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WVU: Forecast for state's beleaguered coal industry grim

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WVU: Forecast for state's beleaguered coal industry grim

West Virginia University's latest look at its state's coalforecast paints a grim future for the industry's short- and long-term prospects.

The report is projectingWest Virginia's 2016 production to fall to 68 million tons. That is down from158 million tons in 2008 and 95 million tons in 2015.

The northern part of the state mines in the NorthernAppalachia coal basin while the southern part of the state digs coal from theCentral Appalachia basin. The two regions have been hit by recent marketstruggles in different ways.

"Asrecently as 2011, southern West Virginia mines accounted for more thantwo-thirds of state coal production, but that share fell to roughly half by2015 as southern West Virginia mines produced 59 percent less coal tonnagesince 2008," the report stated. "Northern West Virginia coalproduction increased 16 percent between 2008 and 2015, though mine output hasfallen appreciably over the past few quarters."

Inthe long-term, Central Appalachia is expected to bear the brunt of a decline instate coal production while Northern Appalachia production is projected toremain stable.

"Absentany unexpected improvements over the remainder of the year, total coaltonnage in 2016 could fall to its lowest, non-strike influenced level in nearlya century," said Brian Lego, a research assistantprofessor with West Virginia University's Bureau of Business andEconomic Research in the College of Business and Economics and author of the coalproduction report.

, , andArch Coal Inc. areamong top producersin Northern Appalachia. Top producing minesin Central Appalachia include those owned by Coronado Coal LLC, Arch Coal Inc., the Virginia Conservation Legacy Fund Inc., Alpha andAlliance Resource Partners LP.

Anincrease to 70 million tons during 2017 is expected before production in bothcoal regions will be dragged back down by weak domestic and global marketconditions, the report states. By 2036, the report forecasts, coal productionin the state is expected to contract to below 67 million tons.

Ifthe U.S. EPA's Clean Power Plan, a rule on carbon dioxide emissions, survives legal challenges and isimplemented as proposed, it would push that outlook even weaker to 57 million tons, thereport said.