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Montana coal production slides 23% during 2020

Montana coal production slides 23% during 2020

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Montana coal production dropped 23% last year as demand for coal for U.S. electricity and exports diminished during the pandemic.

The recent disclosure by the U.S. Energy Information Administration put Montana coal production at about 26 million tons. Production nationally was at its lowest level since 1965. The 535 million short tons mined in America in 2020 were less than half the industry’s 2008 high point of 1.17 billion tons.

Montana’s coal struggles in 2020 were obvious. Spring Creek mine, Montana’s biggest coal producer, furloughed 73 employees for four months as the COVID-19 pandemic paused manufacturing in the Midwest. Mine owner Navajo Transitional Energy Company also furloughed 57 workers at its North Antelope mine in Wyoming.

Decker mine, a short walk from Spring Creek, furloughed 98 workers in May 2020 and continued to struggle throughout the year before its parent company, Lighthouse Resources, filed for bankruptcy in December. Decker shut down for good in January.

Montana’s operating coal mines are benefiting from the recovering economy, said Molly Schwend, Montana Coal Council executive director. "There are two fewer mines operating in 2021 than there were last year, but production is similar.”

“In June 2020 we were sitting at 13,221,983. Right now, we’re sitting at 13,179,347,” Schwend said. “What’s interesting is, without Decker, the mines that are operating are up 13%.”

The second non-producing mine this year is Savage mine, which until late March fueled Lewis and Clark Generating Station near Sidney. Lewis and Clark closed as owner Montana Dakota Utilities adapted to electricity from cheaper natural gas and competitive market prices.

Nationally, production gains in 2021 are expected to be modest. U.S. coal production is forecast to increase 15% over last year as U.S. electricity demand increases, reports EIA. Exports are expected to increase 21% over 2020 numbers, though a key export terminal for Montana and Wyoming coal has posted modest expectations for 2021. Westshore Terminals in Vancouver, British Columbia, the only terminal shipping U.S. coal in the Pacific Northwest expected to ship 7 million tons in second quarter of this year, down 600,000 tons from the same period in 2020. Westshore shipped 8 million tons in the first quarter, which was slightly up from the same quarter a year ago. About a third of that coal was thermal coal of the kind mined in the Powder River Basin.

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