December 2011   —   Issue # 2011-12

Mining Metrics
 

Poll Watch

Election Outlook

The 2012 elections are now less than a year away. Here is what the polls are saying today:

White House:

      43%   Mit Romney
      42%   Barack Obama

Source: Rasmussen Reports
Dec. 16, 2011.

Generic Congressional ballot – percentage of likely voters who would vote:

      42%   for the Republican
      39%   for the Democrat

in their congressional district if the election were held today.

Source: Rasmussen Reports
Dec. 12, 2011.

 

2011: A Year of Change & Challenge

As 2011 draws to a close, our editorial staff has put together a review of the major issues that presented opportunities and challenges to the mining industry in 2011. Issues seem to break into classic good news / bad news categories:

Good News comes in two areas:

Rare Earth Minerals and Mining U.S. policy makers have been re-awakened to the critical need to challenge China’s strangle-hold on strategic metals and minerals needed for America’s high-technology manufacturing and defense industries – and to challenge China by enabling the U.S. rare earth mining industry to get back on its feet.

Mining Leads the Way in Job Creation As an industrial sector, mining leads the way in high-value, high wage job creation that has helped extract the U.S. economy from recession.

Bad News of 2011 will remain with mining into 2012. The Administration’s EPA continues to press forward with regulations to create an economic train wreck for the U.S. Economy by forcing unprecedented new costs and burdensome regulations – all with questionable environmental benefits – on the coal-powered electric utility industry. The EPA train-wreck regulations pose higher costs to household and industrial power consumers, declining electric reliability, and threaten recovery from recession.

The following issue summaries are “mined” from our prior newsletters this year. We invite you to peruse them again as you conduct your own year-end review of 2011 issues and events.

2011: December

EPA’s Utility MACT: Bad for American Workers and the Economy

In a recent statement by NMA President and CEO Hal Quinn, on EPA’s final Utility Maximum Achievable Control Technology (MACT) standard for power plants, Quinn said, “EPA has ignored the concerns of thousands of American workers and millions of consumers that rely on affordable and reliable coal-based electricity to power their factories and light their homes. At every opportunity, EPA has chosen the most costly and economically damaging options over a more prudent and balanced approach for achieving continued emission reductions at our nation’s power plants.”

“The cumulative economic impact of this and other rules pouring out of EPA has been spared rigorous analysis – leading many experts to project dire cost increases and threats to the reliability of the nation’s electricity supply. Unfortunately, consumers and businesses will not be spared the projected 25 percent increase in the cost of electricity nor the consequences of a far less reliable electricity grid that must somehow compensate for the loss of one-fourth or more of coal-based generation.”

A complete copy of the statement is available at: Hal Quinn statement on MACT.

United Mine Workers On EPA’s MACT Rule:
“Obama’s EPA Is Tone Deaf...Will Cost 50,000 Jobs”

United Mine Workers of America (UMWA) International President Cecil E. Roberts, said the Obama administration and the EPA are “tone deaf in dealing with issues that will effect coal miners, their families and their communities.” Roberts continued saying, “Instead of taking a reasonable approach that gives utilities the time they need to meet the stringent requirements set by these rules, the White House and EPA Administrator Lisa Jackson have decided to stick with rigid requirements that will lead to the premature closing of dozens of power plants around the nation and the potential loss of 56,000 megawatts of electric generation capacity. Studies we have done predict this rule will put more than 50,000 jobs in the utility, coal and transportation industries at risk, and threaten tens of thousands more in supporting and dependent industries.”

“We have held repeated meetings in the White House and at the EPA, bringing our concerns about just how significant of an impact these rules will have on the people we represent...but many of our suggestions for ways to make this rule more workable have simply been ignored.”

A complete copy of the statement is available at: Cecil E. Roberts statement on MACT.

House Passes Gibbs’ Bill to Rein-in EPA

The U.S. House of Representatives passed legislation that reverses the erosion of states’ authority under a long-established partnership with the federal government to regulate the nation’s water quality. H.R. 2018, the “Clean Water Cooperative Federalism Act of 2011,” is bipartisan legislation sponsored by Rep. Bob Gibbs (R-OH), Chairman of the Water Resources Subcommittee, as well as Transportation and Infrastructure Committee Chairman John L. Mica (R-FL) and Committee Ranking Member Nick J. Rahall (D-WV).

“With unemployment at 9.2%, we cannot allow the EPA to continue creating uncertainty that hampers job creation by interfering and second guessing decisions made by states’ federally approved permitting programs,” Gibbs said. “Their overreaching burdensome regulatory regime destroys jobs and strangles economic growth. This is really a jobs bill. We are trying to relieve uncertainty. We have sent several bills to the Senate that are jobs bills, including my bill HR 872, and I urge them to take them up because we need to create an environment for job growth.”

A complete copy of the press release is available at: Press release from Rep. Gibbs.

2011: The Year in Review – 1st Quarter

EPA’s Regulatory Train Wreck

Environmental Protection Agency bureaucrats thumbed their collective noses at record high unemployment in the U.S., the cost of living for American families, and the cost of operating a business. With 14 million Americans out of work, our nation’s extraordinary reserves of domestic minerals are more critical than ever before – especially as our nation searches for resources capable of powering and sustaining a robust, long-term economic recovery.

EPA was poised to enact a series of back-door regulatory mandates – without any Congressional approval – that threaten millions of American jobs and increases the cost of every household’s electricity-rates. Collectively, it’s called the EPA “Train Wreck,”. According to the United Mine Workers, job losses associated with the the EPA’s economy-killing rules would lead to the closure of EPA-targeted coal units and could mean the loss of 50,000 direct jobs in the coal, utility and rail industries, and an indirect job loss figure exceeding 250,000 – UNLESS Congress blocks them.

Minerals Make Life: The Value of Mining in Our Daily Lives

“Minerals Make Life,” is a familiar concept to workers and students close to the mining industry, but more Americans in all walks of life are about to become more familiar with the importance of minerals to Americans, with the launch of a new program by the National Mining Association. “This is an opportunity for us to demonstrate minerals’ importance to the nation,” said Hal Quinn, president and CEO of NMA. “If we want to continue to grow our economy and lead the innovation race, we need to engage in constructive conversations about balanced policies that encourage investment in the development of our domestic minerals.”

At the heart of the campaign is the message of the economic value of minerals to America and the challenges facing the nation’s supply chain and solutions to ensuring increased investment in developing domestic mineral resources. Minerals mining supports more than 1.1 million American jobs nationwide, and minerals are used to make roughly $2 trillion worth of products annually – about 13 percent of U.S. gross domestic product. It will also underscore the United States’ diminishing share of global investment in metals mining – the lowest in history – and how that impedes the nation’s ability to succeed as other countries compete for mineral resources.

2011: The Year in Review – 2nd Quarter

Coal To Gasoline – New Legislation Aimed to Ease
Pain at the Pump

U.S. Senators John Barrasso (R-WY) and Joe Manchin (D-WV) introduced The American Alternative Fuels Act (S. 937), a bipartisan effort to drive down the cost of gasoline – estimated to be an extra $800 that Americans are expected to pay at the pump this year – and decrease U.S. dependence on foreign oil. Senators Roy Blunt (R-MO), Dan Coats (R-IN), Mike Enzi (R-WY) and Lisa Murkowski (R-AK) are original cosponsors of the American Alternative Fuels Act.

“It’s more important than ever that we make it as easy as possible to use all available sources of American energy,” said Barrasso. “Our unacceptably high gas prices are hurting not only West Virginians, but all Americans, and they underscore a critical need: the federal government needs to be a partner, not an obstacle, for businesses that can transform our domestic energy resources into gas,” said Manchin.

A complete copy of the press release is available at: Press Release from Sen. Barrasso.

New Proposal To Revitalize U.S. Critical Minerals Supply Chain

U.S. Sen. Lisa Murkowski, R-Alaska, released a discussion draft of legislation designed to revitalize the nation’s critical minerals supply chain. “Minerals are the building blocks of our economy,” said Murkowski, ranking member of the Senate Energy and Natural Resources Committee. “From rare earth elements to molybdenum, we rely on minerals for everything from the smallest computer chips to the tallest skyscrapers. This draft bill provides clear, programmatic direction to keep us competitive with foreign nations and promote a stable supply of critical minerals.” The draft legislation directs the U.S. Geological Survey (USGS) to establish a list of minerals critical to the U.S. economy and sets out a comprehensive set of policies to ensure the nation is able to meet its own mineral needs.

A complete copy of the press release is available at: Press Release from Sen. Murkowski.

2011: The Year in Review – 3rd Quarter

Coal Solutions for America

There is no rational argument for weaning the United States off coal. Consider that the U.S. possesses the world’s largest storehouse of coal at a time when all projections show global coal demand will increase substantially in coming decades. Eliminating coal’s use in this country would mean denying American households and industry the most reliable and affordable fuel for generating electricity. It would mean eliminating more than a half million jobs that pay an average annual wage exceeding $72,000. And it would mean foregoing energy security for America.

We know realistic options for affordable electricity today are dwindling at the same time a powerful industrial revolution in Asia is increasing demand for coal that is essential for steel-making and electricity generation. We also know there is much we can do to fully exploit the advantage coal provides for improving U.S. energy independence – a key consideration at a time of increasing global competition for energy resources.

The solution for the U.S. should be two-fold:

Advanced Coal Technologies First, strengthen our national commitment to developing advanced coal technologies that both make coal cleaner and more efficient to use. For example, super-critical pulverized coal plants achieve efficiency improvements of 22 percent and ultra-supercritical plants improve efficiency 32 percent over the current coal fleet average.

Regulatory Framework Second, we must rationalize our regulatory framework for the entire coal supply chain. We can and should continue to make significant environmental progress. But this can be accomplished in ways that sustain a vibrant coal industry capable of serving domestic and global markets and, at the same time, allow power companies to retrofit the coal fleet economically with advanced environmental and combustion technologies.

For these reasons, the challenge for the U.S. is not to reduce coal’s use, but to use coal with the advanced technologies that we and the world need. That is the only sensible solution for a country with enormous reserves of coal and for a world that is destined to use more of it.

National Critical Minerals Policy

There is growing bi-partisan support in Congress to fix dated and cumbersome U.S. policy regarding the production of critical minerals. The effort comes in the wake of a near crisis of supply during recent months, wherein China manipulated its monopoly on production and distribution of strategic minerals in the global market. Computer and cell phone technologies, strong and light-weight structural materials, and special alloys for jet engines all rely on critical rare-earth minerals – where China holds a 97 percent production monopoly.

There are major economic and national security issues involved here. Each year the U.S. military alone uses over 700 thousand tons of critical minerals in an array of military applications to support national security. Many rare earth minerals could be produced in the U.S. to ensure supply reliability to U.S. manufacturers and help support U.S. job creation and overall economic growth.

The National Strategic and Critical Minerals Policy Act of 2011 (H.R.2011), introduced by Rep. Doug Lamborn of Colorado is designed to revitalize the U.S. critical minerals supply chain. Rep Lamborn said, “Leaving our manufacturing base and economy at the whims of foreign nations that control the resources needed for our modern economy is unacceptable. The United States must address this issue head on, not only for our domestic security but to spur job creation and strengthen our economy.”

The legislation directs the Secretary of the Interior, via the U.S. Geological Survey, to coordinate a government wide survey of America’s national mineral policy, mineral supplies, demands and other critical factors impacting mineral development, including workforce, permitting and regulations. The House legislation and its Senate companion legislation, S. 1113 introduced by Sen. Murkowski of Alaska, will create a clear national minerals policy that will help break our dependency on China, cut through the federal government’s red-tape and encourage more domestic production of critical minerals that are vital to the prosperity of America’s economy and the national security of the United States.

2011: The Year in Review – 4th Quarter

Mining Creates Jobs!

According to the Bureau of Labor Statistics, in one year – between June 2010 and 2011 – coal mining jobs grew 7.6 percent, metals mining jobs grew 3.9 percent, and jobs in support activities for mining grew at a rate of 19.2 percent. And mining job growth has continued to be robust in 2011 – particularly compared to other industries. See “Mining Metrics” graphic at the left.

A complete copy of NMA President Hal Quinn’s testimony before the U.S. House Committee on Natural Resources with respect to mining’s creation of jobs is available at: Testimony of Hal Quinn.

EPA Regulations Hurt Job Creation

In an editorial published by Politico.com, Congressman Scott Tipton calls the EPA failure to consider the impact of their proposals on small business and jobs a “toxic mix” that will drive the U.S. economy further into the ground. He specifically cited the proposed 43 major new regulations proposed last year in addition to 219 more that are in the pipeline. He said on average, government regulations cost small businesses nearly $10,585 per employee.

A complete copy of the story is available at: Politico.com.

Does The Obama Administration Get the Message
on Mining Jobs?

A Wall Street Journal editorial said “Obama made the call to defer the Environmental Protection Agency’s new, strict standards on ozone emissions, but make no mistake: Yesterday’s politically destructive “zero” for new-job growth lies at the center of this startling and welcome decision.” The president can continue on this path to do less harm to the U.S. economy by deferring other unwarranted EPA regulations.

In August, it became clear that the U.S. Environmental Protection Agency (EPA) failed to consider the impact of its new air regulations on the reliability of our electricity generation capabilities and could put the nation’s economy at further risk. This is the inescapable conclusion based on documents released in August by Sen. Lisa Murkowski (R-Alaska).

Letters from the chairman and commissioners of the Federal Energy Regulatory Commission (FERC), charged by law with ensuring generation reliability, clearly state no formal assessment has been made of the impact of proposed and promulgated air regulations on the nation’s ability to meet the electricity needs of American households and businesses.

NMA supports the FERC commissioners’ unanimous call for a comprehensive and rigorous analysis of the cumulative impacts of the new air regulations on electricity generation reliability and affordability.