Jump to: OTTER CREEK COAL TRACTS
Coal exports: The costs to Montana communities
The Otter Creek Valley (Photo by Peter Lesica)
When Arch Coal leased the Otter Creek coal tracts in southeastern Montana, it stated in its March 18, 2010 press release, ”We believe these Northern PRB [Powder River Basin] reserves will help us competitively serve U.S. power producers, supply additional coal for export to emerging Asia or possibly house the site of a future coal-conversion facility.”
Since then, Arch has acquired a 38% interest in Millennium Bulk Terminals-Longview, LLC., the company behind a proposed coal export port in Longview, Washington, created an Asia-Pacific subsidiary, and brokered a deal to export coal out of a British Columbia terminal.
What will this mean for Montanans? It will mean that communities such as Billings and Helena could see 40+ additional trains per day passing through the city. Western Organization of Resource Councils (WORC) has authored an informative white paper on the subject.
For more information:
The Hidden Costs of Coal: Exporting Montana coal to Asia factsheet
The Greenhouse Gas Impact of Exporting Coal from the West Coast, (2011) by Dr. Tom Power, Professor Emeritus, Department of Economics, University of Montana; Power Consulting Inc. www.powereconconsulting.com
Farmers, ranchers have fought coal development for 40 years
Local farmers and ranchers are asked (or told) to pay a heavy price so that an out-of-state mining company can maximize its profit profile. Since much of our membership base is in rural southeastern Montana, many of our members are directly affected by the costs of coal. In the words of Rosebud Creek rancher Clint McRae:
For 40 years, the citizens of southeast Montana have been repeatedly asked to absorb the impacts of natural resource extraction. We have done our part. We have sacrificed the loss of water, land, property, and quality of life for others to enjoy electricity at the flick of a switch.
Coal and other fossil fuel development is based on the practice and principle of externalizing costs, shoving them onto the general public and onto the natural world in the form of pollution, impacts to human health, and destruction of land and water resources. These costs are rarely, if ever, reflected in the price consumers pay. Coal, for example, is a dirty, financially risky fuel of the past filled with substantial hidden costs to society. Every new coal project puts off America’s transition to clean energy and is a step backward at a time when America needs to be reaching for a future of clean and renewable energy sources.
Northern Plains has two responses to the many fossil fuel projects facing Montana. First, we shine a light on the true costs of fossil fuel development so that people, land, and water do not unfairly bear those costs. In some cases, that means changing the way development is approached and ensuring that laws are enforced; in some cases, it means preventing certain developments because they are inherently unjust.
Second, our members understand that making progress to reduce our dependence on fossil fuels also means (1) helping people to understand the practical value of renewables and energy efficiency, and (2) helping people overcome institutional and policy obstacles to increased use of renewables and energy efficiency. Therefore, Northern Plains is promoting opportunities that energy efficiency and renewable energy can offer to rural Montana.
We have significant wind and solar opportunity in Montana. Together with an aggressive energy efficiency program, wind and solar represent a viable alternative to coal in terms of employment opportunities, tax base, and a source of electricity. A recent report prepared for the Civil Society Institute outlines a plan to meet our nation’s energy demands by phasing out coal and increasing energy efficiency and renewable energy sources.
For more information:
The Hidden Costs of Coal: Coal ash factsheet
Otter Creek coal tracts leased without environmental analysis
The Otter Creek coal tracts are minerals given to the State of Montana in the 1990s as part of the federal government’s buyout of the proposed New World gold mine just outside Yellowstone National Park. It is now the site of a proposed coal strip mine, the largest coal mine to have ever been built in Montana.
Inevitably, the mine will directly damage land, water, and wildlife habitat here in Montana. It will necessitate the construction of destructive infrastructure projects that will condemn private property and take agricultural land out of production. Eventually, that coal will be burned, and the company seeking to mine that coal has announced that it will likely be sold to customers in Asia.
The Montana Land Board leased this coal in 2010 without doing an environmental impact statement. The mine is currently the largest new mine being proposed in the U.S. Though it symbolizes a last gasp by the fossil fuel industry, it will be an extremely destructive one. If this coal is developed, the attendant development, including the Tongue River Railroad, would industrialize one of Montana’s most rural places and wreak economic damage across southeastern Montana.
Before the Land Board decided to lease the coal, Northern Plains commissioned an independent economic analysis of the state’s appraisal of Otter Creek coal; that analysis concluded that the state’s appraisal contained numerous failures, inconsistencies, and simple bad math. But the state went ahead and leased for the bargain-basement price of 15¢ per ton.
As surely as a mining permit, the lease is the state’s commitment to see that the Otter Creek coal is mined. It also puts the state in the position of having a financial interest in the mine while it is also responsible for regulating it. The state of Montana has effectively gone into business with Arch Coal, yet the state expects citizens to believe that it will effectively enforce the laws and fulfill its regulatory function on behalf of Montana citizens.
In May 2010, Northern Plains filed a lawsuit against the Montana Land Board for leasing the coal without conducting any environmental analysis. We were joined in that case by the National Wildlife Federation. Northern Plains regards leasing that coal as an irretrievable commitment of resources, and we had made repeated requests of the state to conduct such studies before leasing.
For more information:
Otter Creek coal factsheet (reasons for not leasing the coal)
The Hidden Costs of Coal: Otter Creek coal tracts (impacts of the proposed mine)
Dr. Tom Powers’ report on the economics of leasing the Otter Creek coal tracts
