Energy read more

No coal

A massive coal mining project was scrapped in Alaska after no one would invest in it

A massive coal mining project was scrapped in Alaska after no one would invest in it

A controversial coal mining project in Alaska worth more than $600 million has been abandoned by its developers, underscoring the uphill battle President Donald Trump will face in fulfilling his promise to bring coal mining jobs back to America.

PacRim Coal LP, the developer behind the Chuitna Coal Project, was in the later stages of the state and federal mine permitting process to develop coal deposits 45 miles southwest of Anchorage. The firm planned to ship the coal to South Korea, Japan, and China.

But PacRim has suspended all permitting activities and will no longer pursue the project after failing to find an investment partner in the venture, an Alaskan state official confirmed to VICE News.

“As of right now, PacRim is no longer pursuing the project,” said Russell Kirkham, coal regulatory program manager at Alaska’s Division of Mining, Land & Water. “As far as I know, this was a decision from their management. I know they were looking for a partner, and the partner, I don’t think, came through.”

PacRim informed state officials on March 30 that it would no longer pursue the project, Kirkham said. The company did not return a request for comment.

Trump has made restoring America’s fossil fuel industry, and in particular its coal industry, a centerpiece of his economic platform, vowing to repeal regulations his administration says are hurting mining and drilling companies. Just days before PacRim informed Alaska it would no longer pursue Chuitna, Trump lifted a moratorium on coal leases on federal land that had been put in place by President Barack Obama.

“I made them this promise,” Trump said at the signing of the executive order while surrounded by coal miners. “We will put our miners back to work.”

According to PacRim’s website, the project would have created up to 500 jobs during construction and up to 350 jobs during the projected 25-year operating life of the mine. PacRim estimated that coal sales would have generated production royalties in excess of $300 million for the state of Alaska.

But Trump has focused more on mining jobs in places like Pennsylvania and West Virginia than in Alaska. And the Chuitna project, decades in the making, had long been troubled by cost issues and pushback from environmentalists, who said the mine would endanger crucial salmon-breeding waterways.

Still, the fizzling of Chuitna is an excellent illustration of the headwinds facing the coal industry — headwinds that Trump will find difficult to overcome, according to professor Robert Godby, director for Energy Economics & Public Policies at the University of Wyoming.

“Investors are wary, and overall, this is another symptom of the challenges the coal industry faces,” he said. “It’s a reality check. President Trump can’t change market conditions with the stroke of a pen.”

In America, coal is facing a tough challenge from cheaper, cleaner natural gas and from the ever-expanding renewables sector, Godby said. And globally, the Trump administration’s decision to ignore or deny climate change doesn’t change the fact that other countries are fighting it — including the countries where PacRim had hoped to ship their Alaskan coal, Godby said.

“Even if the Trump administration puts a pause on greenhouse gas regulations, that’s not what’s occurring across the world,” Godby said. “South Korea and Japan are signatories to the Paris climate agreement. This is part of wider concerns regarding how we can use coal in the future and be responsible regarding potential climate impacts.”

M-F 7:30PM HBO