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MiningWeek Online
May 21, 2004 Volume 10, Issue 20
This Week's Issue:
NMA: Poor data flaws EPA’s proposals for controlling mercury emissions
The poor quality of the Environmental Protection Agency’s (EPA) emissions data, drawn from only “a limited number of coal types and operating conditions,” has led the agency to propose standards that would prevent existing and new power plants from utilizing substantial portions of the nation’s coal reserves that now generate more than half of the nation’s electricity, NMA said this week in comments to the agency.
“In the absence of adequate emissions data for the wide variety of U.S. coal types and power plants, and without demonstrated technologies for reducing mercury emissions, EPA cannot implement an effective MACT rule for power plants, nor set accurate emissions allowances for a cap-and-trade program,” said NMA President and CEO Jack Gerard. Approximately 1,623 power units nationwide currently rely on coal for electricity generation.
A thorough study of EPA’s data conducted for NMA by AEMS LLP, an independent consulting firm, provides persuasive evidence that the agency’s statistical analysis, sampling, and methodology are inadequate for determining mercury reduction values for any coal type and for setting emissions limits and allowances.
“EPA’s data represents at best only a partial snapshot of the industry,” explained Gerard. “We don’t think it’s wise to base decisions that will have far-reaching economic implications on inadequate data that reflect neither the differences among coal types nor the differences among power plant operations,” he said.
NMA proposed a modification of EPA’s cap-and-trade proposal that would allow for greater certainty in setting achievable emissions reductions. Under this proposal, hard data from actual mercury reductions achieved under EPA’s new interstate air quality rule would lead to a fairer allocation of emissions allowances for coal types, allow for a more thorough assessment of mercury abatement technologies commercially available, and form the basis of interim emissions allowances in 2015.
New units should not be forced to rely on purchased credits alone for meeting emissions targets, advised NMA, but should be granted modest allowances to minimize the possibility that power plants would switch to more costly fuels and raise energy costs further.
NMA also suggested that banking of emissions credits be deferred until 2015. This later date would better ensure that target reductions in 2018 would be achieved without heavy use of credits banked throughout the longer, eight-year period proposed by EPA.
NMA commented on behalf of the U.S. coal industry that generates 52 percent of the nation’s electricity.
For NMA’s complete comments, see www.nma.org/policy/regulatory.asp.
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Global demand for silver rises nearly 11 percent in 2003, reversing two-year decline, SI says
Silver fabrication demand shot upwards in 2003 to 859.2 million ounces (Moz), and the 13.3 Moz gain over 2002 “represents the partial reversal of a two-year decline in demand,” according to the Silver Institute’s (SI) “World Silver Survey 2004.”
Silver’s use in industrial applications experienced an increase of nearly 3 percent, to 351.2 Moz, the report said. “The main driver for the growth in industrial applications was an improving global economic environment, a resurgent electronics sector, and the dramatic 8 percent increase in Chinese fabrication, which last year consumed a record 27.6 Moz of silver in industrial applications in that country.”
SI said for the 15th consecutive year, “a structural deficit was recorded. This gap between fabrication demand and conventional supply (mine production and recycled scrap) stood at 72 Moz in 2003. Moreover, the average silver price was $4.88 per ounce – a 6 percent increase over 2002. Much stronger investment interest and the improved fabrication demand scenario, which picked up strongly from the third quarter onwards, propelled the silver price to $5.96 per ounce at year’s end.” SI said the price spike has continued into 2004, with the average cumulative price hitting $6.77 per ounce through April 2004.
In terms of major commodity categories, SI noted the following:
- Jewelry and silverware consumption “was particularly robust in 2003, and can be cited as a key reason for the increase in silver offtake.” Jewelry offtake staged an impressive turnaround, growing by 4.1 percent to 276.7 Moz. Silver use in coins and medals rose considerably to a nine-year high.
- A combination of the Iraq war, lower economic growth in certain regions, the SARS virus, corporate decisions and inroads by digital photography led to lower demand for silver-bearing photographic products in 2003.
- Global silver mine production declined for the second consecutive year to 595.6 Moz. “This was mainly due to lower volumes of by-product silver generated at lead-zinc and gold mines.”
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Cranford: Minerals policy, energy bill important agenda items for House Energy and Mineral Resources panel
Both minerals policy and passage of an energy bill are important agenda items for the House Resources Energy and Mineral Resources Subcommittee, the panel’s new staff director told NMA’s Government Affairs Committee this week.
“We are looking for ways to reach out and get a broad range of support” for both issues, Jay Cranford said. He said it was particularly important for mining companies to make members aware of how their operations have a multiplier effect throughout the economy, and in many areas where mining activity itself may not take place. NMA President and CEO Jack N. Gerard noted that NMA’s ACT Online grassroots program and Mine the Vote campaign (see separate story) are ultimately aimed at helping achieve this effect.
Cranford noted the House may have an “Energy Week” in June, and that the House panel is “looking forward to getting the energy debate back on the radar screen.” He said the panel is also in discussions regarding a potential mercury hearing. He also praised NMA for having a visible and effective Washington presence – “it’s so important,” he said.
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Capito, Reynolds visit NMA
Reps. Shelley Moore Capito (R-WV) and Tom Reynolds (R-NY).
Reps. Shelley Moore Capito (R-WV) and Tom Reynolds (R-NY) visited NMA this week to brief staff and member company representatives on 2004 election prospects. Talking about West Virginia, Capito said her state is a “big time battleground. There’s going to be a huge grassroots push to get our vote out. Every vote is going to count.” Reynolds, who is chairman of the National Republican Congressional Committee (NRCC), praised Capito as having “done a superb job as a congresswoman,” and for her leadership on the health care issue in particular.
Capito serves on the House Financial Services Committee, the House Transportation and Infrastructure Committee and the House Small Business Committee. She also serves as the Republican Co-Chairwoman of the Congressional Women’s Caucus and as a member of the Congressional Steel Caucus. NMA President and CEO Jack N. Gerard praised Capito for her strong support of the mining industry.
As NRCC Chairman, Reynolds is one of only eight elected House GOP leaders who serves, and he is responsible for recruitment and fundraising for Republican candidates running for the House of Representatives. He also serves as a member of the House Rules Committee, the House Administration Committee, and as a deputy majority whip.
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Murkowski visits NMA
Sen. Lisa Murkowski (R-AK) attended an event at NMA headquarters this week. Murkowski is running for reelection for her Senate seat.
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District court denies mining industry request to modify 2001 injunction
The U.S. District Court for Colorado this week denied a request by NMA and the Colorado Mining Association (CMA) to modify its 2001 injunction in the NMA v. Browner case. The associations in January 2004 had asked the court to make clear to the Environmental Protection Agency (EPA) that it cannot require metal and coal mining facilities to report on naturally-occurring Toxic Release Inventory (TRI) chemicals in the ores and minerals the facilities extract and beneficiate.
The order by Judge Edward Nottingham essentially ruled that NMA did not meet the stringent standard under Federal Rules of Civil Procedure for extraordinary relief to modify injunction and that an agency reinterpreting its rules is not an exceptional or extraordinary circumstance.
In addition, the court ruled that anyone injured by the agency’s course of action has adequate recourse to seek judicial review in a new action; agencies are allowed to issue policy statements and interpretations of the law without going through notice and comment rulemaking (these types of actions, however, are different than legislative rules requiring notice and comment rulemaking); and that letters in which EPA had argued the self-implementing nature of the Emergency Planning and Community Right to Know Act (EPCRA) do not conflict directly with the statute.
Over 85 percent of the volume of all materials reported by mining operations as part of the TRI program is naturally occurring metals that remain in low concentrations in the materials handled and managed on land at the mine site.
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Congressional Waterways Caucus formed
House Republican Conference Secretary John T. Doolittle (R-CA) and Reps. Kenny Hulshof (R-MO), Mike McIntyre (D-NC) and Gene Taylor (D-MS) this week announced the formation of a new Congressional Waterways Caucus.
The purpose of the group is to “create a voice within Congress on the issues facing our nation’s waterways; identify ways to effectively work together to highlight the importance of waterways; and examine legislative and regulatory solutions to the challenges facing navigable waterways and rivers,” a press statement said.
The group currently has 54 members. Doolittle, Hulshof, McIntyre and Taylor serve as co-chairs.
Sen. Pete Domenici (R-NM) said he expects the caucus to bring “needed attention to the looming backlog of work to maintain and improve America’s waterways and infrastructure.”
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NMA signs on as tournament presenting sponsor for Pete Dye West Virginia Classic
NMA has agreed to partner with the Pete Dye West Virginia Classic and will become a tournament presenting sponsor for the event at the Pete Dye Golf Club in Bridgeport, WV, July 12-18.
“We are proud to be associated with this important sporting event, and excited about the positive image of coal mining that holding the tournament on reclaimed mined land will convey,” said Carol Raulston, NMA senior vice president-communications. “We believe the course reinforces the integral role of reclamation in modern mining and the economic opportunities reclaimed mine lands are providing throughout West Virginia.”
Aside from its outstanding reclamation, the 250-acre Pete Dye is a unique course with a coal mine theme, and reflects a true integration of the game and the environment. The tee markers are from the coal railroad. After finishing hole #6, golfers take a trip through a 140-foot coal mine, which is underground, to hole #7’s tee box. Hole #10 has coal-filled hopper cars down the left side of its fairway. Various additional mining paraphernalia is used throughout its design, and waterfalls originate from deep mining activity of days gone by.
“Golf Digest” rated Pete Dye as the 3rd “Best New Private Course” in America for 1995, and ranked it as #1 “Best in State” for 1997-98. “GOLFWEEK” chose it 2nd in the category of “America’s 100 Best Modern Courses” for 1998 and 1999, and 4th in 1997. “GOLF Magazine” chose the course 76th among the “Top 100 Courses in the U.S.” for 1997 and 73rd in 1999. Pete Dye has described the course as “18 of the most exciting and memorable holes I have ever built,” and added, “there isn’t anything more dramatic than this piece of property.”
The Pete Dye West Virginia Classic is a three-year event. The Golf Channel is the exclusive broadcast partner of the PGA Nationwide Tour and will telecast the weeklong activities. The $600,000 purse is the second highest regular season amount on the Nationwide Tour.
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‘Mine the Vote’ makes it easy to communicate with your employees during the election season
The general election is less than six months away – have you communicated with your employees about the importance of their vote?
If not, NMA’s “Mine the Vote” campaign makes it easy, and the association encourages mining community management to take advantage of this effective and easy-to-use tool early and often.
The fact is, post-election surveys consistently show that employees prefer, by significant margins, to receive election-related information from their employers – over unions, television or other news sources. And it’s legal; under federal election laws, there is no limit on the amount of company resources (non-PAC) you can devote to the key areas of voter registration, absentee ballots and get-out-the-vote drives, as long as the activities are not specific to a candidate or party.
Why are these activities important? In the 2000 Presidential election, only about 50 percent of registered voters participated. The last two elections (2000 and 2002) were the closest in the nation’s history. Mining states have played a crucial role in the outcome of recent elections and experts expect the same to happen in 2004.
The Mine the Vote 2004 website provides all of the information necessary for your company to appropriately educate your employees. Among the features are register to vote and absentee ballot information; top mining issues; presidential voter guide; how your legislator voted on mining issues; and general election information. NMA members can also access a company election toolkit.
In short, there is everything needed to initiate meaningful and effective communication with your employees about the upcoming election, as well as encourage their participation. If you haven’t already, take advantage of this exceptional tool today by visiting www.minethevote.org.
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Phelps Dodge commemorates 75 years on the NY Stock Exchange May 24
Phelps Dodge Corp. will mark 75 years on the New York Stock Exchange (NYSE) on Monday, May 24, when three employees from the company’s Morenci facility will ring the closing bell at the Big Board.
Only 86 companies of the 2,760 listed on the NYSE have an original date earlier than Phelps Dodge’s May 24, 1929 listing. The company, based in Phoenix, AZ, has been in existence since 1834, and now has operations in 27 countries.
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Lakes coal trade up nearly 16 percent in April
Lakes coal trade up nearly 16 percent in April
Shipments of coal from U.S. and Canadian Great Lakes ports totaled 3.9 million net tons in April, an increase of 15.6 percent compared to a year ago, according to the Lake Carriers Association (LCA).
The increase largely reflects better sailing conditions this April, LCA said. “The harsh winter of 2002/2003 slowed the resumption of all dry-bulk trades. Compared to the month’s 5-year average, this April is up only marginally.”
For the year, the Lakes coal trade stands at 6.6 million tons, an increase of more than 2 million tons compared to the same point in 2003 and 330,000 tons ahead of the 5-year average for the January-April timeframe. The strongest gains have come in shipments of western coal from Superior, Wisconsin, Thunder Bay, Ontario, and South Chicago. “The eastern coal trade out of Lake Erie ports, while up 300,000 tons compared to ice-impacted 2003, is significantly behind its 5-year average,” LCA said.
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Emergency repairs scheduled for McAlpine locks and dam
The 1,200-foot lock at McAlpine Locks and Dam (Ohio River, Mile 606.8) will be closed for emergency repairs Aug. 3-16, 2004, to prevent failure of a miter gate. With only one lock chamber at McAlpine, this means a total river closure for those 14 days.
Recent inspections have revealed cracks which, if not repaired, could lead to a miter gate failure. Inspections will be held every two weeks beginning the week of May 27.
NMA is interested in evaluating the impact the closure will have on member companies. Those affected should contact Moya Phelleps at 202-463-2639, or mphelleps@nma.org, with the product that is shipped through this lock, as well as the approximate tonnage and value.
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Newsbits
Apollo Gold Corp. said it has received the necessary operating permits for the Standard Gold Mine, located five miles south of the company’s Florida Canyon Mine near Winnemucca, NV. The facility will be an oxide gold, open-pit heap-leach operation, and development of roads, pad construction, installation of power and other infrastructure will begin immediately, with some ore placement scheduled for later in the third quarter of this year, Apollo Gold said. Capital costs to bring the mine into operation is $7.5 million, the company said . . . . Mark N. Schroeder has been named vice president of materials management for Peabody Energy. In addition, Robert L. Reilly has been named vice president of corporate development for the company . . . . P&H MinePro Services said it has an order for a second P&H 2800XPB shovel at Cleveland-Cliffs Inc.’s Hibbing Taconite mine in Minnesota. The new shovel will be equipped with a 35-cubic yard dipper to load the mine’s 240-ton haul trucks; commissioning is scheduled for late July 2004.
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