Posted on 11/26/2012 5:15:40 AM PST by thackney
The boom in U.S. natural-gas production has driven economic growth across much of the country, but not everyone is a winner, including this rural town in Appalachia, rich in natural gas and coal.
A glut of natural gas has pushed prices lower for both gas and coal, which compete to supply electricity. This has lowered energy costs for homes and businesses, given a crucial competitive advantage to manufacturers that use natural gas as a raw material, and created jobs in other industries, like steelmaking, trucking and construction that make products and supply services to drillers.
But lower prices for coal and gas have resulted in lower revenues for some energy companies, prompting them to cut back on gas drilling and coal mining, though that could resume once prices strengthen, as many experts expect.
In a handful of states, while consumers and many businesses are benefitting, some local and state government tax collections are being impacted. The budgetary squeeze is particularly acute in West Virginia, where rich reserves of coal and natural gas have long been a key source of revenue.
n September, Arch Coal Inc. idled a local coal mine here that employed 50, and natural-gas producer Chesapeake Energy Corp. laid off 115 workers at a field office here earlier this month, relocating most of them to Ohio where its drilling is more profitable and where jobs and revenues continue to grow.
"Do we have a future or not?" asked Bill Nesselrotte, owner of mining company Nesco Inc., as he surveyed a 160-acre surface coal mine outside Buckhannon where bulldozers and dump trucks are parked atop barren slopes and water has gathered in a 100-foot-deep pit near an exposed coal seam.
Mr. Nesselrotte laid off his 12 employees last month because none of his power-plant customers needs any coal.
(Excerpt) Read more at online.wsj.com ...
always good to see your topics...thanks
While I know natural gas prices are affecting the demand for coal, I hope the rest of the article managed to mention the Obama Administration’s War on Coal as another important element affecting the price.
Given that the news side of the WSJ is about as Liberal/Leftist as any other MSM news organ, it would not surprise me if it did not.
The 0bama admin will quickly put a stop to the peasants using this cheap energy.
Gas is selling for around $3.60 MM.
Coal can be mined and sold profitably for this figure.
“Abundance Aids Consumers ... States Feel Tax Hit”
Sounds like win-win to me
It sounds like they're crying over nothing. Look at the above, they're relocating the workers to other areas. This isn't a bad thing. It isn't like they can get mexicans to do this work for minimum wage. The modern gas well driller and coal miner is a skilled individual who makes a decent salary. That's the tragedy of 0bama's war on fossil fuels. He's killing off solid middle class jobs.
Just keep in mind, it wasn't cheap labor and expensive energy that built the country, it was cheap energy and (relatively) high cost labor, coupled with low taxes.
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I live just outside Buckhannon. Vast majority of those lost rig jobs were not worked by locals to start with, nor were all those jobs in the immediate area. I have two neighbors who go to OH and PA on two week rotations to work rigs there. Know a fellow who drives a water truck in the gas fields of the Carolinas. There is still a LOT of gas field work in the region.
Coal draws more from the area and the loss of those jobs does have an impact, though not necessarily on Buckhannon itself. Most of those workers come from surrounding counties.
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