Montana is Coal Country
The State of Montana is taking on a catalytic role to bring together developers, industry representatives, and the federal government, while providing permitting facilitation and coal feedstock for technology development, financing, engineering, infrastructure, and product offtake. Montana intends to take advantage of its status as holder of the nation's greatest coal reserves to:
The State Land Board voted in March 2010 to approve the leasing of 570 million tons of state-owned coal located in the Otter Creek Valley of southeastern Montana. The lease provides Arch Coal with the right to develop coal located on state owned land which is interspersed among Arch’s leases of privately owned land containing another 730 million tons of coal. Arch provided the state with an $85.8 million “bonus bid” for the rights to develop the mine. Revenues for the state over the lifetime of the mine are estimated at close to $5 billion. Otter Creek will also require the construction of a rail connection with the BNSF mainline in Miles City, which BNSF engineers estimated construction cost of the Tongue River Railroad to be about $471 million.The Tongue River Railroad which will serve as an access point to Otter Creek coal is now federally permitted. Construction of this line will begin with the development of the Otter Creek coal tracts.
An underground coal mine in Musselshell County, Montana which opened in 2009. The Signal Peak properties are a prime location for multiple coal related development activities. It has an existing permitted operating high quality coal mine located by a U.S. primary highway; has 30 miles of railroad, pipeline and transmission line connections; has completed the needed environmental assessments for an air quality permit for a standard pulverized coal plant which should shorten the time-frame for future permitting.
Exporting Coal and Demand in China
China's increasing demand for coal has made coal imports cost competitive with domestic Chinese coal supply. Coal mine operators in Montana have taken note of this growing market and are ramping up production to meet demand through the exportation of high quality Montana Coal. Several mine sites and Pacific port facilities are under development which will vastly increase the quantity of coal to be exported from Montana to Chinese markets. The shortest United States coal transportation route to Asian markets is from Montana. Railway can easily move it directly to several ports on the pacific coast. In addition, new expanded port development is underway along the Columbia River and elsewhere along the Oregon, Washington, and British Columbia coasts. This will greatly expand the export-ability of coal from the interior west of the United States to Asia where demand for high quality coal is growing. Montana possesses a variety of coal types, all with low sulfur content which can be mined at low cost to meet whatever customer specifications are demanded. In fact, the Powder River Basin coal reserve recently surpassed the eastern Appalachian coal reserve in annual production due to the demand for high quality, low sulfur coal; the type Montana possessess in abundent supply.