Coal Fuels Brewpubs in Wyoming as Kentucky Mines Misery – by Mark Drajem (Bloomberg News – July 18, 2014)

Trying to find the boom in U.S. coal? Stop in the Gillette Brewing Company in Wyoming, which 38-year-old Tom Gorton opened using some of the $70,000 a year he earns mining coal.

“Things were iffy there for a little bit, but it’s picking up now,” Gorton said at his brewery in the center of town, where customers wash down brie baked in a wood-fired oven with gluten-free blue agave ale. “When people have a little extra money, that changes things.”

In the coal region of eastern Kentucky, about 1,300 miles away, extra money is hard to come by. Brandon Farley lost his job there when the James River Coal Co. (JRCCQ) mine closed. Months of looking turned up only one job lead: a minimum wage opportunity at the local Pizza Hut.

“They want coal to be done with,” Farley said. “I believe it’s coming to an end.”

The experience of these two mining communities reflect the conflicting views of coal itself. Environmentalists see signs of its demise in shrinking production and growing concerns over global warming. Boosters point to a surge in demand by developing countries hungry for cheap and plentiful energy. Germany and Japan, too, are burning more coal as they reconsider the risks of atomic power.

Boom, Bust

Evidence is similarly contradictory in towns across the U.S., where the changing fortunes of coal can swing a community from boom to bust and back.

“It depends on where you are standing as to what is going on,” Jeff Archibald, a specialist on coal at the consulting firm ICF International (ICFI), said in an interview. In Wyoming, “production is going to come back to the highs we saw a few years ago,” while in central Appalachia “coal is really dropping, and we expect that to continue.”

The reason: Kentucky’s coal costs three times as much to mine as Wyoming’s. That is crucial as coal finds itself competing with supplies of low-cost natural gas unlocked by advances in drilling known as hydraulic fracturing, or fracking.

In the wide, vast plains of Wyoming’s Powder River Basin, where coal can be scooped out and piled high onto railcars headed for Texas and Midwest power plants, production is on a modest upswing.

That’s sparked a boom in the town of Gillette, where the local unemployment rate is 2.9 percent, less than half the nation’s 6.1 percent, and the median family income is $77,000, more than 40 percent higher than then national average. Within the past year four new frozen yogurt shops opened, along with the $5.5 million Jordan’s Western Dining steakhouse that has the cattle brand of former vice president and Wyoming Republican congressman Dick Cheney seared on a wood beam near the bar.

The scene is very different along Kentucky’s jagged eastern edge. The cheapest, easiest coal to mine was carved out decades ago, and now mining companies are shedding workers and seeking bankruptcy protection. The unemployment rate is 14.8 percent and doctors are drug-testing their own patients to make sure they are taking — rather than hawking — pain medication.

For the rest of this article, click here: