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Cloud Peak seeks to revive idled Wyo. mine for potential export to Asia

Cloud Peak Energy Inc. is trying to revise its 1977 permit for Youngs Creek, an idle coal mine along the Montana border with the potential to produce up to 1 million tons of coal per year, the Casper (Wyo.) Star Tribune reported May 11.

Deadline for public comment on Cloud Peak's proposed permit revision is set to close May 16. The Wyoming-based company hopes that permitting will be completed in 2018, with the mine potentially producing coal by 2019, the report said.

Cloud Peak is among the few Powder River Basin companies that export coal to Asian markets, by way of a port in Canada. The company has exported coal from its Spring Creek mine in Montana, just across the border from the Youngs Creek site in Wyoming. The company is billing Youngs Creek as part of its Spring Creek mining complex, potentially adding Wyoming coal to its marginal Asian business in 2020 to 2021, the report said.

Montana mines, which are geographically closer to ports, continue to be the Powder River Basin source for Asian-bound coal, the report said, adding that the economics of coal in Wyoming are less than ideal.

The need to find export markets has intensified for producers amid coal-fired plant closures, excess capacity and declining demand in the U.S., the report said.

Demand outside the U.S. does exist, with countries such as South Korea and Japan continuing to make use of the fossil fuel for power generation. Middle Eastern countries such as Iran and Pakistan also continue to add new coal-fired plants, the report said, citing the U.S. Energy Information Administration.

Cloud Peak, which also operates the Cordero Rojo and Antelope mines in Wyoming, bought Youngs Creek Mining Co. from Chevron Corp. in a $300 million deal that included 450 million tons of in-place coal and 38,800 surface acres, the report said.