[Wildcatk23]

Louisville, Kentucky (Platts)--15Aug2012/448 pm EDT/2048 GMT

Kentucky and West Virginia coal mines will sell 9 million short tons of Central Appalachian steam coal annually to India for 25 years under a $7 billion deal unveiled Wednesday.

A significant portion of the coal will be produced by privately owned Booth Energy, which operates mines in both states, according to Ed Hatfield, president of Cincinnati-based River Trading.

Starting in September, his company will load the coal onto barges at a Big Sandy River dock in eastern Kentucky for shipment to the Gulf of Mexico, where the coal will be placed on oceangoing vessels for the trip to India.

Hatfield said the coal pricing "will be based on market pricing and adjusted."

New Jersey-based FJS Energy LLC signed the long-term coal sales agreement with India's Abhijeet Group. Although India produces coal, domestic production cannot keep up with demand.

Anand Kumar, executive director for Abhijeet, said during a news conference that the partnership "is an example of the strong potential between American producers and Indian customers. We see a significant growth of our mutually rewarding relationship."

Kentucky Governor Steve Beshear, who attended the news conference, termed the deal "a great example of a new market for Kentucky resources."

Beshear, a Democrat, has been a vocal critic of the Obama administration's dealings with the US coal industry.

http://www.platts.com/RSSFeedDetailedNew...al/6563411

[RunItUpTheGut]

What do you expect?
Kardashian has put a halt to every other idea imagined.

Thank God for election day....

[Wildcatk23]

What do you expect?
Kardashian has put a halt to every other idea imagined.

Thank God for election day....

Romney

"We're going to bring jobs back in part by the first step I'm going to take, which is to take advantage of our energy resources," Romney said. "By the way, by the end of my second term, hopefully I get that first and second term, but by the end of my second term I make this commitment. We will have North American energy independence, we won't have to buy oil from Venezuela and the Middle East."

....

[RunItUpTheGut]

^
Lets hope that is true.
Who wouldnt want that?

[TheRealVille]

What do you expect?
Kardashian has put a halt to every other idea imagined.

Thank God for election day....

What do you mean? Booth has a 25 year, 7 billion dollar coal deal, in an Obama administration.

[RunItUpTheGut]

^
Its fine with me that you gloat socialist ideas.
However, its not fine with me that people within our own state wants to see its demise.
Wait, thats kind of the point of socialism, so nevermind.

Take coal, yes, surface mining in particular out, and this country goes to shit worse than it already is. I may be wrong, but thats just my opinion.

[Hoot Gibson]

What do you mean? Booth has a 25 year, 7 billion dollar coal deal, in an Obama administration.

By your estimate, which I take with a grain of salt given the high rate of factually inaccurate information that you have provided about the American coal industry, Booth's company would make between $2 and $4 dollars/ton on that contract - a profit margin of somewhere between 3 and 8 percent. Given that the Obama administration has declared war on coal and seems to be winning, Booth's contract does not sound all that lucrative.

All it takes to bankrupt a coal company is for the EPA to change its enforcement policies and team with the anti-coal zealots to use the federal courts to do Obama's dirty work. I doubt that Jim Booth is giving any credit to Obama for the contract that he negotiated. If Romney is elected, good times are ahead for the coal industry.

[Bob Seger]

By your estimate, which I take with a grain of salt given the high rate of factually inaccurate information that you have provided about the American coal industry, Booth's company would make between $2 and $4 dollars/ton on that contract - a profit margin of somewhere between 3 and 8 percent. Given that the Obama administration has declared war on coal and seems to be winning, Booth's contract does not sound all that lucrative.

All it takes to bankrupt a coal company is for the EPA to change its enforcement policies and team with the anti-coal zealots to use the federal courts to do Obama's dirty work. I doubt that Jim Booth is giving any credit to Obama for the contract that he negotiated. If Romney is elected, good times are ahead for the coal industry.

But here's what I would bet the farm on:

If, Obama were to campaign through the coal fields, his campaign rhetoric would include phrases such as "I made this happen", "I worked out this deal with India....." "My polocies are working and it's keeping all of you miner's working".....yada yada yada

Obama , would someway, somehow try to find a way make others believe he is the reason for the deal.


Any takers on the wager?

[TheRealVille]

By your estimate, which I take with a grain of salt given the high rate of factually inaccurate information that you have provided about the American coal industry, Booth's company would make between $2 and $4 dollars/ton on that contract - a profit margin of somewhere between 3 and 8 percent. Given that the Obama administration has declared war on coal and seems to be winning, Booth's contract does not sound all that lucrative.

All it takes to bankrupt a coal company is for the EPA to change its enforcement policies and team with the anti-coal zealots to use the federal courts to do Obama's dirty work. I doubt that Jim Booth is giving any credit to Obama for the contract that he negotiated. If Romney is elected, good times are ahead for the coal industry.

See post #1.

[Hoot Gibson]

See post #1.

See post #2 of the "obama's war on Coal," in which you provided an economic analysis of Booth's deal with India. I assume that you are at least as knowledgeable about the economics of mining and selling coal as you are about the high sulfur content of coal reserves being mined in the western United States. Hence, my "grain of salt" comment.

The information that you provide often does not hold up to close scrutiny. Taking the "facts" that you present as the basis for discussion is a risky proposition. You have no idea what Jim Booth's mining costs are and you have no idea what sort of profit margin he expects and neither do I. The difference is I do not claim to know the unknowable. nicker:

[Hoot Gibson]

But here's what I would bet the farm on:

If, Obama were to campaign through the coal fields, his campaign rhetoric would include phrases such as "I made this happen", "I worked out this deal with India....." "My polocies are working and it's keeping all of you miner's working".....yada yada yada

Obama , would someway, somehow try to find a way make others believe he is the reason for the deal.


Any takers on the wager?

I don't think that Obama will be campaigning anywhere near the eastern coalfields. I also would not be surprised if Obama's campaign tries to take credit for Jim Booth's deal to sell coal to India.

Obama has already tried to claim credit for increased gas production in this country, despite the fact that the increase has come from new wells operating on privately owned lands.

In a sane world, people living in areas like eastern Kentucky and southern West Virginia would boycott Democratic candidates until they agree to end their war on coal. But Democrats being Democrats, they will continue to elect Democrats to office, even as Obama continues to wage the war that he declared on coal as a candidate in the 2008 campaign.

[TheRealVille]

See post #2 of the "obama's war on Coal," in which you provided an economic analysis of Booth's deal with India. I assume that you are at least as knowledgeable about the economics of mining and selling coal as you are about the high sulfur content of coal reserves being mined in the western United States. Hence, my "grain of salt" comment.

The information that you provide often does not hold up to close scrutiny. Taking the "facts" that you present as the basis for discussion is a risky proposition. You have no idea what Jim Booth's mining costs are and you have no idea what sort of profit margin he expects and neither do I. The difference is I do not claim to know the unknowable. nicker:

My only claim of knowledge of what it cost to mine coal, and what it sells for, is information that a coal miner tells me. A miner friend of mine, higher up in the office of the company he works for told me it cost 58-60 dollars a ton/average to mine a ton of coal, and he said it sells for an average of 56(of course that was several months ago), if you have any new info on what coal sells for a ton, feel free to share.


Edit: I'll help you out Hooter.
http://www.eia.gov/coal/news_markets/

[Old School]

Production cost vary from company to company and within the company from mine to mine, production cost can also vary from month to month at each mine.

[TheRealVille]

Production cost vary from company to company and within the company from mine to mine, production cost can also vary from month to month at each mine.

That's why I said "average".

[Hoot Gibson]

That's why I said "average".

Companies don't make decisions based on the "average" cost of mining a ton of coal - they base decisions on their actual costs. Mining costs are different for every coal mine in the country because mining plans and equipment choices are dictated by geology. Jim Booth has been one of the most efficient coal operators in the industry since he began mining as a contractor at Island Creek's Pevler complex back in the 1970s. I doubt that he signed the Indian contract expecting to make only $2/ton. With a potential Obama second term, that would be crazy.

Another thing that you and your left wing environmental wacko friends always fail to acknowledge is that companies do not always have a choice to either mine coal by surface or underground methods. Geology, previous mining conditions (existing undergrounds above and/or below a coal seam), surface conditions, and other variables determine the best - and often the only feasible mining method for a given seam of coal. Deep mining coal when it can be economically surface mined wastes a valuable natural resource.

Aside from long wall mining, which is generally not practical in eastern Kentucky, underground mine recovery rates are much lower than those for surface mines. Owners of coal reserves and the surface affected by mining do not approve wasting coal reserves because it results in less income for them. Most coal companies do not own the coal that they mine. They pay royalties for mining coal, wheelage fees for transporting coal across other people's properties, and surface disturbance/portal fees.

As I said, neither one of us has a clue about how much Booth stands to make from his new contract. I don't claim to know.

[vector]

Companies don't make decisions based on the "average" cost of mining a ton of coal - they base decisions on their actual costs. Mining costs are different for every coal mine in the country because mining plans and equipment choices are dictated by geology. Jim Booth has been one of the most efficient coal operators in the industry since he began mining as a contractor at Island Creek's Pevler complex back in the 1970s. I doubt that he signed the Indian contract expecting to make only $2/ton. With a potential Obama second term, that would be crazy.

Another thing that you and your left wing environmental wacko friends always fail to acknowledge is that companies do not always have a choice to either mine coal by surface or underground methods. Geology, previous mining conditions (existing undergrounds above and/or below a coal seam), surface conditions, and other variables determine the best - and often the only feasible mining method for a given seam of coal. Deep mining coal when it can be economically surface mined wastes a valuable natural resource.

Aside from long wall mining, which is generally not practical in eastern Kentucky, underground mine recovery rates are much lower than those for surface mines. Owners of coal reserves and the surface affected by mining do not approve wasting coal reserves because it results in less income for them. Most coal companies do not own the coal that they mine. They pay royalties for mining coal, wheelage fees for transporting coal across other people's properties, and surface disturbance/portal fees.

As I said, neither one of us has a clue about how much Booth stands to make from his new contract. I don't claim to know.

i can't believe we finaly have found something you don't KNOW:biglmao:

[Old School]

About three years ago Gene Kitts of ICG wrote this article explaining why do we surface mine. This article was posted on the Coal Tattoo by Ken Ward, to help his readers understand surface mining, in case you are not familar with the Coal Tattoo it is a very anti-mining blog. The article is well worth reading and may answer some questions you have about surface mining.

http://blogs.wvgazette.com/coaltattoo/20...face-mine/

[Old School]

That's why I said "average".

I know you did. That comment was not directed at you, if it were I would have quoted your post.

My comment was made in general and for anyone who was interested.

[Hoot Gibson]

i can't believe we finaly have found something you don't KNOW:biglmao:

It sure does not take long to find something that you don't know. You reveal something new with every post. :biggrin:

[TheRealVille]

Companies don't make decisions based on the "average" cost of mining a ton of coal - they base decisions on their actual costs. Mining costs are different for every coal mine in the country because mining plans and equipment choices are dictated by geology. Jim Booth has been one of the most efficient coal operators in the industry since he began mining as a contractor at Island Creek's Pevler complex back in the 1970s. I doubt that he signed the Indian contract expecting to make only $2/ton. With a potential Obama second term, that would be crazy.

Another thing that you and your left wing environmental wacko friends always fail to acknowledge is that companies do not always have a choice to either mine coal by surface or underground methods. Geology, previous mining conditions (existing undergrounds above and/or below a coal seam), surface conditions, and other variables determine the best - and often the only feasible mining method for a given seam of coal. Deep mining coal when it can be economically surface mined wastes a valuable natural resource.

Aside from long wall mining, which is generally not practical in eastern Kentucky, underground mine recovery rates are much lower than those for surface mines. Owners of coal reserves and the surface affected by mining do not approve wasting coal reserves because it results in less income for them. Most coal companies do not own the coal that they mine. They pay royalties for mining coal, wheelage fees for transporting coal across other people's properties, and surface disturbance/portal fees.

As I said, neither one of us has a clue about how much Booth stands to make from his new contract. I don't claim to know.

I didn't come up with the 7 billion figure, somebody else did. I don't know where it came from.

[Hoot Gibson]

I didn't come up with the 7 billion figure, somebody else did. I don't know where it came from.

Understood. The deal is great news for eastern Kentucky. India needs lots of new generating capacity. Power outages are common in the summer, even if India's prosperous states. My Indian carpool partner says that it is partly because of the country's reliance on hydroelectric power plants. Demand for electricity goes up during the hot, dry season and the water levels drop. The country does not have enough thermal power plants to make up the difference, so it resorts to rolling blackouts.

If I had money to invest, coal would be among the last places that I would invest it in the current political climate. I hope that Jim Booth and his employees profit from this contract for many years but it seems like a roll of the dice to me. Obama's efforts to destroy the domestic market for coal will also increase costs for companies that export coal.

[TheRealThing]

But here's what I would bet the farm on:

If, Obama were to campaign through the coal fields, his campaign rhetoric would include phrases such as "I made this happen", "I worked out this deal with India....." "My polocies are working and it's keeping all of you miner's working".....yada yada yada

Obama , would someway, somehow try to find a way make others believe he is the reason for the deal.


Any takers on the wager?

No, you got it right. If it happens on his watch and it's good then, his policies and leadership made that happen. Of course, anything and I mean anything, that happens and is bad, it's George W's fault. It's kindergarten time at the white house.