MAC: Mines and Communities

Coal mining company backs down in Alaska

Published by MAC on 2017-04-08
Source: Vice, Alaska's Energy Desk

Residents of Tyonek are celebrating

PacRim Coal has been pursuing the Chuitna Coal Project for more than a decade, but the company has been fighting with environmental groups, members of the Tyonek native village and a regulatory process that required permits from several state and federal agencies. Last week, the company told state and federal regulatory agencies that it would no longer pursue permitting on the project.

The Chuitna Coal Project is a surface coal mine to recover an estimated 300 million tons of sub-bituminous ultra low sulfur coal. It is located on the west side of Cook Inlet in the Chuit River Watershed in the Kenai Peninsula Borough of Alaska, approximately 12 miles northwest of the Native Village of Tyonek and 45 miles west of Anchorage.

See also in MAC: 2008-08-11 Coal burned in China means bad air in north America

In Tyonek, celebration as a coal mining company backs down

Residents of the tiny Cook Inlet village of Tyonek are celebrating after news that a company attempting to develop a massive coal mine near their village has shelved the project.

Rashah McChesney

Alaska's Energy Desk -

April 5, 2017

PacRim Coal has been pursuing the Chuitna Coal Project for more than a decade, but the company has been fighting with environmental groups, members of the Tyonek native village and a regulatory process that required permits from several state and federal agencies.

Last week, the company told state and federal regulatory agencies that it would no longer pursue permitting on the project.

Janelle Baker got a text at 7:50 a.m. Monday morning with news that has spread like wildfire through her home village of Tyonek.

“Well, I yelled in joy. Saying ‘yes’ that they finally stopped,” Baker said.

He means PacRim Coal mining company. Baker and many other residents of the village have been fighting a proposed coal mine built on the Chuitna River, about 45 miles southwest of Anchorage and less than 10 miles from her village.

Last week, the company told state and federal regulators that it is shelving the project and won’t move forward with the permit process. State officials said the company told them it was looking for a funding partner, and couldn’t find one.

And the news percolated through the village over the weekend.

Arthur Standifer is the president of Tyonek’s native council. He said he called at least 20 people to share the news.

“What it means for us is our fish will continue to be here for future generations, also our wildlife, like the bears and the moose and the other animals will be secure and they’ll be here. They’ll have a safe place to be,” Standifer said.

The Chuitna coal mine has been in development for decades. The project got its final environmental approval from the Environmental Protection Agency back in 1990, but coal prices crashed and it didn’t move forward.

The project was rekindled in 2006, but it has faced both a long and complex regulatory permitting process through state and federal agencies.  And it faced stiff opposition from tribal members and environmental groups.

But, while the company has shelved the project, a move many in Tyonek consider a win, that doesn’t mean it’s dead.

“If PacRim or another company got access to the leases, it’s possible for them to restart the project,” Russell Kirkham said. He manages the state’s coal regulatory program. “If that was to happen fairly quickly, they could possibly start fairly close to where they are now in terms of the process.”

And, it’s not uncommon for there to be a long lead time in developing projects like this.

Kyle Moselle, a large mine project manager for the Alaska Department of Natural Resources, said that it’s always surprising when a company backs away from a permitting process because it costs a lot of money to make it through.

“Mining of any sort, whether it’s surface mining like a coal project like Chuitna, or load mining …there’s no guarantees and it’s a rigorous review process,” Moselle said.

Back in Tyonek, Arthur Standifer said villagers are cautiously optimistic about PacRim’s decision.

“At this point in time, it’s just a victory for us,” Standifer said. “But we’ll keep an ear to the ground and see what’s going to happen.”

Moselle said he hopes people understand the context and the timeline for a project like PacRim’s and that the state is ready to review any proposal like it that would develop the state’s resources.

A massive coal mining project was scrapped in Alaska after no one would invest in it

Greg Walters

Apr 3, 2017

A controversial coal mining project in Alaska worth more than $600 million has been abandoned by its developers, underscoring the uphill battle President Donald Trump will face in fulfilling his promise to bring coal mining jobs back to America.

PacRim Coal LP, the developer behind the Chuitna Coal Project, was in the later stages of the state and federal mine permitting process to develop coal deposits 45 miles southwest of Anchorage. The firm planned to ship the coal to South Korea, Japan, and China.

But PacRim has suspended all permitting activities and will no longer pursue the project after failing to find an investment partner in the venture, an Alaskan state official confirmed to VICE News.

“As of right now, PacRim is no longer pursuing the project,” said Russell Kirkham, coal regulatory program manager at Alaska’s Division of Mining, Land & Water. “As far as I know, this was a decision from their management. I know they were looking for a partner, and the partner, I don’t think, came through.”

PacRim informed state officials on March 30 that it would no longer pursue the project, Kirkham said. The company did not return a request for comment.

Trump has made restoring America’s fossil fuel industry, and in particular its coal industry, a centerpiece of his economic platform, vowing to repeal regulations his administration says are hurting mining and drilling companies. Just days before PacRim informed Alaska it would no longer pursue Chuitna, Trump lifted a moratorium on coal leases on federal land that had been put in place by President Barack Obama.

“I made them this promise,” Trump said at the signing of the executive order while surrounded by coal miners. “We will put our miners back to work.”

According to PacRim’s website, the project would have created up to 500 jobs during construction and up to 350 jobs during the projected 25-year operating life of the mine. PacRim estimated that coal sales would have generated production royalties in excess of $300 million for the state of Alaska.

But Trump has focused more on mining jobs in places like Pennsylvania and West Virginia than in Alaska. And the Chuitna project, decades in the making, had long been troubled by cost issues and pushback from environmentalists, who said the mine would endanger crucial salmon-breeding waterways.

Still, the fizzling of Chuitna is an excellent illustration of the headwinds facing the coal industry — headwinds that Trump will find difficult to overcome, according to professor Robert Godby, director for Energy Economics & Public Policies at the University of Wyoming.

“Investors are wary, and overall, this is another symptom of the challenges the coal industry faces,” he said. “It’s a reality check. President Trump can’t change market conditions with the stroke of a pen.”

In America, coal is facing a tough challenge from cheaper, cleaner natural gas and from the ever-expanding renewables sector, Godby said. And globally, the Trump administration’s decision to ignore or deny climate change doesn’t change the fact that other countries are fighting it — including the countries where PacRim had hoped to ship their Alaskan coal, Godby said.

“Even if the Trump administration puts a pause on greenhouse gas regulations, that’s not what’s occurring across the world,” Godby said. “South Korea and Japan are signatories to the Paris climate agreement. This is part of wider concerns regarding how we can use coal in the future and be responsible regarding potential climate impacts.”

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