Fossil Fuel Expansion Continues with New Coal Mining, Offshore Drilling

By Dave Levitan

As the nuclear crisis continues to unfold in Japan, and as some wonder if renewable energy and natural gas might end up winners in the wake of the disaster, the Obama administration continues to expand the use of our old fossil fuel standbys, coal and oil. Such expansion illustrates the difficulties of balancing the goals of achieving greater energy independence in the near-term and boosting the prospects for renewable energy technologies, such as solar and wind power.

On March 21 and 22, the Department of the Interior (DOI) made two announcements: the Bureau of Land Management will hold lease sales for massive tracts of land in the Powder River Basin region of Wyoming that hold an estimated 758 million tons of mineable coal; and the Bureau of Ocean Energy Management, Regulation and Enforcement approved the first new deepwater oil exploration plan in the Gulf of Mexico since last April’s Deepwater Horizon blowout and resulting massive oil spill.

Aerial photo of coal mining activity in Wyoming's Powder River Basin. Credit: flickr/dsearls.

Wyoming is already the coal mining capital of the country, as well as of the world. There is more energy stored in Powder River Basin coal than in any oil or gas field on the planet; in 2009, according to the Energy Information Administration (EIA), the U.S. got 45 percent of its electricity from coal, and about 40 percent of all that coal came from Wyoming. Last year, companies in Wyoming mined a total of 442.5 million tons of coal, according to Wyoming State Geological Survey geologist Nick Jones.

One question about these new lands the DOI will open up for further coal mining is where the coal will go once it is mined. U.S. coal exports have shot up dramatically in recent years, especially to China, which first became a net importer of coal in 2007. According to the most recent EIA estimates, the first three quarters of 2009 saw U.S. exports of 3.85 million short tons of coal to Asia; through the same period in 2010, the number was 13.1 million short tons, with 4.1 million of that headed to China.

Overall, though, total U.S. exports of coal are dwarfed by domestic consumption that has hovered around 1.1 billion tons in recent years. According to Jones, almost none of the massive hauls of Wyoming coal leave the country for Asia.

“The Wyoming coal that is exported is a very low percentage of the whole pie,” he said. “The remainder, probably about 95 percent of our production, is used domestically.”

Jones added that there are ongoing efforts to change that situation. Some companies, including Ambre Energy, Arch Coal, and Peabody Energy, are working to establish terminals along the Pacific Northwest coastline that could serve as portals to send millions of tons of coal across the Pacific Ocean each year. Jones said, though, that the infrastructure required to begin exporting such amounts of coal probably wouldn’t be in place for at least five years.

The U.S. reliance on coal for electricity is a commonly cited barrier in the way of reducing greenhouse gas emissions; for every one of those 1.1 billion tons of coal burned in the U.S. last year, more than two tons of carbon dioxide (CO2) were released into the atmosphere. And even as this country continues to add cleaner technologies to the electricity grid, sending more and more coal to be burned in the burgeoning new power plants in China could cancel out those gains.

Timothy Considine, an energy expert at the University of Wyoming, pointed out that the type of coal is an important consideration in making environmental calculations, however.

A coal-fired power plant. Credit: istock.

“There has been some concern that us shipping coal to Asia is bad for the environment,” he said. “But if it is displacing brown [also called lignite] or high-sulfur coal it actually may be better for the environment.” Powder River Basin coal is low-sulfur coal; its sulfur content tends to fall well below one percent, compared with Appalachian coal that has sulfur contents generally between two and five percent.

Though sulfur content is unrelated to CO2 emissions, burning higher sulfur content coal can contribute to acid rain as well as human health problems. China is trying to cut down on sulfur dioxide emissions from coal-fired power plants, but they do not have the same strict emissions standards that exist in the U.S. under the Clean Air Act and other statutes.

Domestic oil production on the rise?

Due to the abundance of domestic sources, coal does not suffer from one issue that dominates the discussion of oil, its fossil fuel cousin: energy security and reliance on foreign imports. On March 30, one year after President Obama’s speech calling for expanded offshore oil drilling — which came only a few weeks before the Deepwater Horizon disaster – the President once again made a speech about energy security. He made it clear that “for quite some time, America is going to be still dependent on oil in making its economy work.”

This time, though, while outlining the need for further offshore exploration to reduce dependence on foreign oil, he also emphasized new, stringent safety measures put in place since the oil spill. And mixed in with the message on domestic oil production, President Obama told students at Georgetown University that there is a longer-term goal of moving the US beyond oil:

“We’ve got to discover and produce cleaner, renewable sources of energy that also produce less carbon pollution, which is threatening our climate.  And we’ve got to do it quickly.”

In spite of that need for moving away from fossil fuels, and a clear commitment to supporting clean energy and improvements in energy efficiency, the Obama administration continues to allow expansion of the offshore oil industry. The latest announcement of a newly approved deepwater drilling exploration plan for Shell Oil might fit with energy security goals, but it comes at an awkward time, only a few weeks before the anniversary of the Deepwater Horizon explosion and massive oil spill.

An oil drilling platform in the Gulf of Mexico. Credit: istock.

Opponents of drilling hoped the moratorium put in place following the spill would stick, but this new approval could signal a restart to new deepwater drilling in the Gulf following the end of the moratorium in early October. It marks the first of a certain type of application that successfully navigated a new system of environmental approvals put in place since the spill and related scandals that rocked the Minerals Management Service. The MMS, formerly the agency responsible for every aspect of offshore drilling — from environmental approvals to collection of royalties — is now undergoing restructuring and will be divided into separate pieces. The director of the MMS' replacement, the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), Michael Bromwich, offered an optimistic outlook for deepwater oil drilling. 

“The successful completion of this environmental assessment, and the resulting approval of Shell’s exploration plan, unmistakably demonstrates that oil and gas exploration can continue responsibly in deep water,” Bromwich said in a press release. “Shell’s submission has satisfied the heightened environmental standards that we are now applying and I am confident that other operators can satisfy the same standards.”

Some of the new requirements [PDF] to an exploration plan like Shell’s include a “blowout scenario,” as well as a worst-case “discharge scenario.” To be clear, though, the new approval is far from the first deepwater action undertaken since the oil spill. According to the BOEMRE’s up-to-the-day data on drilling and exploration applications, six new wells in water greater than 500 feet deep – the cutoff used as the definition for deepwater drilling – have been approved since October 12 of last year (when the moratorium on all deepwater drilling lifted).

BOEMRE approved 14 other “revised new well” applications, as well as other drilling operations. Shell’s new exploration plan, which calls for drilling of three wells at a depth of 2,950 feet, is only the first “supplemental exploration plan” approved. Ten revised exploration plans have been approved since October 12, 2010.

In spite of those actions, the Obama administration has shown some inclination to hold back on offshore drilling. In December of last year, a moratorium was reinstated on drilling in the Eastern Gulf of Mexico and off the Atlantic and Pacific coasts. It was these areas that President Obama suggested opening up for oil exploration in last year’s speech three weeks before the April 20 Deepwater Horizon disaster.

In his latest speech, President Obama set a goal of cutting foreign oil imports by one-third within a bit more than a decade. The President wants one million electric vehicles on the road by 2015, and he wants the U.S. to start catching up to countries like China and Germany in development of renewable energy technologies. The administration’s continued expansion of fossil fuel development, though, shows that the road to those clean energy goals is not a straight one.