Production down at Routt County’s Twentymile Mine in 2018
STEAMBOAT SPRINGS — Production at Twentymile Coal Co.’s Foidel Creek Mine fell by 20 percent between 2018 and 2017.
The mine produced 3 million tons of coal in 2018, compared to 3.8 million in 2017, according to data from the Colorado Department of Natural Resource’s Division of Reclamation, Mining and Safety.
“Peabody’s Twentymile Mine in Colorado sold 2.9 million tons of coal in 2018, based on volumes targeted to meet customer needs,” wrote Peabody Energy spokesperson Charlene Murdock in an email to the Steamboat Pilot & Today. “Nearly 30 percent of Twentymile’s 2018 production served export contracts.”
The Pilot asked several questions about factors influencing production and mine operations. The following was the only response Peabody gave.
Production at the mine has been varied
The number of employees working at the mine has fallen by similar percentages. According to the Division of Reclamation, Mining and Safety, in December 2018, the mine employed 266 people. In Dec. 2012, that number was 451.
“When you drop out those 130 jobs at $100,000 a job, and the secondary effects of those things — that’s what’s really been the critical thing,” said Routt County Commissioner Doug Monger.
Over the years, lower production and the economic downturn within the coal industry have also led to a decrease in the mine’s value in the eyes of the Routt County Assessor’s Office.
“Every year, property tax off of them just keeps going down, and it’s just not being replaced, either,” Monger said.
Once the county’s biggest taxpayer, Peabody Energy, the company that owns Twentymile, was the county’s fourth-largest taxpayer last year, behind Xcel Energy, Union Pacific and Steamboat Ski and Resort Corp.
This also impacts the Soroco School District, the South Routt Regional Library and other taxing districts that provide public services in Oak Creek, Yampa and Phippsburg. In 2018, Peabody contributed $881,832 to the Soroco School District through bond and general mill levies.
Gary Peterson, county assessor, said the mine’s personal property account, which includes mining equipment such as the long wall and underground mine vehicles that aren’t licensed, peaked at a valuation of $116.9 million in 2009, which has since fallen to $34.5 million in 2018.
“We’ve had to start a plan of economic obsolescence to personal property — their equipment and buildings — because of the economic hardships in the industry of coal,” Peterson said. “Their equipment is not as valuable as it used to be, because who is buying coal mines? Nobody.”
Economic obsolescence was first applied to some of the mine’s valuation in 2017. Off the bat, the mine’s personal property fell from $64.7 million in 2016 to $42.6 million in 2017.
“Beyond physical depreciation, now you have an economic depreciation of 37 percent, so it wipes out a third of the value,” Peterson said.
“It’s just a downward spiral, and we’re trying to figure out how we can keep some of it alive, and especially the jobs that are created out there,” Monger said.
He hopes to keep up Hayden Station, which he said is Twentymile’s main contract for coal.
“If we can take care of the Hayden power plant, we’re also keeping Twentymile coal alive and functioning as well,” he said.
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