The fastest-growing coal-producing region in the USA – by John Chadwick (Publisher/International Mining – June 2013)

http://www.im-mining.com/

While coal in the USA is generally a story of falling output, the Illinois Basin – which covers southern Illinois, Indiana and west Kentucky – is bucking that trend. Production across the nation fell 7% in 2012, compared with 2011, with the biggest falls in Wyoming’s Powder River Basin (PRB), and Central Appalachia; but Illinois Basin output was up 10%.

It is this coal’s high sulphur content that resulted in it being largely ignored over recent years, in favour of coal that is more expensive to mine in fields to the east.

However, with power generators equipping facilities with scrubbers that sulphur content is no longer a problem. And producers can save money from Illinois Basin coal that costs something like half that of Central Appalachia to produce.

Characterised by high BTU, mid-range sulphur, moderate ash and low moisture content coal, 2012 output declined an estimated 63.5 Mt, led by an 18% decrease in Central Appalachia. PRB production declined 8%, while the Illinois Basin
rose 11%.

According to the USGS, the area of coalbearing rocks in the Illinois Basin comprises 95,312 km2 in Illinois, 16,835 km2 in southwest Indiana, and 16,576 km2 in western Kentucky.

The USGS estimated in 2002 (by no means all mineable resources) “identified remaining resources for the Springfield Coal” in coal greater than 1.07 m thick and at depths less than 45.7 m “(potentially mineable at the surface),” are about 5,170 Mt; for the Herrin Coal, 5,714 Mt; and for the DanvilleBaker Coals, 1,270 Mt. Identified remaining resources for the Springfield Coal in coal greater than that thickness and at greater depths are about 54,426 Mt; for the Herrin Coal, 56,603 Mt; and for the Danville-Baker Coals, 8,345 Mt.

So far this year, US coal power generation has risen 8%, with a similar fall in natural gas use. Energy Ventures Analysis expects US production of some 889 Mt this year, down from some 1,000 Mt in 2011. But in the Illinois Basin the projections are for output of 51 Mt, up hugely from just over 30 Mt in 2010.

In late 2012, the US Energy InformationAdministration commented that “domestic utilities that have added scrubbers can burn highsulphur coal while remaining in compliance with recent requirements to reduce sulphur dioxide emissions. Because of the relatively low cost of Illinois Basin coal and its use in larger, efficient plants with modern pollution control equipment, its producers were less affected by recent low natural gas prices.”

Peabody Energy is the leading producer in the Midwest, shipping about 27 Mt/y of coal from Illinois and Indiana mines to electricity generators and industrial customers throughout the region. It operates multiple underground and surface mines throughout the Illinois Basin.

Opened in 2010, Peabody’s Bear Run mine in Sullivan County, Indiana, will be the largest surface mine in the eastern US, with a 7.25 Mt/y annual production capacity. The mine uses a combination of draglines, trucks and shovel, and dozer push to remove overburden and mine coal from the Indiana No. 7, No. 6, No. 5A and No. 5 seams. In the preparation plant, the coal is crushed, processed and blended before being transported by train and truck to the utilities.

Also in Indiana there are the underground Francisco mine in Gibson County and the surface Viking mine in Davies County. The Somerville mine complex in Gibson County consists of three surface mines: Somerville North, Somerville South and Somerville Central. The company commissioned the new Wild Boar mine, a surface operation, in Lynnville, in late 2010. In 2012, Wild Boar produced some 1.8 Mt of thermal/steam coal.

In Illinois, Peabody operates the underground Gateway mine near Coulterville, as well as the surface Cottage Grove mine and the underground Wildcat Hills mine in Gallatin and Saline counties.

Patriot Coal’s Illinois Basin operations include two mining complexes in western Kentucky. Dodge Hill No. 1 and Highland No. 9 are underground mines using continuous mining methods.

Knight Hawk Coal was born in April 1997, when others were pulling out of the basin. What started as a 15-man operation extracting some 240,000 t/y of coal now send about 3.3 Mt of coal to market, from operations such as its Prairie Eagle and Hawkeye mines. In August 2006, Arch Coal acquired a third interest in Knight Hawk in exchange for cash and coal reserves.

Other recent new mines/companies include Hillsboro Energy’s Deer Run, one of the largest longwall operations Illinois has seen; Lively Grove (Prairie State Generating Co), M Class Mining’s MC No. 1, Blackhawk Mining, formed in 2010; and
Eagle River Coal established in 2009.

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