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US coal mine jobs up slightly in second quarter as production dips

U.S. coal production declined 5.9% from the first quarter of 2017 to the second as employment inched 0.5% higher in the same period.

Average coal mining employment increased by 258 jobs quarter-to-quarter, according to an S&P Global Market Intelligence analysis. After production growth in the last half of 2016, coal production drifted lower in the first half of 2017, though it remained about 14.7% higher than year-ago levels in the first half.

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Employment figures and production are being watched closely for indications of whether President Donald Trump's promise of putting miners "back to work" and turning around coal production trends will pan out.

"We're eliminating the tremendous, the massive restrictions on American energy and numbers are going to be released next week that are going to be earth-shattering as to what we're doing with energy and the amounts of energy we're producing, far greater than ever before," Trump said Aug. 1.

The analysis of U.S. Mine Safety and Health Administration data examines figures reported to MSHA as of July 31. The 544 mines that have reported second-quarter production represent about 99.7% of first-quarter production. The numbers reflect average employment at mines over the quarter as reported by U.S. coal companies.

Total coal production from reporting mines was about 185.7 million tons in the second quarter, down from 197.2 million tons in the prior quarter. The second-quarter production total so far is just shy of the U.S. Energy Information Administration's July prediction that coal production in the second quarter would total 190.2 million tons. The projection estimates that coal production will rise to 206.7 million tons in the third quarter before falling to 191.6 million tons in the fourth quarter.

On Alliance Resource Partners LP's earnings call, CEO Joseph Craft said July temperatures and the forecast for August suggested potential for higher coal production in the second half. Arch Coal Inc. CEO John Eaves said he expects the company's coking coal shipments to increase in the second half of the year as well.

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Powder River Basin coal production accounted for 7.5 million tons of the 11.6 million tons of production decline from the first quarter to the second. The region reported an increase of 37 employees over the period.

Coal jobs were relatively flat in many regions including the Illinois Basin, where average employment increased by just 40, Southern Appalachia, which increased by 79, and the Gulf Coast, where employment fell by 24.

Most of the gains in average coal employment were in Central Appalachia, where 330 coal jobs were added a result of a recent boost in demand for metallurgical coal. Northern Appalachia mines reported 264 fewer coal jobs.

"I know the coal business like the back of my hand and the current spike in the coal market was one I saw coming, and our state legislature refused to listen," West Virginia governor and coal magnate Jim Justice said in a recent news release. Justice, a Democrat, was chastising the Republican-led legislature for not modifying the severance tax in an Aug. 1 email headlined "Jim Was Right: Coal Comeback Edition."

"This is good news but we are not out of the woods just yet because the energy jobs haven't materialized in West Virginia just yet," Justice continued.

Morgantown, W.Va., a city near the Northern Appalachia coal mines, recently considered a resolution to support the Paris Agreement on climate change after Trump withdrew the U.S. from the deal. Chris Hamilton, senior vice president of the West Virginia Coal Association, slammed the move and touted a coal comeback in a July 31 activities update.

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"West Virginia overwhelmingly voted for Donald Trump for president last year, and a big part of that support was predicated on his commitment to help West Virginia's coal industry recover from the devastating attack waged by regulation-happy Washington politicians during the last eight years and return to a position of economic strength," Hamilton wrote.

In the letter, Hamilton insisted that Trump's halting of Obama-era policies has led to "hundreds of miners called back to work."