Colorado coal: boom yields four straight record years and $80,000 miners.

• Author: Buchsbaum, Lee

Just above the Family Dollar Store's illuminated sign on the west edge of Craig, you can see the lights of draglines at the Trapper Mine working high above town--their massive booms rotating back and forth in a perpetual dance. The metaphor is inescapable: For more than a century now many a family's dollar has been earned by digging coal from mines bordering town. As you watch in the evening amid the falling snow, you realize that those machines on the hill symbolize the heart and history of this community--and the future of northwestern Colorado as well.

Back in Denver, Stuart Sanderson, president of the Colorado Mining Association, is beaming. "Colorado coal is a huge success story," says Sanderson. "2004 was our fourth record year in a row. The state's 12 mines extracted 40.1 million tons of coal worth over $1 billion."

Up 13 percent from 2003, that tonnage makes Colorado the sixth highest producing state in the nation, Sanderson said. "With the expansion that's planned, we may be moving up to fifth next year, overtaking Texas," he added.

According to the Mining Association, Colorado's 2,100 miners are the state's highest paid industrial workers, earning an average of $80,000 a year in combined salary and benefits. "More growth translates into more lucrative jobs in those coal-producing regions," said Sanderson, "and more tax revenue for all of us."

Together, payroll, taxes and royalties from coal generate almost $680 million in economic benefits statewide. The industry's turnaround has come after years of retrenchment and stagnation. From a high of nearly 50 mines operating in the '80s, fewer than a dozen were still producing one decade later. Since that nadir, however, production began to climb dramatically. Years 1997 through 1999 saw record output. Finally in 2001, Colorado's mines broke the 30 million ton barrier--setting another record. 2002's production climbed to 35.3 million; 2003's numbers were slightly higher at just under 36 million tons. "Since '99, we've seen an almost 30 percent increase in coal production," said Sanderson, "and 40 million tons is not our ceiling."

To meet growing demands, several mines have announced plans to increase production, although none so dramatically as Peabody Energy Corp.'s Twentymile Mine in Routt County. Already the largest coal mine in the state, extracting 8.6 million tons last year, using newer technology, more workers and equipment, Peabody is investing capital to ramp up production at Twentymile so that, according to corporate spokesperson Beth Sutton, the mine has "the ability to reach the 12 million ton-per-year production level over the next three years, presuming that customer contracts are in place and market conditions remain favorable."

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WHY COLORADO COAL?

America's coal reserves contain roughly the combined energy equivalent of Saudi Arabian, Kuwaiti and Iraqi oil. Because of its vast supply and low cost per ton, coal generates more than 54 percent of the nation's electricity. Fully 80 percent of Colorado's electricity is derived from coal. The state's reserves, 16 billion tons of coal, rank it eighth among all the 50 states. Its largest mining operations are located in two Western Slope regions: The North Fork Valley east of Delta near Paonia; and the Yampa River Valley between Craig and Hayden. And Colorado coal's high value comes from its super-compliance with environmental standards (when burned it exceeds the standards set by the EPA and other regulatory agencies) and its comparatively greater heating and energy properties.

In the U.S., the highest quality deposits are found in three distinct regions: Appalachia, the Midwest, and the Intermountain West (Wyoming is the nation's production leader, mining 380 million tons last year). Like most Western coal, Colorado's burns very cleanly, releasing...