have had the guts to just say no to that mining company," McRae bellows over the convention center din.

Still, Otter Creek coal hasn't been touched since, which gets us to the candy mogul.

More than 60 Montanans bused to Spokane, Wash., in December to protest the proposed Gateway Pacific Terminal. “These coal trains that are hauling America’s energy resources to the coast for export to China do not magically appear at the Washington-Idaho border,” said Beth Kaeding of Bozeman, noting the impacts on Montana residents. - PHOTO BY MATTHEW FRANK
  • Photo by Matthew Frank
  • More than 60 Montanans bused to Spokane, Wash., in December to protest the proposed Gateway Pacific Terminal. “These coal trains that are hauling America’s energy resources to the coast for export to China do not magically appear at the Washington-Idaho border,” said Beth Kaeding of Bozeman, noting the impacts on Montana residents.

Until now, any mining in that corner of the Powder River Basin has been staved off, thanks largely to the efforts of Forrest Mars Jr. He owns a Montana ranch in the Powder River Basin, situated squarely between the coal tracts and Wyoming, where mining companies would have traditionally shipped the coal before its ultimate destination, Midwest power plants. Using a tiny slice of the $18 billion he'd earned from America's love of Twix and Three Musketeers bars, Mars helped successfully stall the railroad that would be needed to mine the Otter Creek coal tracts.

But that all changed in 2011, in another twist in what one area rancher called the soap opera of southeast Montana: Mars suddenly informed area environmental groups that he would no longer help fund their legal fights—in fact, he'd bought a third of a stake in the proposed railroad.

Over the coming months, the reason became clear to the baffled clutch of cattle ranchers: The coal would no longer cross Mars' ranch. Instead, it was headed west to Washington.

Five coal-export terminals are now in various stages of development in Oregon and Washington.

One that's garnered significant attention, especially in Seattle, is the Gateway Pacific Terminal in Cherry Point, Wash., just north of Bellingham. The export facility, if approved, would be able to handle 48 million to 54 million tons of coal per year, which pencils out to nine full trainloads of coal per day, according to a February 2012 study conducted by Gibson Traffic Consultants. That would mean 18 more trains through Seattle each day, presuming that cars emptied in Cherry Point would head back to Wyoming and Montana. Another study, commissioned by Seattle Mayor Mike McGinn, estimates that gates at railroad crossings citywide would be down an extra 96 minutes every day.

The other four export terminals proposed for the Pacific Northwest would be at the Ports of Coos Bay, St. Helens and Morrow in Oregon and the Port of Longview in Washington. Meanwhile, British Columbia has three coal-export terminals in operation: Neptune and Westshore near the border, and Ridley Terminal just south of Alaska.

Proponents of coal exports warn that if Washington and Oregon pass on the proposed ports, the business will go to Canada instead. That may be, but all indications are that King Coal is willing to fight for an American right of way first: In September, the industry-backed Alliance for Northwest Jobs & Exports spent $866,000 in Oregon and Washington on TV spots lauding the benefits of building coal-export terminals, according to the liberal news site ThinkProgress.

"What I'm hearing from industry heads is that they have a relationship with American shippers," says Mark Northam, director of the University of Wyoming's School of Energy Resources. "They'd prefer to keep working with them if they can."

In 2011, candy magnate Forrest Mars Jr. informed environmental groups in Montana’s Powder River Basin that he’d bought a stake in the proposed Tongue River Railroad. - PHOTO BY CATHRINE L. WALTERS
  • Photo by Cathrine L. Walters
  • In 2011, candy magnate Forrest Mars Jr. informed environmental groups in Montana’s Powder River Basin that he’d bought a stake in the proposed Tongue River Railroad.

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In the American conscience, coal is still an Appalachian concern. That's where miners' wives clutch handkerchiefs on the nightly news awaiting word of coal mine collapses, and where Robert F. Kennedy Jr. gets his boots dirty fighting mountaintop-removal mining.

No doubt, coal is still a major industry in West Virginia, Kentucky and Pennsylvania. But the 1970s weren't kind to eastern U.S. coal. That's because the Clean Air Act of 1970 put stringent controls on how much sulfur coal-fired power plants could emit. Up to then, Wyoming coal hadn't been attractive to utilities, since it didn't burn particularly hot. But it also had low sulfur content, quickly making it the preferred source of cheap energy.

In many ways, the Decker Mine on the Montana/Wyoming border tells the story of coal in America. As Wyoming coal rose to prominence in the 1970s, so did the Decker, named for the tiny Montana town nearby. It became one of the country's biggest surface coal mines, producing 10 million tons a year. But recently, being a microcosm of the coal industry meant layoff announcements just weeks before Thanksgiving.

In November, the Decker's co-owners, Cloud Peak Energy and Ambre Energy, announced plans to lay off 75 of its 160 workers. The town of Decker is so close to Wyoming that its kids are sent to school across the border to Sheridan. Dave Kinskey, Sheridan's Harvard-educated mayor, says the city is hardened to the booms and busts that come with mining. The recession had also stung the city's economy. "The mood already was really somber," Kinskey says, "and that made it all the more so."

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