PacifiCorp and Idaho Power, co-owners of the Jim Bridger power plant and adjacent Bridger Coal Co. (BCC) mining operations in southwest Wyoming, plan to cut BCC production in coming years and take more coal from outside supplier Black Butte Coal.
Cindy Crane, President and CEO of PacifiCorp d/b/a Rocky Mountain Power, described that change in heavily-redacted Nov. 14 testimony filed at the Washington Utilities and Transportation Commission. Notable is that Crane was promoted to those new jobs on Nov. 1, following a stint as head of the utility’s fuel supply department, which includes the owned coal mines like Bridger Coal.
The Bridger plant is fueled by coal supplied by Black Butte and BCC. BCC is a joint venture that mines coal for delivery to the adjacent Bridger plant. PacifiCorp owns a two-thirds interest in BCC, and Idaho Power owns a one-third interest. PacifiCorp and Idaho Power have the same ownership percentages in the Bridger power plant itself.
A projected increase in the delivered price of Black Butte coal is a result of a request for proposals (RFP) for Wyoming coal conducted by the Bridger plant owners in June 2014. The current Black Butte coal supply agreement terminates during the first quarter of 2015.
The Bridger plant owners engaged both Ambre Energy, the operator of the Black Butte mine, and the Union Pacific Railroad in contract negotiations. The terms of the new coal supply arrangement for the Bridger plant reflect a fixed free-on-board (FOB) price for Black Butte coal through 2017. The Jim Bridger plant owners also negotiated new rail rates with the Union Pacific through 2017.
An increase in BCC prices reflects the company’s updated mine plan, which was prepared in July 2014. Under the new mine plan, BCC’s volumes decrease by a redacted amount. The BCC tonnge reduction is primarily associated with updates to BCC’s underground mine plan. The mine plans for both BCC’s surface and underground operations were updated in July 2014. There are three significant factors contributing to decreased underground production in the July 2014 plan:
- Reduction in continuous miner production shifts due to changes in workforce schedules for underground mine employees. The underground mine is now operating two 10-hour shifts, four days per week, compared to two 12-hour shifts, six days per week, in the October 2013 plan.
- A reduction in the amount of coal produced by the longwall system; and
- Shortening of the 15th 14 right longwall panel.
Deep mine has had consistent problems with worker turnover
The underground mine has been unable to maintain two 12-hour shifts, six days per week, due to limited workforce availability. Since its inception early last decade, the BCC underground mine has experienced high turnover rates as underground miners have gained experience and pursued jobs in the trona industry in Southwest Wyoming. The mine has relied heavily on contract mining services, such as Price Mine Service, to supplement the workforce. Despite the contract labor, BCC has been unable to sustain the continuous mining activity that is necessary to support longwall panel development. The revised workforce schedule allows the mine to fully staff two 10-hour shifts, four days per week.
Due to the workforce shortages, Crane added, the mine has been unable to sustain continuous miner development, which is essential to keep from idling the longwall system. The updated production rate allows the underground mine to balance advancement of the longwall system and continuous miner development; the steady rate of longwall production minimizes idling of the longwall and roof stability concerns.
The start-up point for the 15th right longwall panel was moved, shortening the panel length as a result of a fault encountered at the back of the panel and changes to the Bridger Coal underground ventilation plan mandated by the U.S. Mine Safety and Health Administration.
Also in the future, the heat content of BCC deliveries decreases from 9,301 to 9,153 British thermal units (Btus) per pound of coal due to increased ash content of the underground mine. The geological modeling in the July 2014 plan was updated to reflect actual mining conditions in areas where the coal seam height is less than 10 feet. Since the longwall is not capable of mining below 10 feet without cutting the floor or roof, the ash content was increased by approximately 2% in these areas, which contributed to a lower Btu content of coal produced from the underground mine.
Despite these changes, BCC prices remain comparable to Black Butte, Crane said. BCC coal is also less expensive than other Southwest Wyoming coal supply options. As part of its coal RFP in June 2014, the Bridger plant owners sought coal supplies from the other coal mines in Southwest Wyoming—Westmoreland Coal’s Kemmerer mine, which supplies PacifiCorp’s adjacent Naughton power plant, and Kiewit Mining’s Haystack mine.