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Utah Mining Association Newsletter

November 2007 Edition
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EVENTS

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LIFESPAN COMPLETES
JOINT VENTURE AGREEMENT

(Source: Business News Wire, 10/31/07)

Lifespan Inc. is pleased to announce that it has entered into a joint venture agreement whereby USA Uranium Corp. has acquired the right to joint venture a 75 percent interest in the La Sal West mineral claim group located in the prolific La Sal uranium district of Utah.

Additionally, USA Uranium has now advised the Company that it is exercising its option to purchase the 75% interest in the Property. The terms of the purchase require USA Uranium to issue $3 million dollars worth of their shares, consisting of 4 million shares, for the 75% interest. From this point forward each party will bear their pro rata costs of ongoing exploration and development of the Property.

This exciting property consists of 111 BLM claims comprising 2,200 acres. The property covers a portion of the north/central La Sal District trend and contains three significant past producers: the Bluejay Mine, the M-6 Mine and the Balsley Mine. Pursuant to the terms of the Joint Venture agreement, our joint venture partner completed an extensive phase-one work program on the Property and we will be releasing the results of the Geologist's report once evaluation is complete.

CEO Stuart Brame stated: "The completion of our first joint venture verifies Lifespan's business model of acquiring high grade conventional uranium projects, with past production, located in the Continental US and then seeking outside expertise to develop the properties. We anticipate adding several similar properties to our portfolio in the near future, which we also intend to joint venture with significant partners."

Previously the ore produced from these mines contained up to 0.35% U3O8 (Uranium) and 1.5% V2O5 (Vanadium) resulting in production of over one million (1,000,000) tons of ore. Ore of this caliber would equate to a value of over $600 per ton using the current spot price of $78 per lb.

Years of under-investment in uranium mining caused by moribund prices and the anti-nuclear lobby has left the world short of uranium to fuel nuclear reactors. But governments in Europe, United States, Russia and China and even environmental groups are currently warming to nuclear power because it produces significantly less greenhouse gases than conventional fossil fuels, according to the World Nuclear Association.

 

JOYCE CHRISTENSEN

Joyce DeWitt Christensen, 82, passed away of natural causes Thursday, November 22, in Salt Lake City. She was born October 10, 1925 in Logan, Utah. A daughter of Hiram Dennis DeWitt and Helen Bowen DeWitt. She married Jack E. Christensen August 26, 1947 in Logan, Utah and later solemnized in the Logan LDS Temple on November 11, 1953. She graduated from Logan High School and attended Utah State Agriculture College where she was a member of the Chi Omega Sorority. She worked for Utah Mortgage Corporation, USU Alumni Association, Utah Association of Counties, and Educators Mutual of Salt Lake City. Joyce was active in her church callings and PTA. A devoted wife, mother, grandmother, and friend. She was loved by all who knew her. She enjoyed many hobbies such as golfing, skiing, all aspects of needle work, was an avid reader, and very much enjoyed playing bridge with her friends. Joyce is survived by her daughter, Caren Laub, Bellevue, WA; sons, John, Logan, UT; Trevor (Debbie), Brigham City, UT; David, Salt Lake City, UT; and a sister, Iva Lou Hansen, Salt Lake City; 15 grandchildren and 13 great-grandchildren. Funeral Services will be held Friday, November 30th at 10:00 a.m. in the East Mill Creek Stake Center at 3103 East 3600 South in Salt Lake City. Friends may call at Larkin Mortuary, 260 East South Temple, Thursday, November 29th from 6 to 8 p.m. and at the church from 8:45-9:45 a.m. before the funeral service, interment at the Logan City Cemetery. Special thanks to the East Mill Creek Fourth Ward Relief Society and the many friends and neighbors who loved and fellowshipped with her. In lieu of flowers, contributions and donations can be made to the American Heart Association and the American Cancer Society. Online condolences at: www.larkinmortuary.com

Published in the Salt Lake Tribune from 11/25/2007 - 11/26/2007.

 

TRUE STATESMAN: UTAH NEEDS MORE LIKE ED MAYNE
(Source: Tribune Editorial, 11/26/07)

The Utah Legislature could use more lawmakers like Ed Mayne.

That's true, not only because Mayne, who died Sunday of cancer, was one of those rarest of political animals in Utah's single-party state government - a Democrat - but because Mayne was a true statesman.

Webster's defines "statesman" as "a person who shows wisdom, skill and vision in conducting state affairs and dealing with public issues." His friends and his political opponents agree that characterization fits Mayne to a T.

Mayne was serving his fourth term in the Utah Senate. The way he steadfastly championed the causes of working people and the poor - pushing for a higher minimum wage, to protect residents of mobile home parks, to maintain benefits for the poor and disabled on Medicaid - showed his wisdom and diplomacy.

He was often the voice of the minority Democrats in the Senate, not only because of his experience but because he could cut through partisanship to the heart of the issue in a way that did not offend those with differing views. Lawmakers on both sides of the aisle called him friend.

He had a vision for Utah as a place where elected officials would care for people who could not care for themselves, and he was often the leader of such causes, no matter the odds against.

Born in Magna, he was a hard-rock miner for 14 years for Kennecott Copper in its Bingham

Canyon mine, giving him a kind of brotherhood with all those who punch time cards. He was active in the United Steel Workers of America and became president of the local chapter in 1977 and, later, president of the AFL-CIO of Utah. As Utah's best-known labor leader, he lobbied the Utah Legislature on workers' behalf for 17 years before running for office.

Mayne worked tirelessly for the residents of Salt Lake Valley's west side, who elected him four times. He supported youth groups and helped secure parks and recreation programs. He fought for and won the 2002 Olympic speedskating oval for Kearns.

Through it all, Mayne was both a statesman and a gentleman - a combination that is all too rare in Utah politics today.

ED MAYNE MOURNED AS BOTH 'STRONG ALLY' AND 'ABLE ADVERSARY'
(Source: Paul Rolly, Salt Lake Tribune, 11/26/07)

He was the most high-profile labor leader in a state known for its stiff opposition to unions. He was a Democratic state senator in arguably the most Republican state in the union. He fought for causes that were unpopular among the majority of his colleagues.

Yet it is hard to find anyone who did not like Ed Mayne, the longest-serving state AFL-CIO president in the United States.

Mayne died of cancer at his home Sunday at the age of 62.

"We had differences and often fought on opposite sides of an issue, but I loved Eddie Mayne and had great respect for him," said Sen. Orrin Hatch, R-Utah.

Mayne and Hatch, through Hatch's ally, Republican state Rep. Mac Haddow, locked horns in the early 1980s in a bitter battle over the prevailing wage law, which required contractors to pay the prevailing wage in an area if tax dollars were used. Mayne lost the battle, and the state law that protected higher wages for construction workers was repealed. But even in bitter fights like that, Hatch appreciated their friendship, which never wavered.

"I admired and loved Eddie because of his dedication to all working men and women. His decency, honor and friendship meant a great deal to me," Hatch said.

"Ed was an able adversary at times, and a strong ally at times, but he always was a true statesman," said Senate Majority Leader Curt Bramble, R-Provo, who despite being on opposite sides of many controversial issues, kept a close personal friendship with Mayne.

"He was kind and gentle, but he was a ferocious warrior," Bramble said.

"We all respected how he cared so deeply for working men and women," added Senate President John Valentine, R-Orem.

"When I first came to the House of Representatives, Ed sat in the back on the Democratic side of the aisle. He wasn't a member of the Legislature then, but a lobbyist for the AFL-CIO. On every issue, the Democrats would look back at him for guidance. At first I thought it was his position in labor that made him so significant. Later, when I got to know him, I realized it was because of who he was."

Mayne was known for his ability to reach across the aisle to his Republican colleagues and bring opposing sides of emotional issues together for negotiations. Despite the negligible numbers of his party in the Senate, the force of his personality led Republican foes to listen to the minority point of view, colleagues said.

"Ed was respected by everyone for being evenhanded," said House Minority Leader and Salt Lake City Mayor-elect Ralph Becker. He was someone you could always rely on for his good judgment and his constructive presence in any negotiation."

Mayne was born in Magna Sept. 16, 1945, and graduated from Granger High School in 1963. He played football for Snow College for two years, then returned to Salt Lake County, where he got a job on the track gang for Kennecott Copper in Bingham Canyon mine.

He became active in the local chapter of the United Steel Workers of America and quickly rose to vice president of local 485. He became president of the chapter in 1977, leading a tough contract negotiation with Kennecott that year. Shortly after that, he was named president of the AFL-CIO of Utah, becoming, at the age of 32, the youngest chapter president in the nation.

After lobbying for labor issues for 17 years, he was elected to the state senate in 1994 and was in his fourth term when he died.

"Because he was such a personable guy and almost everybody like him, he gave the labor movement substantially more status than it had before him," said Allan Ayoub, labor liaison for the AFL-CIO of Utah.

At the Senate, Mayne worked to maintain benefits for the most needy Utahns on Medicaid. He worked on legislation to protect residents of mobile home parks from being evicted with little notice. He worked on negotiations to limit exploitation of low-income borrowers by payday lenders. He worked to increase the minimum wage for workers, even getting a coalition of business leaders to rally around that cause.

"Whenever there was an issue involving the needy or less fortunate, Ed was there and spent a great deal of time on it," said Senate Minority Leader Mike Dmitrich, D-Price. "And he was an animal lover. He once put in a great deal of his own cash and raised the rest to pay for a $2,500 operation for one of his constituents' dogs."

He was a booster of the Hunter High School football team, donating money and time to the west-side school. His support for community projects in Kearns led to the naming of a street after him in that west-side township: Ed Mayne Street.

"It is rare that you can find a person who is a combination of integrity, compassion, foresight and vision all in one," said Democratic Salt Lake County Councilman Randy Horiuchi. "He may have been the finest political person I have ever known."

Mayne and his wife Karen have two children, son Paul and daughter Jamie.

His friends and associates are holding a benefit banquet in his honor at The Grand America Hotel on Dec. 4

 

NEW BOSS TO FOLLOW MAYNE'S LEAD
(Source: Brianna Lange, Salt Lake Tribune, 11/26/07)

As the new president of the AFL-CIO of Utah, Jim Judd says the future of the statewide labor organization lies in continuing to build upon the legacy of its late president, Ed Mayne.

"We're going to be dealing with the same challenges that we've always faced - trying to make sure, as Ed did, that the voices of working men and women are heard in their communities and throughout the state," he said.

Previously the vice president of the AFL-CIO of Utah, Judd automatically became the labor organization's president upon the death of Mayne, who died of cancer at his home Sunday at the age of 62.

Judd also will continue to serve as president of the Professional Fire Fighters of Utah, a position he has held since 1985.

"A friend of mine once asked if anyone remembers who played in the outfield for the Boston Red Sox after Babe Ruth left," Judd said. "And that is how I kind of feel right now. How do you replace a legend?"

Thirty years ago, Mayne was named president of the AFL-CIO of Utah, becoming at the age of 32 the youngest chapter president in the nation. He was known for being an unwavering advocate for working families throughout the state.

Yet, those who know Judd say he will bring that same kind of commitment to his new position.

"Jim has always been extremely conscientious and passionate about his work," said Randy Atkinson, vice president representing the 9th District of the International Association of Fire Fighters, which encompasses Utah, Wyoming, Colorado, Nevada and Oregon. "And that helps explain why he has been around so long."

Atkinson pointed out that when firefighters negotiate new labor contracts, they bargain not just for higher wages and benefits, but also for new safety equipment that might be needed. "And Jim always focused on what had to be done to improve the quality of life for the guys and keep them safe," he said.

Judd first became involved in the labor movement in Las Vegas in the 1970s, when he joined the Teamsters. He moved to Utah in 1977 and went to work for the Ogden City Fire Department, becoming a member of Professional Fire Fighters of Utah Local 1654. He was elected vice president of the local in 1978 and president a year later.

For the past 12 years, Judd also served on the executive committee of the AFL-CIO of Utah. He ran for vice president and was elected at the organization's statewide convention in September.

"When I was considering running for vice president, Ed and I got together and discussed the possibility that I could end up as president," Judd said. "So this [becoming president] wasn't a complete surprise. Still, it is humbling to think about trying to step into his shoes."


RIO TINTO TAKES STEPS TO REPEL A BHP BILLITON BUYOUT
(Source: Rebecca Keenan and Brett Foley, Bloomberg News, 11/26/07)

Rio Tinto Group, parent company of Kennecott Utah Copper and the world's third-largest mining company, will increase its dividend 30 percent and may sell as much as $30 billion of assets in an attempt to repel BHP Billiton Ltd.'s unsolicited offer.

''Rio Tinto has under-promised and over-delivered,'' the company's London-based chief executive, Tom Albanese, said Monday. ''This has not been appreciated by the market, so we need to redress that.''

Rio's rejection of BHP's $128 billion all-share offer as too low has spurred speculation of further bids. The state-owned China Business Journal reported Monday that China Investment Corp., a $200 billion sovereign wealth fund, is planning an offer. Rio, whose shares have doubled this year, is the world's second-largest supplier of iron ore, used in steelmaking.

''They are trying to defend their turf and ensure they are in a better position for when the eventual discussion takes place for the groups to merge,'' said Australian stock broker Paul Xiradis. ''They were very bullish and were not guarded at all, given BHP has expressed interest in them.''

BHP Chief Executive Marius Kloppers wants Rio shareholders to pressure management to discuss a combination that would control more than a third of the iron-ore market and supply the most energy coal and copper. BHP has predicted annual savings and revenue gains of $3.7 billion from a merger.

Rio may treble iron-ore production to more than 600 million metric tons a year, Albanese said. Two new mines in Western Australia's Pilbara region will be developed at a cost of $2.4 billion. It would cost about $10 billion to increase output in the region to about 430 million tons, he said.

Shareholders can expect a further 20 percent gain in dividends in 2008 and in 2009, Albanese said. The increased dividend is ''a defensive move,'' against BHP, said Tobias Woerner, an analyst at MF Global in London. He added that Rio Tinto "should have shown its convictions earlier, especially in terms of mergers and acquisitions, and it wouldn't have been in this situation in the first place.''

The takeover battle offers investors a choice between two newly appointed CEOs who both predict a five-year rally in commodity prices will be sustained. Rio Tinto said Monday that demand for iron ore, copper and aluminum may as much as triple over the next 25 years, driven by expanding economies in China and India.

Rio Tinto Group, which bought aluminum producer Alcan Inc. for $38.1 billion, said the metal's price may rise as global demand increases and higher costs force China to cut production.

China, which tripled export taxes in 2006 to 15 percent, may become a net importer of aluminum next year. The government has removed a tax rebate on exports of some aluminum products to slow the expansion of smelters.

The price of aluminum gained 82 percent in the past five years, even with increased Chinese aluminum production during that time putting a ''damper'' on pricing, said Rio Tinto Alcan chief executive Dick Evans.

Also Monday, Rio Tinto approved a plan to invest $563 million in underground operations at its Diavik diamond mine.

 


AT UTAH MINING ASSOCIATION


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PRESIDENT'S REPORT
by David A. Litvin

As 2007 begins to come to a close, it has been a tremendously challenging year for our industry. With the big media attention focused on global climate change and the contribution to greenhouse gas emissions from fossil fuels, a paradigm shift in thinking about the future of global energy production and use is taking place. The mining sector will need to be looking at reducing its greenhouse carbon imprint and supporting new cleaner technologies. There will be business opportunities and critical challenges for all of us over the next 20 years not unlike when the Clean Air and Clean Water Acts were enacted in the 1970's.

In addition, Utah was the focus of public, media, and government attention during and after the Crandall Canyon Coal Mine incidents on August 6th and 16th. Governor Huntsman set up the Utah Mine Safety Commission to provide recommendations on what would be the appropriate state of Utah role in regards to mine safety, training, accident response, and accident prevention.

The Commission, on which I was asked and honored to serve, will be making some interim recommendations to Governor Huntsman in December 2007. In addition, MSHA and the U.S. Congress have launched investigations into the Crandall Canyon Mine incident, and Bob Murray has been subpoenaed to appear before Congress. It is critical that we remain steadfast and learn from what happened at Crandall Canyon to enhance the safety practices and procedures of all Utah mines.

I wish everyone a joyous holiday season as we pay thanks for our many blessings.

As an aside, please mark your calendars for the UMA Education Golf Tournament on June 10, 2008, at the Riverbend Golf Course, and the UMA 93rd Annual Convention at the Canyons Resort, Grand Summit Hotel in Park City on August 14-15, 2008.



SAFETY

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HELLO DOWN THERE: MATHESON BILL
COULD HELP FIND MISSING MINERS

(Source: Tribune Editorial, 10/31/07)

Rescuers above the Crandall Canyon coal mine drilled hole after fruitless hole in a desperate attempt to find six missing miners last August.

They lowered antiquated listening devices into the depths, set off explosions to attract attention, and listened in vain for the men to reveal their location by tapping the roof with hammers in response.

The Crandall Canyon miners carried PEDs - Personal Emergency Devices - that allow messages to be sent to miners. And the mine employed a standard hard-wired telephone communication system. Both failed when equipment was destroyed in the mine collapse, leaving rescuers, and the miners, in the dark.

In a world where we can communicate from the depths of the oceans and the far reaches of outer space, where global positioning satellites can pinpoint your precise location on the surface and animals can be tagged and tracked for their entire lives, we use hammers and microphones to find missing miners, and Ma Bell telephones to communicate underground. And that's inexcusable. There has to be a better way, and U.S. Rep. Jim Matheson, D-Utah, is determined to find it.

Matheson has wisely sponsored legislation that would give $1 million to the National Institute of Standards and Technology to work with private firms and other agencies to develop underground communication and tracking technology. The legislation was approved by the House this week and sent on for the Senate to consider.

The bill augments the Miner Act of 2006, which requires that a wireless, two-way communication system, or the best technology available, be installed in American deep mines beginning in 2009. But the best available technology - essentially the same systems that were already in use at Crandall Canyon - is inadequate. And due to the exorbitant cost of research and development, and the limited market provided by the mining industry, there's no incentive for private, profit-driven firms to come up with something better on their own.

That's not a knock on capitalism; it's just the nature of the beast.

So, without the healthy dose of tax dollars that Matheson's bill would provide, rescuers will continue to rely on hammers and microphones to find missing miners. And missing miners will continue to die.

The Senate should approve the bill. Lives depend on it.

 

MINE SAFETY: CONGRESS CONSIDERS OVERHAUL OF RULES AND REGS
(Source: Tribune Editorial, Salt Lake Tribune, 11/05/07)

It's a simple, noble, attainable goal, one Utah's underground miners can live with. "We want to do everything we can to ensure that miners are able to return home safely at the end of their shifts."

That from U.S. Rep. George Miller, D-Calif., the chairman of the House Education and Labor Committee and sponsor of the Supplemental Mine Improvement and New Emergency Response Act of 2007.

The bill was drafted in response to another deadly year in U.S. deep mines - 25 coal miners and 28 other miners have died to date. It enhances and hastens many of the safety provisions contained in the Miner Act of 2006 and provides for additional rules and regulations in an industry where safety is sometimes sacrificed in the quest for profit.

There's a lot to like about Miller's bill, which is co-sponsored by U.S. Rep. Jim Matheson, D-Utah, and was inspired in part by the tragic accidents at Utah's Crandall Canyon coal mine in Emery County, where six miners and three rescue workers were killed in mine collapses in August.

The legislation would establish the Office of Miner Ombudsman, which would receive and track anonymous complaints from miners who are aware of dangerous mining conditions or safety violations, but are afraid to speak up for fear of losing their jobs.

It would give the federal Mine Safety and Health Administration absolute authority to supervise and direct rescue and recovery efforts after mine accidents, negating the need for voluntary cooperation of mine owners.

And it would provide for more oversight of retreat mining - a dangerous mining method in which coal is scavenged from mine support walls - in mines more than 1,500 feet underground, which are common in the West.

The committee forwarded the bill to the full House in a 26-18 vote that fell along partisan lines, with Republicans, including Rep. Rob Bishop of Utah, siding with the mine industry and MSHA in opposition.

Bishop, who argued that the Miner Act of 2006 is not yet fully-implemented and probes of the Crandall Canyon tragedies are still under way, says the bill is premature and takes "everything to an extreme." But it's obvious that immediate and extreme measures are needed, because miners are still dying by the dozens. Congress should approve this bill.

 


COAL

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HOUSE PANEL DRAWS IRE OF COAL INDUSTRY,
MSHA FOR BACKING MINE SAFETY OVERHAUL PLAN

(Source: Thomas Burr, Salt Lake Tribune, 11/1/07)


WASHINGTON - The coal mining industry and the federal agency overseeing mine safety objected to legislation passed out of a House committee on Wednesday that would revamp safety laws in the aftermath of the Crandall Canyon disaster.

The National Mining Association, a trade group of mine operators, called the bill "premature," while the federal Mine Safety and Health Administration, MSHA, said that as a whole, the measure imposes restrictions that are "unrealistic and unlikely" to substantively heighten safety.

"This bill is far more likely to impede rather than improve our ongoing efforts to enhance mine safety," NMA President Kraig Naasz said, adding that operators are working to implement a measure passed last year and this legislation would enact additional requirements and overturn others in the 2006 bill.

Democrats, however, heralded the measure as a much-needed improvement to mine safety laws in a year that so far has seen 25 coal miners and 28 other miners killed on the job. Six of those miners and three rescue workers died in two separate cave-ins at Utah's Crandall Canyon mine in August.

House Education and Labor Committee Chairman George Miller, D-Calif., said the legislation is a comprehensive approach to minimizing health and safety risks to miners.

"Our aim is a simple one: We want to do everything we can to ensure that miners are able to return home safely at the end of their shifts," Miller said.

The bill passed the committee on a 26-to-18 party-line vote, with Republicans opposing the measure. Rep. Rob Bishop, R-Utah, voted against the legislation.

Among other changes, the bill would call for more oversight of retreat mining, a method used at Crandall Canyon mine, with specific focus on mines more than 1,500 feet underground.

Retreat mining involves removing pillars of coal holding up the ceiling and allowing the roof to collapse, a process critics say is dangerous and may have led to the Utah disaster, which occurred 1,900 feet underground.

The United Mine Workers of America said the bill's passage was a "huge step" in the right direction for the health and safety of miners.

"The American public has seen for itself - far too often over the last two years - just how bad safety conditions in some coal mines in this country can be, and just how callously some coal operators disregard the mine safety laws that are already in place," said union President Cecil Roberts.

The Supplemental Mine Improvement and New Emergency Response Act shows that the House committee is listening to the public, Roberts said, not those who say enough has been done and Congress must back off for a while.

"Clearly, enough hasn't been done," he said. "Miners are still dying."

The committee's ranking Republican, Howard "Buck" McKeon of California, said his fellow party members grieve for the fallen miners but this legislation isn't about Crandall Canyon.

He said it was an attempt by the Democrats to rewrite a law just passed and not yet fully implemented.

"Despite the early successes of the law, my colleagues have proposed undoing the progress that has been made by layering on a new set of regulations and requirements," McKeon said, adding that the legislation has "the potential for serious negative consequences."

The head of the federal Mine Safety and Health Administration also expressed concern about portions of the legislation.

While the agency backs some provisions, those are "offset by potential harm" in the bill, MSHA director Richard Stickler said in a letter to the committee.

Bishop, the only Utah member on the committee, said he voted against the bill "because it's bad" and takes "everything to an extreme." Last year's Mine Improvement and New Emergency Response Act is just being put into place and shouldn't be amended before it can start working, he said.

"It's hard to find something positive about this thing," Bishop complained after the hearing. With 11 different bodies - including three congressional probes - looking at the Crandall Canyon disaster, Bishop says there's no need to rush to pass laws when the tragedy has yet to be fully explored.

The legislation also creates an ombudsman for miners to hear concerns from whistle-blowers who fear retaliation for speaking out. It allows, as well, MSHA to force a mine owner to comply with rescue operations.

The House committee recently heard from families of the victims of Utah tragedy who charged that MSHA did not do enough to protect them.

Republicans offered three amendments to the bill, including two that would have removed what Democrats said were key provisions to boost miner safety.

All three failed, with Bishop voting with his fellow party members.

The bill now heads to the House floor, though no vote has been scheduled. Sen. Edward Kennedy, D-Mass, has introduced a companion bill in the Senate.


INTERNATIONAL DEMAND FOR
INEXPENSIVE COAL SOARS

(Source: Christopher Martin, Bloomberg News, 11/10/07)

Now that the price of coal is at a historic low relative to oil, there's no stopping consumers and producers alike from embracing Al Gore's nightmare.

U.S. coal is so cheap at about $47 a ton that European utilities will pay $50 to ship it across the Atlantic, according to Galbraith's Ltd., a 263-year-old London shipbroker. Although oil and coal cost the same as recently as 1998, West Texas Intermediate crude is five times more expensive after marching toward $100 a barrel this past week.

U.S. coal prices are equal to $1.98 for each million British thermal units of energy, compared with $12.51 for fuel oil and $6.91 for natural gas, data compiled by Bloomberg show. A million British thermal units is the equivalent of eight gallons of gasoline.

Peabody Energy Corp., Consol Energy Inc. and Arch Coal Inc., the three biggest U.S. coal companies, forecast the largest increase in exports in 20 years, degrading the call for a moratorium on coal plants by the former vice president and this year's Nobel Peace Prize winner. Coal use worldwide has grown 27 percent since 2002, three times faster than crude, said BP Plc. The price of U.S. East Coast coal has risen 71 percent in that time, while oil tripled on the New York Mercantile Exchange.

''Coal is by far the cheapest fuel because there's no price [at this point] on how much damage it causes,'' said John Holdren, a Harvard University professor of environmental science and director of the Woods Hole Research Center in Falmouth, Mass.

''There is a huge advantage with coal, and this will continue indefinitely,'' said Gianfilippo Mancini, the head of fuel purchasing for Enel SpA, Italy's largest power company, which is spending $5.8 billion to convert oil-fed plants to run on coal.

Gore said five months ago that the U.S. should adopt a ''complete moratorium'' on new coal-fed power plants unless all of the carbon dioxide from them can be buried underground. Government efforts to subsidize coal as an alternative to oil would be a ''serious mistake,'' he said in a recent interview.

U.S. coal exports to Europe for the first nine months of this year were 11.4 million tons, up 15 percent from the same period in 2006, according to the U.S. Energy Department. Coal generates 41 percent of the world's man-made carbon dioxide emissions, blamed by many (but not all) scientists for the warming of the Earth's climate, Gulf of Mexico hurricanes and rising sea levels.

More than 1,000 coal-fed power plants will be built in the next five years, mostly in China and India, according to the U.S. Department of Energy. China, the world's biggest coal producer, became a net importer for the first time this year, taking supplies from Indonesia, Australia and South Africa and reducing the amount available for Europe.

''If those 1,000 plants get built without any controls on carbon emissions, we will careen into unmanageable changes in our climate,'' the 63-year-old Holdren said in an interview. ''We need to motivate carbon capture and storage through policy. We will still be using coal, but in much smarter ways. It doesn't have to be an economy buster.''

To be sure, proposed U.S. coal plants may not be completed because of regulatory and environmental opposition. Kansas regulators last month rejected a permit for a coal-fueled plant because its carbon emissions were deemed a health hazard.

Coal producers in the U.S. say sales in emerging markets are rising.

''I didn't know how to get coal to Romania a month ago but I do now,'' said Michael McQuillen, chief executive officer of Alpha Natural Resources Inc., the coal miner in Virginia formed by First Reserve Corp., the largest private-equity firm focused on energy assets. Russia, Ukraine and Romania are all looking to buy from the U.S., he said.

U.S. coal exports have increased 37 percent this year and will continue to climb because of record global demand and a weaker dollar, analysts and executives say.

 

SETTING TRAP FOR GLOBAL WARMING
(Source: Brian Maffly and Judy Fahys, Salt Lake Tribune, 11/19/07)

Utah may be about to take center stage in the battle to curb greenhouse emissions.

The U.S. Department of Energy (DOE) plans to spend $67 million over the next decade on a technology solution for climate change that will be tested in Utah. Plans call for pumping carbon dioxide, a greenhouse gas blamed for global warming, into mile-deep rock formations under Carbon County for long-term underground storage.

If this "carbon sequestration" succeeds, it would be like stuffing the climate-change genie back into the bottle. And it would potentially give Utah's energy industry new life, providing huge offsets for the fossil-fuel pollution produced by power plants and energy development and put Utah at the center of efforts to enhance production from old oil fields.

Gov. Jon Huntsman Jr. is expected to formally announce the project this morning at the University of Utah's Energy and Geoscience Institute.

Leading the sequestration project is engineering professor Brian McPherson, who was recruited last year to work for the Utah Research, Science and Technology (USTAR) initiative, the new public-private venture to develop commercial applications for technologies at Utah's two major state universities.

"Dr. McPherson is doing ground-breaking applied research in carbon engineering, and we are extremely excited to have his group and Utah playing a leading role in the commercialization of a technology that has such promise for mitigating CO2 emissions," USTAR executive director Ted McAleer said.

The sequestration project is the product of the Southwest Regional Partnership, which McPherson founded in 2003 to pool the resources of seven energy-producing states to explore ways to keep carbon emissions from power generation out of the atmosphere. As the project's principal investigator, McPherson will direct the science and engineering, while the DOE contracts will remain under the control of the New Mexico Institute of Mining and Technology, McPherson's former employer.

A total of $88 million is being spent on expanding research and testing that is already under way, much of it in abandoned oil and gas fields of the southeastern corner of Utah on and around the Navajo Indian Reservation. But the project holds promise for an area from New Mexico to Montana, where underground, geological basins hold a vast storage potential, perhaps enough capacity to contain 100 years of carbon emissions from major sources, according to a USTAR release.

This new phase is centered in an area called Farnham Dome, east of Wellington. Researchers will compress and nearly liquefy carbon dioxide gas, then inject it into muddy layers of rock about 5,000 feet below the desert surface. The target formation is capped by an impervious layer of shale.

One way to think of this process is by imagining the muddy layer as a roasting pan filled with marbles. The carbon dioxide is pumped into the space between the marbles that is now occupied by salt water, and the salt water oozes back into the surrounding rock. Much of the money for the test project will go to ensuring the injected carbon doesn't leak out and create new environmental problems.

The Farnham Dome is a natural location for such an experiment because it has naturally captured and contained carbon for millions of years. It contains a natural pool of CO2 that formed between 10 and 50 million years ago that was harvested until 1979 to make dry ice and soft drinks.

Utah has been on a crash course to understand and address climate change. Huntsman recently accepted a report from a yearlong task force to look for ways to reduce its impacts on global warming. He also joined California Gov. Arnold Schwarzenegger in signing the Western Climate Initiative, with a goal to reduce greenhouse gas emissions 15 percent regionwide by 2020.

While many Utahns remain skeptical that global warming is a problem worth tackling, many see some value in updating the state's energy strategy, which goes hand in hand with reducing greenhouse gases. One reason is that many believe market-based or government-ordered carbon controls are on the way. Such limits could hurt the fossil fuel industry, but also create new opportunities in energy

USTAR's central role in the Farnham Dome studies will keep Utah near the center of an emerging industry within the energy sector, backers say.

"If the world believes carbon management is an answer to global warming, there will be a lot of companies that own land assets that will explore whether their land is capable of managing carbon," said USTAR's McAleer. "Who are they going to call? They are going to call [those] doing the research for the Department of Energy."

McPherson said sequestration will be a good short-term solution for dealing with climate change as the world shifts to renewable energy sources that are now in their infancy.

"Ultimately, the purpose of this project is to develop a blueprint, a template for commercial scale sequestration associated with new power plants to be built in the region," he said.

McPherson emphasized that the project is a partnership, one with more than 31 participants. Twenty-one industry and university groups have committed to supplement the $67 million in Energy Department money with matching funds totaling $21 million, he said.

Along with the University of Utah, participants include the Utah Geological Survey, Questar Gas, Rocky Mountain Power, Savoy Energy, Blue Source, Pure Energy Corp., the Navajo Nation and the New Mexico Institute of Mining and Technology.

Another possible player is Southern California's Edison, one of the nation's largest utilities, which has sought permission to use ratepayer money to fund a $50 million carbon-management project to explore the feasibility of coal gasification power plant. Using new technology, such a plant's chief byproducts would be liquid carbon dioxide, which would be captured and injected into the ground, and hydrogen, which would be used as fuel, according to Al Walker, who leads technology outreach efforts for USTAR in energy-rich eastern Utah.

Huntsman's energy adviser, Dianne Nielson, told lawmakers Wednesday that sequestration technology like this will help keep Utah coal competitive. If the salt-water formations prove effective at containing man-made carbon, they will serve as carbon sinks that will allow the state to provide a solution to the pollution caused by the gases its power plants and autos produce in a world that most people agree is moving to constraining carbon.

When lawmakers doubted the viability of such technological solutions, Nielson, a geologist, gently disagreed.

"I don't think they are as far out as some people say," she responded.

"We [in Utah] have a leg up on research and development."


TOWER MINE GETS OK TO RESUME OPERATIONS
(Source: Robert Gehrke, Salt Lake Tribune, 11/21/07)

Federal safety regulators have given the go-ahead to resume operations at the Tower mine, where 170 miners have been idled since shortly after the disaster at Crandall Canyon because of concerns about mining coal so deep underground.

"If they get everything in place, they could start up today," said Kevin Stricklin, administrator of coal-mine safety for the Mine Safety and Health Administration (MSHA).

The company is in the process of installing the necessary safety equipment, said Rob Murray, vice president of Murray Energy Corp. and the son of company founder Robert Murray.

"We hope to have the longwall automation completed and the Tower mine operational in early January 2008, at which time we will call back our laid-off employees," Murray said. MSHA approved the longwall mining plan at Tower late last week, after UtahAAmerican Energy Inc., which co-owns both Crandall Canyon and Tower mines, consented to MSHA's safety demands.

Specifically, MSHA required the company to install a longwall mining system that can be operated from a safer distance, working farther from where the longwall machines are shearing coal from the working "face."

"We were concerned about people working on the face area, and we came up with a plan that basically a lot of the work will be done remote-control," Stricklin said.

Murray says that the longwall system being installed is cutting-edge technology.

"The health, safety and overall well-being of our employees is the highest priority to UtahAmerican and Murray Energy Corporation, and we remain committed to restarting the Tower mine and getting our employees back to work at the earliest possible time."

After the Aug. 6 collapse at Crandall Canyon, Murray Energy voluntarily halted work at the Tower mine on Aug. 27. The move left more than 170 workers out of a job; another 11 were laid off from Tower last week.

Murray Energy offered workers jobs at other mines, and some Utah workers relocated.

It took months for MSHA and UtahAmerican to hammer out specifics of the Tower proposal.

There were concerns, Stricklin said, about the depth of the Tower mine.

Records show mining has been done at 2,800 feet below the surface and is projected to reach depths of 3,200 feet, "deeper than any longwall machine has ever successfully been used in the United States," according to The Utah Coal Report, released by the Utah Geological Survey in August.

The Tower mine was doing longwall mining, while at Crandall Canyon miners were conducting retreat mining - a technique in which the thick coal pillars that support the mine are cut away, allowing the roof to fall in.

MSHA, in cooperation with mine operators, imposed a moratorium on retreat mining in deep mines - those at depths greater than 1,500 feet - after the Crandall Canyon collapse. At the time, no mines were doing retreat mining, but six mines had received permission from MSHA to do retreat mining in the future.

 

FEDS TURN OVER MINE PROBE DATA, PHOTOS
(Source: Mike Gorrell, Salt Lake Tribune, 11/21/0)

Federal mine safety officials came to their first formal meeting with the state Tuesday loaded with information about the investigation into the Crandall Canyon mine disaster in August and their agency's broader responses to fallout from the tragedy.

They also brought photos.

Those photographs showed the destruction within the mine tunnel where three rescuers died Aug. 16 while trying to rescue six miners fatally trapped 10 days earlier by a much larger implosion of Crandall Canyon's walls.

Only the bumper of the continuous mining machine being used to excavate a path to the trapped six was visible through splintered chunks of coal piled deep in the tunnel. Strewn about the rubble were twisted pieces of the steel roof supports that had been blown free like pickup sticks when the mine's walls came in, devastating the rescuers and the underground relief effort.

Those images, provided by Richard Gates, head of the federal Mine Safety and Health Administration team investigating Crandall Canyon, clearly illustrated that more lives easily could have been lost in the disaster. And that reinforced to Utah Mine Safety Commission members the need to come up with some substantive recommendations to help the state try to assure that nothing of the kind happens again in its coal mines.

Gates was hesitant to make any recommendations on what the state should do, pending the completion of his team's investigation. Consequently, he never came close to shedding light on his suspicions about what might have been the root cause or causes of what happened at Crandall Canyon. He was even reluctant to give an anticipated completion date for his report, offering only that he did not expect it to take quite as long as the probe into the Sago mine disaster in West Virginia.

That report took nearly a year and a half to finish. But the Sago investigation required lengthy scientific analyses of lightning and its effect on the pressure resistance capacity of underground seals that keep fresh air from mixing with deadly air.

The Crandall Canyon probe will not have such technical demands.

Investigators also will not come close to getting into the area where the missing miners were working. Members of Gates' team made two forays into the mine in mid-September, advancing to the scene of the implosion that killed the rescue workers. Company officials accompanied them part of the way, Gates said, but declined to go the last half-mile up to the working face.

And now the mine's three entry tunnels have been sealed with cinder block walls, indicating there are no imminent plans to return to the area where the miners are entombed. But, MSHA coal mine safety director Kevin Stricklin added, those walls can be removed if future innovations allow a safe return to retrieve the bodies.

With limited on-site inspection possibilities, Gates said his team has conducted formal, yet voluntary, interviews with 63 people knowledgeable about the mine and plans for it, including MSHA personnel in the Price field office and Denver district headquarters, and miners who worked there. More interviews are planned.

U.S. Department of Labor attorney Ed Clair said overtures have been made to talk with Robert Murray, the mine's co-owner, but nothing definite has been set. Murray was subpoenaed last week by a Senate committee also eager to question him about the disaster.

Gates also said he has not yet interviewed any officials with Agapito Associates Inc., the Grand Junction, Colo.-based engineering and mine-planning consultants who did the technical work behind UtahAmerican Energy's plan, approved by MSHA, to cut most of the coal out of the barrier pillars holding up the mountain above the section of the Crandall Canyon mine where the first catastrophic collapse occurred.

But he added that Agapito has supplied investigators with numerous requested documents. Agapito's documents are among 35,000 pages of materials, 250 maps, 1,200 pictures, and hours of video and audio recordings that the investigative team has assembled and continues to analyze.

"We're still requesting more from the company and consultants," Gates said.

Utah Labor Commissioner Sherrie Hayashi, the state's appointed representative on MSHA's investigative team, said she thought one recommendation the Utah Mine Safety Commission could make was for legislation that would automatically make a Labor Commission executive the state's liaison to rescue operations in any future mining disaster.

She and Stricklin also said there is always a need for more training, and Stricklin said MSHA has no problems with Utah re-establishing its own mine-inspection agency, describing what some other states do. But he noted that would require a financial investment.

The Price field office costs about $1.8 million annually to run, he said.

 

UTAHNS BATTLE NEVADA'S PLAN FOR COAL PLANT
(Source: Mark Havnes, Salt Lake Tribune, 11/24/07)

CEDAR CITY - Southwestern Utah residents fear they may get coal for Christmas.

So they are banding together to ask not Santa but regulators to stop a 750-megawatt coal-fired power plant from cranking up 40 miles southwest of St. George near Mesquite, Nev.

Lin Alder, head of Citizens for Dixie's Future, is organizing the drive against the Toquop Energy Project. He said more than 500 Washington County residents already have signed a petition, which will be delivered to Utah's congressional delegation, Gov. Jon Huntsman Jr. and the state attorney general to enlist their opposition.

"We have support across the board," Alder said.

Public comment is being taken until Dec. 11 on a draft environmental impact statement for the proposed $1.3 billion plant.

The Toquop project, being built by Sithe Global Power, originally was permitted as a 1,000-megawatt natural-gas-burning plant to meet increasing demands for electricity in Las Vegas and other areas in booming southern Nevada.

Company spokesman Frank Maisano said gas was abandoned due to high price and demand from competing industries. Instead, coal from northern Wyoming will be used. It is more reliable and available.

Maisano said the proposed plant will tap the latest technology to help reduce pollutants that opponents argue will hurt the health and environment of Washington County.

"Any haze is not likely to drift that far," Maisano said.

But an unconvinced Alder points to flaws in the draft environmental impact study, including:

* Inadequate analysis of the effects from diminished air quality and the impact it could have on the redrock vistas that attract people to the region.

* Health effects on residents from emissions.

* Impact to water quality, including the watershed and increased mercury levels in rivers and reservoirs.

* Short shrifting of alternative renewable-energy sources such as solar and wind power.

* Failure to weigh the effects on global warming.

Even if a final study is approved, the project still needs an air-quality permit from Nevada's Division of Environmental Protection (DEP) before construction can start.

"The DEP probably won't focus on Utah despite the fact we'll pay with our health," Alder said. "So maybe we can get [Huntsman] to influence Nevada to be a good neighbor."

Maisano said he is not surprised by the petition.

"It's a [public-relations] document groups like to use when they don't have good arguments," he said. "They don't worry about power needs, but have blinders on that deny them the reality of the situation."

Maisano insists that foes fail to note the plant's improved technology.

"They have their opinions but their facts are wrong," he said. "This will not be like plants were 40 years ago and to say it is, is like comparing the technology in a 2007 Prius to a 1960s Chevy."

Maisano points to plans for high-efficient boilers and reduced emissions. "We respect concerns [of residents], but their concerns and terror are not shared by all, especially by newcomers."

Michelle Burkett, a Mesquite resident, said many in her Nevada community oppose the plant as well and have started a grass-roots group to fight it.

She says four manufacturing and power plants within a 30-mile radius of the city already are classified as "big emitters" because of pollutants they spit out.

"We're concerned citizens and need to be educated," she said.


FEDS, STATE AGENCY EASE GRUDGES
(Source: Mike Gorrell, Salt Lake Tribune, 11/26/07)

There was a distinct thawing last week in the frosty relations between the state and federal mine safety officials since August's Crandall Canyon mine disaster.

Members of the Utah Mine Safety Commission had expressed resentment at earlier meetings as they were rebuffed in efforts to gain firsthand information from the federal Mine Safety and Health Administration (MSHA) about its investigation into August's Crandall Canyon mine disaster, which killed nine men and injured six others.

But for the most part, the ardor of those feelings diminished with each passing hour of a nearly 5 1/2 -hour presentation on Tuesday by two MSHA officials.

Much of the steam was taken out of the frustration during a PowerPoint presentation by Kevin Stricklin, head of MSHA's coal division. Slide after slide, he responded directly to dozens of written questions posed in advance by the commission regarding its gubernatorial mandate to recommend what the state could do to make its mines safer and to make accident prevention and response more efficient.

Going second, accident investigator Richard Gates did not disclose any secrets from his ongoing probe. But he explained the investigative process in enough detail, and responded generally to enough questions, that commission chairman Scott Matheson publicly praised the MSHA officials for their "investment of time and energy," adding that the day's lengthy interaction compelled him to "want to keep the channels of communication open."

The appearance by Gates, he noted later, "probably would not have occurred several weeks ago. Although the commission would have preferred more information about the investigation than Mr. Gates provided, I appreciated his participation at our meeting and the information he was willing to offer. . . . The meeting set the groundwork for continued collaboration."

Not that all reservations have been set aside.

Commission member David Litvin, the Utah Mining Association president, criticized Stricklin for not addressing the need for individual miners to take responsibility for their own safety and to work with operators on creating a culture of safety. Then he objected to the fact Stricklin said nothing about the relationship between MSHA and mining companies. The MSHA official said he did not disagree with Litvin's points, but that he was responding, as requested, to questions about federal-state relations.

Litvin also fumed about Stricklin's observation that the United Mine Workers of America union could play a role in making mining safer. "Safety is not a union, nonunion issue," he said.

Other commission members, however, had softer words for the MSHA officials.

Former Sen. Jake Garn, who said a week ago that he wished he was still on the Senate appropriations committee so he could cut MSHA's budget until the agency opened up, reflected Tuesday that he was "pleased with the specifics" and details of Stricklin's answers.

State Sen. Mike Dmitrich, a Price resident, praised Stricklin for his "candor." The House member on the commission, Rep. Kay McIff of Richfield, called the presentation "informative."

Some commission misgivings about the secretive nature of MSHA's "law-enforcement investigation" into Crandall Canyon seemed to diminish when Sherrie Hayashi, the Utah Labor Commissioner representing the state on the investigative team, described her federal colleagues as "utmost professionals.

"I want to provide a level of assurance to the governor and the state of the thoroughness of the MSHA investigation," she added. "I want to express my full confidence in the MSHA investigation team."

Hayashi said she supports the commission's gravitation toward the idea of increasing state involvement in training programs and of specifying an individual, presumably someone from the Labor Commission, to be the state's official representative in any future disaster response efforts and investigations.

MSHA would not have a problem with the state's starting an agency that conducts safety inspections or plan reviews, Stricklin said, as long as the approach was cooperative so federal and state mine inspectors did not duplicate each other's actions.

"MSHA is at a mine site only 5 percent of the time. If we can coordinate with a state and increase that to 10 percent, mines are safer," he said. "With proper coordination, state inspectors can help reduce fatalities and injuries."

He suggested basing a Utah mine safety agency on models in Alabama, Kentucky, West Virginia or Pennsylvania, describing each of those states' different approaches. There also are opportunities for a lower level of involvement, such as expanded training, greater participation in mine-rescue contests or the hiring of well-trained specialists who could review roof control or ventilation plans submitted by companies to MSHA.

"We would share information to get your opinion on what was safe," Stricklin said. "Quite frankly, you can't have enough experts at times."

He also expressed interest in working with the state on an enhanced seismic monitoring system that would focus on Utah's coal country. University of Utah Seismograph Stations director Walter Arabasz later told the commission he saw practical value in a fairly inexpensive system that could be established in Price, provided industry supported it up front and took charge of monitoring and analyzing the data.

MSHA is fully behind anything that can be done to identify a potential problem in advance and to avoid another disaster, Stricklin concluded. "If we could turn the clock back and stop Crandall Canyon from happening, we'd do it in a heartbeat."


TARNISHED CROWN: WE SHOULD RE-EVALUATE
DEPENDENCE ON KING COAL
(Source: Tribune Editorial, 11/28/07)

Coal. We don't want to live with it, but we can't seem to live without it.

It's a push-me, pull-you kind of debate. California says it doesn't want any more "dirty" power (produced from coal) and is pulling out as prime customer for a third unit at the Intermountain Power Project near Delta, so Utah municipalities are suing. At the same time, Utahns in St. George want to halt plans for a coal-fired power plant near Mesquite, Nev., that would send electricity to power-hungry Las Vegans.

The contrasting concerns - for a reliable and available power source and for cleaner air and less impact on global warming - are further complicated by the interplay among states. Everybody wants cheap electricity, but there is a growing concern about the emissions from coal-fired plants that don't remain within the state where they're produced, but drift across the region.

The conflicts underline the need for wide-scale development of clean alternative energy sources - solar, wind, geothermal - and easing away from coal.

The first two units of the IPP plant sold 75 percent of their power to Los Angeles and five other California cities. If those cities put the kabosh on the third unit, the 23 Utah cities that buy the other 25 percent won't get power they say they need.

Meanwhile, residents of southwestern Utah complain that the Toquop Energy Project in Nevada would muddy the air, erode water quality and harm their health.

Representatives for both plants say they will utilize the latest technology to reduce pollutants, but, knowing what we know about the global effects of human-caused climate change and fine-particulate pollution, that's not enough. Coal-fired plants spew potentially dangerous mercury, nitrogen-oxide, sulfur-dioxide, and global warming Enemy No. 1 - carbon dioxide. Developing technology to inject CO2 back into the Earth is expensive and years from commercial application.

In the meantime, coal is still plentiful in the booming West; indeed, more than 70 percent of Utah's electricity comes from coal-fired plants. The World Energy Council estimates electricity consumption worldwide will double by 2030 and demand for coal could rise 60 percent.

That rate of consumption must be scaled back dramatically if we are to have any chance of slowing the rapid rise of global temperatures that are shrinking ice caps at both poles. Coal may still be king, but its crown gathers more tarnish every day.

 


ENERGY

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RECURRING NIGHTMARE:
NUCLEAR POWER IS BACK WITH A BANG

(Source: Jane Goetze, High Country News, 11/1/07)

Blind faith in nuclear power overseas, growing resistance to coal-fired power plants, and skyrocketing oil prices have driven uranium prices up and resurrected a half-dead market. President Bush calls it the cleanest, safest energy in the world.

We were duped once before and paid dearly for our short-sightedness. The radioactive dust still hasn't settled from the uranium boom during the Cold War that left an estimated 3,500 dead from lung diseases and a trail of waste sites, including 130 acres of toxic tailings along the Colorado River in Moab. While we're cleaning up that mess and others like it, what will we do about new radioactive waste produced by our insatiable appetite for energy?

It might help to remember that we are all in this together and that there are lessons to be learned from recent history and the testimony of survivors. The crushing of raw ore produced a mushroom cloud of dust, though workers couldn't see the dust that penetrated their lungs.

They went home in their work clothes, looking like they'd been dipped in yellow flour. Bathing made them look human again, but next morning their vacated pillows bore the yellow, radioactive imprint of the backs of their skulls. After the laundry was done, handfuls of yellow dust had to be scooped from the bottom of washing tubs, and one widow recalls scattering the free mulch over her vegetable garden. This was in the 1950s and 1960s, before the federal government mandated safety regulations.

The vast majority of workers were never informed of the risks. Twenty years after their exposure, some were diagnosed with lymphatic cancer, emphysema, silicosis or some other terminal illness. When American uranium miners and millers on the sparsely populated Colorado Plateau succumbed to lung diseases, cigarettes were labeled the culprit, despite low smoking rates among the predominantly Navajo and Mormon workers.

America's Cold War mentality cocooned in secrecy the industry's watchdog and promoter, the Atomic Energy Commission, and granted it unprecedented power to corner the uranium market. The federal government entrusted the safety of miners to the states. Records that could have been released in the 1950s to verify the fears of Public Health Service doctors were withheld from outsiders. Ignorant of the risks, miners worked until the boom went bust, or their health failed.

The diseases of the uranium industry did not discriminate. Reservation Indian, itinerant Anglo, fourth-generation Utah Mormon - a sick worker could be fired without notice, severance and disability pay. If the diagnosis was lung cancer, the patient might have two or three months to settle his affairs.

It took more than 20 years of denied workman's compensation claims, anger-filled public meetings, failed lawsuits, lost appeals, and more angry meetings before Congress finally acknowledged the documented medical claims of underground miners, nuclear test-site workers and "downwinders," passing the Radiation Exposure Compensation Act in 1990.

But the required documentation excluded widows of Navajo miners who could produce no marriage certificates from tribal wedding ceremonies. Millers, surface miners, truck haulers and underground miners who began working after the enactment of health and safety regulations in 1970 were not covered at all. Neither were families whose houses were built on radioactive foundations, whose water supply was contaminated, or whose children played in the tailings.

Finally, in 2000, the testimony of two Utah State University sociologists and the victims they interviewed helped convince Congress to amend the 1990 act and extend coverage to surface miners, millers and truck haulers, and take into account cultural differences. But proving their case after the passage of so many years has proven challenging, or fruitless.

Proponents of nuclear power today assure us that federal mining regulations will protect workers. Before we swallow that promise, let's figure out a way to take care of the waste from the previous boom and bury the rest of the dead. We failed to heed the advice of the traditional healers of the Navajo Nation the first time, and what they had to say then is just as relevant today: "If you disturb the land, terrible illnesses will happen in retribution. Disrupting one part of your life knocks the whole system off balance."

 

UTAH NUCLEAR POWER PROPOSAL
ECHO OF SIMILAR, ABANDONED PLAN

(Robert Gehrke, Salt Lake Tribune, 11/2/07)

A quarter of a century before Rep. Aaron Tilton and his company contemplated gett- ing a license to build a nuclear power plant along the Green River, state and federal energy officials looked at the location as the possible home to as many as nine reactors to power much of the West.

The U.S. Department of Energy, and state and regional energy officials, spent four years and $1 million studying the possibility of building nine nuclear reactors at Horse Bench, about 15 miles south of the town of Green River in Emery County.

The study said the project was technically feasible, but it also identified several obstacles. Turns out those problems are similar to those Tilton and his company, Transition Power Development LLC, face today - primarily the scarcity of water, as well as public resistance and the difficulty of financing such projects.

Tilton, who says he has heard about the study but has not seen it, recognizes his project faces several of the same hurdles, not the least of which is the cost.

"With any project of any size or significance, that's going to be the issue," the CEO said, but he's not putting too much stock in the 1982 Energy Department findings. "We've taken the approach we have to start from scratch."

A contract that Transition Power signed in September with Kane County Water Conservancy District identified the Green River in Emery County as the source for 30,000 acre-feet a year of water that it would use to cool its nuclear reactors.

Tilton says two consulting groups are studying at least five options in the eastern part of the state and could apply to take water out of the Green or Colorado rivers near those locales.

Transition Power President Tom Retson said the company has developed a scoring system to evaluate each location. He said that, on early site visits, the officers in the company ran into locals who remembered the state's earlier flirtation with nuclear power.

"When we were visiting individual sites or potential sites or areas of the state, people we met made comments - I won't call them old-timers - they said, 'Oh, you guys are back,' '' Retson said.

In 1978, in the midst of the last major energy crisis, the Energy Department commissioned a study that identified seven potential locations in the West that could be home to the cluster of power plants, including the Horse Bench site between the Green and San Rafael rivers.

Advisers to then-Gov. Scott Matheson encouraged him to have the state explore the idea further, and Matheson consented after a public hearing in Green River drew broad support, according to an article in The Salt Lake Tribune at the time.

One of those Matheson staffers was Reed Searle, who was director of the Utah Energy Office when the study started and now is the executive director of the Intermountain Power Agency, which provides coal-generated electricity mainly to California. Searle is leaving the IPA to join Transition Power.

The cluster of nine power plants was projected to generate 11,250 megawatts of power and be built between 1995 and 2013 at a cost, at the time, of $12 billion. Another $2.5 billion was estimated for needed transmission lines.

The Energy Department hired Oak Ridge National Laboratory, which drew on state and Western officials and utility companies to produce a 15-volume report that highlighted many advantages to the Green River site. Among those pluses were access to water, a work force, transportation, transmission lines and a geologically stable location.

At its peak, the project was forecast to create 12,400 jobs, but it would need 126,630 acre-feet of water per year. Steam plumes would be seen from Canyonlands National Park, about 30 miles away.

Similar studies were done looking at building the complex at Hanford, Wash., and at Lake Hartwell, S.C.

But, shortly after the Energy Department initiated the study, the United States suffered its worst nuclear accident in history at Three Mile Island in Pennsylvania. That, coupled with dropping energy prices, led to a general disillusionment with nuclear power nationally.

"Nuclear energy just started being of less interest to utilities," Searle said. "I guess the utilities didn't bite."


MOAB URANIUM WASTE:
TAILINGS TAB HEADS CLOSER TO $1 BILLION

(Source: Judy Fahys, Salt Lake Tribune, 11/3/07)

MOAB - The cost to clean up uranium waste on the Colorado River's edge has shot up.

The U.S. Energy Department said its new estimate for removing the tailings is $635 million to $835 million.

"This is a more realistic estimate," said DOE's Don Metzler, who oversees the cleanup, on Friday.

The Energy Department is removing 16 million tons of tailings from the site, about three miles from Moab, to stop chemicals like ammonia from seeping into the Colorado River. The river is home to several protected fish species and serves as an important water source to more than 25 million people downstream.

Previously, the price tag reached $697 million. Metzler suggested to the state Radiation Control Board that a new, longer timeline boosted the price. "If you push out the project 10 years, it's more expensive," he said.

The Energy Department awarded a contract for $98.4 million this spring to begin hauling the 16 million tons of uranium-mill waste 32 miles north to Crescent Junction. And construction has already started on a 250-acre landfill for the contaminated waste.

"It's surprising," said Joette Langianese, a member of the Grand County Council and the radiation board. "I don't know why it has gone up so high, whether it's higher fuel costs, construction costs."

The county, the state and Utah members of Congress are urging the Energy Department to step up the cleanup, bringing it back in line with a previous schedule that would have the job done by 2019 rather than the current projection of 2028. A bill in Congress seeks the quicker cleanup, but the House and Senate have yet to finalize the change.

Metzler said he didn't expect there to be any short-term delays in the cleanup even if Congress fails to pass the spending bill. Working off of last year's funding schedule, plus $16 million carried over from last year, will be plenty to keep going, he told the board.

Meanwhile, progress continues to be made. Metzler reported that 73 acres already has been cleaned up and 60 revegetated.

Also, the Energy Department said it has pumped 100 million gallons of contaminated water from the pile. The Energy Department says this volume is comparable to 151 six-foot deep, Olympic-sized swimming pools.

They have captured 449,250 pounds of ammonia and 19,000 pounds of uranium through special extraction/injection wells placed between the pile and the Colorado River.

 

UTAH SPLIT ON NUKE POWER
(Source: Judy Fahys, Salt Lake Tribune, 11/12/07)

Green River resident Nancy Dunham wouldn't mind having safe, clean nuclear power plants in the neighborhood to energize the local economy.

But Moab resident Sarah Fields doubts reactors will fly because they are water hogs and will bring more waste into an area already riddled with the dangerous stuff.

The two views illustrate Utah's split on the nuclear power plant issue, according to a new opinion poll by The Salt Lake Tribune.

About as many Utahns would welcome having nuclear-power plants in the state as those who would oppose reactors, respondents say.

Forty-three percent favor construction of nuclear plants in their state and 42 percent object.

Mason-Dixon Polling & Research of Washington, D.C., conducted the newspaper's telephone poll of 625 likely voters from throughout the state Oct. 29-31. It has a margin of error of about 4 percent.

The findings come just weeks after most Utahns learned about efforts by two legislators, Republican Reps. Aaron Tilton of Springville and Mike Noel of Kanab, to locate two reactors near Green River, Emery County. They would be Utah's first nuclear plants.

If the plans go forward, the Utah reactors would be among nearly two dozen on the U.S. Nuclear Regulatory Commission's schedule of license reviews for new plants.

The news has gotten people talking about nuclear energy in Emery County, and Grand County downstream. And everyone seems to agree on one point: People want specifics.

Safety, water use and economic benefits - they are all questions that need answers, says Dunham, a 76-year-old who has lived in the area for more than a half-century, raised six children there and whose family supplied mining equipment during the southeastern Utah uranium boom.

"People need to understand the whole process and what it does to their environment," she says.

"So far as radiation goes, I personally have no problems with it," adds Dunham, who once visited a reactor in Wisconsin. "It's clean power, and it's coming."

A number of Green River residents suspect it may be just another get-jobs-quick idea that collapses before any good can come of it.

"I think it's just a lot of talk," says Duane Riches, 45, who owns the Melon Vine Food Store with his wife, Penney .

"I'm not saying it's good or bad, because I don't know much about nuclear power. But I don't see it happening, so I'm not worried about it." Adds Penney: "I heard a couple of locals say it'll be fine: our grandkids will just glow in the dark."

Rafting outfitter Bob Quist agreed that too many fly-by-night proposals have roused this community of 900, then dashed its high hopes for economic vitality. "What I would call it is a lot of hype," says the longtime Green River resident. "Just another - what can you say? - boondoggle."

He recalls the community uproar over a nuclear plant more than two decades ago that evaporated after millions of dollars and lots of local goodwill had been spent on it. Quist says he would probably fight it again - because of the impact on the community's resources - even though he's not opposed to nuclear energy.

Behind the desk of the Green River golf course, former Mayor Glen Dale Johnson says he would like to see a nuclear plant come to the community and bring a bigger payroll. With the city's annual budget of about $1 million, and lacking a property tax, leaders need new resources to fund improvements and services.

"We've been promised a lot," he says, noting that proposals for a refinery and other businesses have failed in the past. "And maybe this time we can make it happen."

Green River resident Barbara King is against it. A member of the Sierra Club, she says reactors will mar the scenic beauty so crucial to the local economy that caters to people visiting the San Rafael Swell, Arches National Park and Canyonlands National Park. "It's my neighborhood," she says. "It's a beautiful area, and [a reactor] would be an eyesore."

A newly formed environmental group based in Moab, Uranium Watch, has begun to put the proposed reactors in its cross hairs. Members are drafting an opposition letter to Gov. Jon Huntsman Jr. and state legislators, said Fields, a Moab resident who is organizing the group. "This is not going to fly," she says.

Moab is the scene of a U.S. Energy Department cleanup of uranium tailings that is projected to cost as much as $835 million and last for two decades.

And it is upstream of a uranium processing plant that some have accused of "sham disposal" of radiation-contaminated waste.

Uranium Watch is concerned about the proposed reactors' water use, on-site waste storage, endangered species in the Colorado River, electric transmission lines and other issues that will come up as the public considers the proposal.

"Here we are trying to get rid of nuclear waste and they [the reactor proponents] want to come in," says Uranium Watch member John Weisheit.

Grand County Council member Joette Langianese predicted her community would "respond vocally" to the new reactor proposal.

"It will be a very controversial issue for Grand County," she says, "one way or the other."

 

GOVERNOR TO APPOINT PANEL TO SHARPEN PROPOSALS
(Source: Judy Fahys, Salt Lake Tribune, 11/11/07)

Look for a new task force in the next few weeks to sharpen proposals for putting renewable energy to work in Utah.

Gov. Jon Huntsman Jr. said he is appointing a new advisory panel to vet the 23 energy-saving options recommended last month by the Blue Ribbon Advisory Council on Climate Change, as well as the group's suggestions for reducing Utah's output of the pollution that contributes to global warming.

"We're not done by any means," said Huntsman, who signed Utah onto the Western Climate Initiative this summer.

The new group will advise Huntsman on what projects - such as updating building codes for homes, business and government - should be tackled first.

And it will suggest what needs to be done to accommodate the improvements, such as enacting legislation or providing funding.

The governor has set a goal of cutting greenhouse gases 20 percent in Utah by 2015.

Utahns, their businesses and government pumped about 69 million metric tons of those gases into the atmosphere in 2005, or about 1 percent of the nation's gross emissions.

Huntsman's energy adviser, Dianne Nielson, said there would be many side benefits to improved energy efficiency, including economic savings, new jobs and cleaner air.

"We need to bring some priorities to this now," she said.

Park City Mayor Dana Williams pointed out that many Utahns are interested in the benefits that energy efficiency offers. He said 40 ranchers in Summit County, for instance, are curious about a proposed program to develop wind farms.

"It doesn't matter if you believe in global warming or not," he said. "It affects your bottom line."

For more information about the climate-change group and their energy-efficiency ideas, see the Web page at www.deq.utah.gov/BRAC_Climate/final_report.htm

 

UTAH, L.A. POWER TIFF HEATS UP
(Source: Steven Oberbeck, Salt Lake Tribune, 11/23/07)

A simmering dispute that has threatened to pit California's concerns about global warming against the growing demand for more electricity in Utah is erupting into a full-scale conflict.

The Utah Associated Municipal Power System (UAMPS), which represents 23 Utah cities that operate their own electric utilities, is squaring off against the Los Angeles Department of Water and Power over its refusal to allow a third generating unit to be built at the Intermountain Power Project in Utah.

In a lawsuit in Utah's 3rd District Court, the municipalities contend that Los Angeles Power initially approved development of another unit at the massive coal-fired facility near Delta but now is exerting its control over the plant's operator - the Intermountain Power Agency - to block its development.

"Los Angeles Power initially was involved in helping plan for the development of a third unit," said Matthew McNulty, an attorney with VanCott Bagley, Cornwall and McCarthy in Salt Lake City who is representing UAMPS. "Now that they don't want to be involved, we don't think they should have veto power over a Utah project."

UAMPS estimates it spent more than $6.4 million pursuing the development of the third generating unit before L.A. Power figuratively pulled the plug.

Los Angeles and five other California cities take 75 percent of the electricity generated at the Intermountain Power Project. As a result, their votes at the Intermountain Power Agency far outweigh those of the 23 Utah municipalities.

UAMPS' complaint may not be the only lawsuit that emerges from the dispute.

Rocky Mountain Power, which takes about 4 percent of the electricity generated at the Intermountain Power Project and favors the development of a third generating unit, in July notified Los Angeles Power and the Intermountain Power Agency that it might file a lawsuit if the project wasn't allowed to go forward.

At that time, the utility that provides most Utahns with the electricity to operate the appliances in their homes indicated that it considered it improper for those California cities - Los Angeles, Pasadena, Anaheim, Burbank, Glendale and Riverside - to block needed generating capacity in Utah to satisfy California environmental laws.

"We're continuing to weigh our options, and filing a lawsuit against the Los Angeles Department of Water and Power and IPA remains a viable possibility," said Rocky Mountain Power spokesman Jeff Hymas.

Los Angeles Power spokesman Joe Ramallo declined to comment on pending litigation. However, in July he noted that the Southern California department announced in 2003 that it wasn't going to buy any more electricity generated from coal.

"We're committed that 20 percent of the power we provide will come from renewable resources by 2010 and 35 percent by 2025," Ramallo said at that time. "Right now, we're at 9 percent and climbing."

The Utah municipalities believe that California's Global Warming Solutions Act of 2006, which set up a statewide program to cap all greenhouse gas emissions from major industries in California, played a role in Los Angeles throwing up barriers against the development of a third unit at the Intermountain Power Project.

"Although neither Los Angeles Power nor IPA has ever cited the California Act formally or in writing as a roadblock to the development of Unit 3, the California Act has been a palpable, albeit inconsistent, undercurrent since late 2006," UAMPS' lawsuit states.

UAMPS' complaint is asking for damages from the Intermountain Power Agency and Los Angeles Power for lost profits and an order requiring Los Angeles Power to negotiate in good faith toward the completing a development agreement.

 



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CHEAP IMPORTS COME WITH DEADLY ENVIRONMENTAL PRICE TAG
(Source: Brian Moench*, Salt Lake Tribune, 11/10/07)

The Salt Lake Tribune's recent series of stories on the health consequences to Chinese workers of their country's industrial boom was an excellent reminder of how important in-depth journalism is to a free society. However, an even more important element to this story is the collateral damage inflicted upon the American West and the rest of the world by Chinese industry.

The Asian Brown Cloud, or ABC as it is known to climate scientists, is a two-mile-thick toxic umbrella that covers much of East Asia and is wafted across the Pacific Ocean to the West Coast, eventually making its way to Utah and beyond. This cloud is mostly pollution from Asian industries; the remainder is dust from Mongolian deserts.

A major contributor to the ABC is the exploding network of coal-fired power plants in Asia. China is building two per week, most with minimal pollution-control equipment. The Chinese people are the most seriously victimized. But the pollution from Asia circles the entire globe within two weeks, depositing along the way sulfur dioxide, nitrogen oxides, particulate matter, mercury, and more radioactive particles than all the world's nuclear power plants combined.

This year, China's coal-fired plants became the world's largest single source of carbon-dioxide emissions. During some months, 80 percent of the particulate matter over the West Coast comes from Asia. Last year, summer ozone levels in once-pristine Canyonlands National Park were almost as high as those in Bountiful.

Before we allow ourselves to be overcome with righteous indignation, we should remember that the United States has spent decades polluting our own and everyone else's air and, until recently, has accounted for the lion's share of the greenhouse-gas emissions that are the biggest contributor to global warming.

We also bear a large part of the responsibility for China's soaring air pollution. By allowing American corporations to move our manufacturing base overseas, we have exported much of our carbon footprint and air-polluting ways to China, with its cheap labor, sparse regulations and potential for higher profits. Corporate disregard for the environment has been an important part of the profit-taking.

But now, in a painfully ironic twist, we are importing the pollution that our corporations turned a blind eye to

in the first place, whether it's lead-painted Barbies, mercury-tainted air or a suffocating atmosphere of CO2. Cheap Chinese products are carrying a deadly sticker shock, courtesy of the prevailing free-market wisdom.

The proliferation of primitive power plants in China and India is becoming the pivotal battlefield in efforts to curb air pollution and slow global warming. But if Utah and the rest of the states don't clean up our own sources of pollution and CO2, and refrain from adding new ones, how can we expect other countries to do so?

Two weeks ago my sister's family fled their home in San Diego with only the clothes on their backs as 100-foot flames closed in. Their neighbors are now homeless. The smoke from those fires spread across the West, adding to our own pollution and whatever we import from China. Climate scientists, who have been warning us for years that global warming would make this kind of disaster commonplace, now predict the West will lose half its forests to fire, heat and drought.

Those politicians who continue to craft public policy in defiance of these realities pose a clear and present danger to us all.
---
* Brian Moench is president of Utah Physicians for a Healthy Environment.



LEGISLATIVE & TAX

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KING WILL LEAD UTAH'S 'LOYAL OPPOSITION'
(Robert Gehrke, Salt Lake Tribune, 11/14/2007)

Utah's Democratic House members picked Rep. Brad King to replace Salt Lake City Mayor-elect Ralph Becker as the party's leader in the chamber for the 2008 legislative session.

King is a moderate Democrat from Price, one of the few areas of the state solidly controlled by the minority party. His district includes San Juan County and parts of Carbon, Emery and Grand counties.

He said his priorities in the coming year are advancing the party's views on health care and education and working to increase the number of Democrats in the Legislature after the 2008 election. He said work is already under way to recruit quality candidates.

"We are the loyal opposition and that gives us some responsibility to represent those who don't have a voice and to remind our [Republican] colleagues of our priorities, things that perhaps they overlook," King said.

King is vice president of institutional advancement and student services at the College of Eastern Utah in Price. He has been in the Legislature since 1997, served as minority whip in the last session and served on the Executive Appropriations Committee.

The Democratic caucus met for more than 90 minutes Monday evening before selecting King over Rep. Karen Morgan, D-Cottonwood Heights, a homemaker and former school teacher.

The Democratic leadership team includes Rep. David Litvack of Salt Lake City as minority whip; Rep. Carol Spackman Moss of Holladay, who is retaining her position as assistant minority whip; and Rep. Phil Riesen of Holladay, who succeeds Litvack as caucus manager.

Becker's replacement in the Legislature will be named by the end of the year, King said.

King acknowledged that Democrats are outnumbered - Republicans hold a 55-20 majority in the House. But, he said, "when the issues are on your side and the people are with you, things are easy."

 


ECONOMY

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SHOPPERS ARE CUTTING BACK
(Source: Martin Crutsinger, The Associated Press, 11/1/07)

WASHINGTON - The growth in consumer spending slowed to a crawl in September as shoppers, worried about a deepening housing downturn, stayed away from the malls.

A gauge of manufacturing activity slipped close to recession levels last month.

The latest economic data are likely signaling that a sharp slowdown is under way over the next two quarters as the housing slump, a severe credit crunch and now rising energy prices take a toll on economic growth, analysts said.

The Commerce Department reported Thursday that consumer spending rose by 0.3 percent in September, the smallest rise in three months and lower than the 0.4 percent increase analysts expected. The 0.4 percent gain in incomes was in line with expectations.

In another report, the Institute for Supply Management, an Arizona-based trade group, said its manufacturing index dipped to 50.9 in October, which was the weakest level since March and the fourth consecutive month that manufacturing has slowed.

The September reading had been 52 and analysts had expected a slightly stronger 51.8 for October. Any reading lower than 50 indicates that the manufacturing portion of the economy is in recession.

The worse-than-expected economic news sent stocks sharply lower. Investors grappled with evidence that the economy is slowing. At the same time, the Federal Reserve indicated that this week's interest rate cut, the second in two months, may be all the relief it plans to deliver, given a rising inflation threat from rapidly rising oil prices.

The Dow Jones industrial average fell 362.14 points to close at 13,567.87.

The government reported on Wednesday that the economy surged ahead at an annual rate of 3.9 percent in the July-September quarter. But economists believe all the current problems will slash that growth rate to 2 percent or less in the current quarter and the first three months of 2008.

That is expected to be the period of greatest danger when the current expansion, which celebrates its sixth birthday this month, could slip into a recession. The worry is that consumer spending, which accounts for two-thirds of total economic activity, will retreat further as worried consumers cut back on purchases.

''Consumers are becoming increasingly cautious because of the recession in housing, rising gasoline prices and a somewhat softer job market,'' said Mark Zandi, chief economist at Moody's Economy.com.

The news about inflation from the consumer spending report was generally good. Prices paid by consumers on the Fed's preferred inflation gauge rose 0.2 percent in September, excluding food and energy. This measure is up 1.8 percent over the past 12 months, the fourth straight month that it has been within the Fed's comfort zone of 1 percent to 2 percent increases in core inflation.

The Labor Department reported that the number of newly laid-off workers filing claims for unemployment benefits dropped by 6,000 last week to 327,000. But the four-week average for claims climbed by 1,750 to 327,000, a six-month high. Analysts are looking for unemployment to rise in coming months as employers increase layoffs and scale back hiring plans in the face of the slowing economy.

 

TIME WILL TELL HOW OIL PRICES
WILL AFFECT ECONOMY OVERALL

(Dan Caterinicchia, The Associated Press, 11/1/07)

WASHINGTON - As oil prices climb toward the once unthinkable $100-a-barrel level, fears that the U.S. economy could tip into recession are also rising.

To spur spending and borrowing, the Federal Reserve on Wednesday cut a key short-term interest rate for the second time in two months. This, even after the economy grew at a respectable 3.9 percent annual rate in the third quarter and fuel demand continues to rise. So what gives?

Anxiety-inducing headlines can cloud reality, analysts said, especially when it comes to a critical commodity such as oil, whose economic effects are best measured over time. Through October, the average per-barrel cost of oil is only 1.3 percent higher than during the same period in 2006, and motorists have paid just 3 percent more per gallon on average at the pump.

To be sure, the strain of higher oil prices is being felt, particularly among fuel-intensive businesses and poorer Americans, who spend a higher percentage of their income on energy than the rest of the population. But the recent surge in oil prices comes on the heels of a multiyear run-up, and that has given the overall economy time to adapt, analysts said.

Oil prices - which zipped past $96 per barrel Thursday - would need to surpass $100 a barrel and remain at that level for at least two weeks or more to inflict widespread and lasting economic damage, says Tyson Slocum, director of the energy program at consumer group Public Citizen in Washington.

''Short little jumps aren't going to do it. It will have to be sustained over time,'' he added.

Fortunately, the consensus view on Wall Street is chances are slim that oil will surpass $100 a barrel and stick for any length of time.

A severe housing slump and attention-getting credit crunch are tapering U.S. economic growth, which will trim energy demand and bring prices down to around $70 to $80 a barrel, predicts Fimat analyst Antoine Halff.

''The spike we see currently doesn't have too much staying power,'' Halff said.

All bets are off if tensions between the U.S. and Iran escalate, he adds.

But even a snapshot of today's prices compared with prices at the same time a year ago is psychologically alarming.

Crude oil prices hit a record overnight Thursday after the U.S. reported a surprisingly large drop in inventories. Light, sweet crude for December delivery fell $1.04 to settle at $93.49 a barrel on the New York Mercantile Exchange after rising as high as $96.24, a new trading high, overnight. That compares with $58.71 a barrel on the same day last year.

At a nationwide average of $2.91 a gallon, gasoline prices are well above the year-ago average of $2.21 per gallon at this time, according to AAA and the Oil Price Information Service. Prices of the motor fuel usually fall sharply after Labor Day, but this year they have risen about 8 cents per gallon since summer's end.

However, looking beyond the day's headlines is revealing and comforting - from an economic perspective. The average per-barrel price of crude on the New York Mercantile Exchange through Oct. 30 was $68.22, compared with $67.34 over the same period in 2006, according to Energy Department data.

Consumers are changing their behavior in response to higher prices at the pump. Sales of hybrid vehicles and energy-efficient compact cars are expected to set records this year, while sales of gas-guzzling pickup trucks and SUVs have declined.

Jason Shogren, a professor of economics at the University of Wyoming, said the U.S. economy has held steady when oil prices increased in recent years because the price changes were gradual.


U.S. HOME FORECLOSURES SKYROCKET
(Source: Alex Veiga, The Associated Press, 11/1/07)

LOS ANGELES - A soaring number of U.S. homeowners struggled to make mortgage payments in the third quarter, with only Utah and four other states reporting no increase in foreclosures compared with last year, a mortgage data company said Thursday.

A total of 446,726 homes nationwide were targeted by some sort of foreclosure activity from July to September, up 100.1 percent from 223,233 properties in the year-ago period, according to Irvine-based RealtyTrac Inc.

The current figure was 33.9 percent higher than the 333,731 properties in foreclosure in the second quarter of this year.

There was one foreclosure filing for every 196 households in the nation during the most recent quarter, RealtyTrac said.

All but five states - including Utah - reported a year-over-year increase in foreclosure filings, which include notices of default, auction sale notices or bank repossessions, the company said.

Utah, which ranked 20th among all states in foreclosures, had one filing for every 402 households, significantly less than the U.S. rate of one for every 196 households.

A single property can sometimes receive more than one notice in a three-month period.

In all, 635,159 filings were reported in the third quarter, up 99.5 percent from the year-ago quarter and up 30 percent from the second quarter of this year.

Utah had 2,173 filings in the third quarter, down nearly 34 percent from the same quarter last year and down 2.4 percent from the second quarter of this year.

Foreclosure filings are considered a somewhat lagging economic indicator, meaning that Utah's favorable numbers reflect the real estate boom of recent years, when the values of many homes jumped in value. Strong appreciation makes it more likely a homeowner could sell their home at a price that covers their mortgage obligations in a timely manner and less likely that they would simply walk away from their homes.

Home sales and appreciation in Utah have slowed considerably in recent months, though, which would likely show up in the data in the coming years.

RealtyTrac CEO James Saccacio said in a statement that nationwide, August and September accounted for the highest monthly totals since the company began issuing foreclosure filing reports in January 2005.

''Given the number of loans due to reset through the middle of 2008, and the continuing weakness in home sales, we would expect foreclosure activity to remain high and even increase over the next year in many markets,'' he said.

Mortgage lenders are bracing for a flood of defaults as many adjustable-rate mortgages originated in 2005 and 2006 during the height of the housing market frenzy reset to higher interest rates.

The loans were initially attractive options for buyers because of their cheaper ''teaser'' interest rates that kept monthly payments low, but even a small percentage increase can translate into a far higher payment.

With home sales in decline and prices down or flat in many regions, more homeowners are landing in foreclosure because they can't afford to sell their homes after falling behind on payments.

The three states with the highest foreclosure rates during the third quarter were Nevada, California and Florida, RealtyTrac said.

Nevada reported one foreclosure filing for every 61 households, with 16,817 filings on 12,982 properties.

That marked a 22.8 percent increase in filings from the previous quarter and a tripling from the year-ago quarter.

California led the nation in total foreclosure filings and reported one filing for every 88 households.

The state had 148,147 filings on 94,772 properties, an increase in filings of 36 percent from the previous quarter and nearly four times more than the year-ago period.

In Florida, there were 86,465 foreclosure filings on 60,992 properties during the third quarter, RealtyTrac said. Foreclosure filings rose 51.5 percent from the previous quarter and more than doubled from the same quarter last year.

Florida's foreclosure rate amounted to one filing for every 95 households, RealtyTrac said.

Rounding out the top 10 states in foreclosure rates were Michigan, Ohio, Colorado, Arizona, Georgia, Indiana and Texas.

 

FEDERAL RESERVE INJECTS $41 BILLION INTO SYSTEM
(Source: Salt Lake Tribune, 11/2/07)

The Federal Reserve pumped $41 billion into the U.S. financial system Thursday, one of its largest cash infusions to help companies get through a credit crunch that took a turn for the worse in August.

The Federal Reserve Bank of New York, which carries out the central bank's open market operations, moved Thursday to inject $41 billion in temporary reserves into the U.S financial system.

It was an action designed to ensure that the markets - which have suffered through a period of turbulence over the last few months - function smoothly. The cash infusion came in three separate operations.

The action comes one day after the Fed sliced a key interest rate for the second time in six weeks to protect the economy from the ill effects of collapse in the housing market, aggravated by the credit troubles.

 

BERNANKE SEES
SLOW GROWTH IN COMING MONTHS

(Source: Martin Crutsinger, The Associated Press, 11/8/07)

WASHINGTON - Federal Reserve Chairman Ben Bernanke said Thursday that economic growth will slow noticeably in coming months while surging oil costs will raise inflation pressures. But he said the economy is nowhere close to the stagflation nightmare of the 1970s and he predicted an economic rebound by mid-2008.

Testifying before the Joint Economic Committee, Bernanke acknowledged a host of problems facing the economy, from a deeper-than-expected housing slump to a lingering credit crunch and now sharply rising oil prices and a falling value of the dollar, both of which increase inflation threats.

Bernanke stressed that the central bank, which has cut a key interest rate twice over the past two months, was closely watching developments and would be prepared to respond as needed. However, he stressed that the central bank believes economic risks are roughly balanced at present between the threat of weaker growth and higher inflation.

That was the stance the Fed took last week when it trimmed its federal funds rate, the interest banks charge each other, by a quarter-point to 4.5 percent following a bolder half-point cut in September.

The Fed sent a clear signal that last week's rate cut may be all that is needed to deal with the economy's problems, a disclosure that sent financial markets into a slump that has deepened as a number of corporate giants - including General Motors, Citicorp and Merrill Lynch - have announced huge losses in recent days.

''The stock market had been hoping that the Fed chairman would hold out some promise of another rate cut but instead, he emphasized the risks of inflation,'' said David Jones, chief economist at DMJ Advisors.

After falling by as much as 200 points, the Dow Jones industrial average closed out another difficult trading session down 33.73 points at 13,266.29. That decline followed a 360.92-point plunge on Wednesday, which had been the third drop of more than 350 points in the past month.

Economists said Bernanke's noncommittal tone on further rate cuts could have been influenced by worries about a sharp plunge in the value of the dollar against other currencies, a fall that has accelerated since the Fed began cutting rates. Lower U.S. interest rates make foreigners less interested in holding dollar-denominated assets such as stocks and bonds.

But many analysts said they were still looking for the central bank to cut rates again in December or January, because they believe the economy will have slowed so much by that time that the Fed will need to boost activity to prevent a recession.

''Bernanke may not have his finger on the easing trigger, but he likely won't hesitate to squeeze again if . . . the economy weakens more than anticipated,'' said Sal Guatieri, senior economist at BMO Capital Markets.

Bernanke said he and his colleagues believe economic activity will ''slow noticeably in the fourth quarter'' compared with the 3.9 percent pace of the third quarter, reflecting the impact of higher energy prices, tighter credit and continuing weakness in housing will have on consumer spending.

Many analysts believe growth could be as weak as 1.5 percent in the current quarter.


ECONOMIC FUTURE ROSY FOR UTAH
(Steven Oberbeck, Salt Lake Tribune, 11/9/07)

Utah's economy is the best ever and the prosperity the state's residents are experiencing should continue through the first half of next year.

Kelly K. Matthews, executive vice president and economist for Wells Fargo Bank, said Thursday he is anticipating the state's unemployment rate will remain low at 3 percent during the first half of 2008.

Also, he is projecting there will be more than 48,000 jobs created in the first six months of next year, for a 3.9 percent increase over the number of new jobs that emerged during the first half of 2007.

Pointing to September's job growth figures, Matthews said Utah was the top state with a 4.4 percent increase.

"We were way above everyone in the country," he said, noting that Wyoming and Montana came in second and third with 3.3 percent increases while Arizona was fourth with a 2.6 percent jump in the number of new jobs created.

Even the prospect that the price of gasoline might remain above $3 a gallon in Utah and that the pace of home construction will continue to slacken, doesn't significantly diminish Utah's economic outlook for next year, he said.

"If you look at total construction employment [commercial and residential] in September we were still nearly 12 percent ahead of a year ago," Matthews said. "Total construction employment [in Utah] should remain pretty solid."

So too will consumer spending although rising fuel costs and uncertainties in the housing market might dampen it a bit from 2007.

Still, Matthews said, with 3.9 percent job growth and a 5.5 percent increase in hourly wages, the increase in consumer spending during the first half of 2008 easily could top a respectable 7.5 percent.

Mark Knold, senior economist at the Utah Department of Workforce Services, said while there may be subtle changes in Utah's economy during the first half of 2008, overall the state will experience strong growth, a tight labor market and low unemployment.

"On the micro level we may see some subtle weakening - maybe slightly fewer construction jobs," he said. "But any jobs that might be lost will be more than made up for in other areas. After all, we still have new buildings and offices going up and those will have to be filled [with employees]."

There also is good news for Utah investors.

Sterling Jenson, senior managing director of Wells Fargo Capital Management in Salt Lake City, said while there may be long term volatility the nation's stock markets likely will hit a bottom within the next three months.

"The stock market should then continue its upward movement to substantially higher levels," he said.

He supported that view by pointing out the shares of the companies that make up the Standard & Poor's 500 now are trading at an average of 15 times earnings, or well below the 19 times to 22 times earnings typical during the past 36 years.

And that means there could be room for the S&P 500, which now is trading around 1,500, to advance another 13 percent or more.

TRADE DEFICIT AT 28-MONTH LOW
(Martin Crutsinger, The Associated Press, 11/9/07)

WASHINGTON - A falling dollar has boosted U.S. exports to record highs, pushing the trade deficit down to its lowest level in 28 months.

The trade gap with China, however, worsened as retailers brushed aside worries about a string of high-profile recalls to stock their shelves with Chinese imports for holiday shoppers.

The Commerce Department reported Friday that the trade deficit dipped 0.6 percent in September to $56.5 billion, the smallest imbalance since May 2005.

The improvement came from a 1.1 percent jump in U.S. exports, which climbed to a record $140.1 billion. The dollar's decline against many major currencies has made U.S. goods cheaper and more competitive in foreign markets. American producers are also benefiting from stronger growth overseas.

While the weaker dollar boosts exports, it also raises worries on Wall Street about whether foreign investors may at some point start dumping their dollar-holdings because of the declines. The dollar's decline to a record low this week against the euro helped to trigger a 361-point drop in the Dow Jones industrial average on Wednesday.

Treasury Secretary Henry Paulson said Friday that he was not worried that the U.S. dollar might at some point lose its position as the currency of choice for investors.

''The dollar has been the world's reserve currency since World War II and there is a reason. We are the biggest economy in the world. We are as open as any economy to investment,'' Paulson said.

Paulson predicted that despite the current troubles in housing and the credit markets, the U.S. economy would continue to expand because ''you are going to see our strong economic fundamentals . . . shine through.''

The trade report showed that imports were also up in September, climbing by 0.6 percent to $196.6 billion, the second-highest level on record. Oil imports fell, however, by 0.8 percent to $10.5 billion, an improvement that is likely to be temporary given the recent surge in oil prices to close to $100 per barrel.

The deficit with China rose to the second-highest level on record, up 5.5 percent to $23.8 billion, reflecting big gains in shipments of Chinese-made televisions, cell phones, computers and toys.

So far this year, the trade deficit is running 7.4 percent below last year's record of $758.5 billion, putting the country on track to record a smaller trade gap after five straight years of record highs.



FED EXPECTS SLOWER GROWTH,
HIGHER UNEMPLOYMENT

(Source: Salt Lake Tribune, 11/20/07)

The housing collapse and credit crisis will slow economic growth and nudge up unemployment next year, the Federal Reserve said Tuesday in a first-of-its-kind forecast that some economists say will lead to interest rate cuts early in 2008.

Don't count on a cut in rates at the Fed's December meeting, however, analysts say.

The Fed called its rate reduction in late October a ''close call'' and hinted that its two cuts this year may be sufficient to energize the economy, according to minutes of the Oct. 31 closed-door meeting made public Tuesday.

But with the Fed's longer-term forecast calling for moderating inflation next year and beyond, economists believe the central bank will have leeway to reduce rates next year.


CONSUMER MORALE LOWEST IN TWO YEARS
(Source: The Associated Press, 11/27/07)

NEW YORK - Just when the economy needs them the most, consumers are feeling less confident than they have since hurricanes Katrina and Rita pummeled the Gulf Coast two years ago.

U.S. consumers face a multitude of problems - higher gas prices, a volatile stock market and a slumping housing market - that are fueling worries among retailers of a frugal holiday with only a month left of the critical Christmas shopping season.

On Tuesday, the New York-based Conference Board said that its Consumer Confidence Index dropped to 87.3, marking a four-month slide and down almost 8 points from the revised 95.2 in October.

It was the lowest reading since 85.2 in October 2005, when gas and oil prices soared after the hurricanes flooded New Orleans and shut down a large chunk of the nation's oil refineries. It also marked the sharpest drop since September 2005, when the index plummeted 18 points from the previous month. Analysts had expected a reading of 91.5 in November.

''Consumers' apprehension about the short-term outlook is being fueled by volatility in financial markets, rising prices at the pump and the likelihood of larger home heating bills this winter,'' said Lynn Franco, director of The Conference Board Consumer Research Center, in a statement.

The Present Situation Index, which measures how shoppers feel now about the economy, fell to 115.4 from 118.0 in October. The Expectations Index, which measures shoppers' outlook over the next six months, declined to 68.7 from 80.0.

''It doesn't mean that shoppers are not going to spend. It implies they are going to be cautious,'' this holiday season, said Joel Naroff, president and chief economist at Naroff Economic Advisors Inc. ''To me, it will be a mediocre season, not a terrible one, but not a good one either.''

For retailers, the downbeat report on consumer confidence further fueled concern that the holiday shopping season will be weak. Retailers struggled with disappointing sales this past fall, and while many retailers were encouraged by better-than-expected turnout for the official start of the holiday shopping season, it was the fat discounts that lured consumers in.

The big worry is that shoppers will take their time returning to the stores amid worries that higher gas, an escalating credit crisis and a slumping housing market could push the economy into a recession.

 

FED HINTS AT POSSIBLE RATE CUT
(Source: Combined News Services, 11/29/07)

WASHINGTON - Federal Reserve Chairman Ben Bernanke hinted Thursday that another interest rate cut may be needed to bolster the economy. The worsening credit crunch, a deepening housing slump and rising energy prices probably will create some ''headwinds for the consumer in the months ahead,'' he said.

Bernanke said he expects consumer spending will continue to grow and suggested the country can withstand the current problems without falling into a recession. But he indicated that consumers could turn more cautious as they try to cope with all the stresses.

The odds have grown that the country could enter a recession. A sharp cutback in consumer spending could send the economy into a tailspin. Against this backdrop, Fed policymakers will need to be ''exceptionally alert and flexible,'' Bernanke said.

That comment probably will be viewed as a sign the Fed may lower interest rates when it meets on Dec. 11, its last session of the year.

Also Thursday, the deteriorating housing market forced the White House to lower its projection for economic growth next year and raise its forecast for unemployment. Inflation was expected to moderate.

The new forecast came as the Commerce Department reported that the economy barreled ahead in the summer at a 4.9 percent growth rate, the strongest showing in four years. That impressive performance, however, wasn't expected to last through the current quarter, given the strains of the housing slump and credit crunch - problems likely to weigh on individuals and businesses alike.

Under the administration's new forecast, the gross domestic product, or GDP, will grow by 2.7 percent next year. Its old projection called for a stronger, 3.1 percent increase.

''The housing market decline has been more significant than we expected,'' said Edward Lazear, chairman of the White House Council of Economic Advisers.

A second report from the department showed that new-home sales increased 1.7 percent in October from September. That left sales at a seasonally adjusted annual rate of 728,000. Even with the nudge up, sales have plunged 23.5 percent over the last 12 months. In September alone, sales dropped to a pace of 716,000, the lowest since 1996.

The median sales price of a new home fell to $217,800 in October. That is down 13 percent from a year ago, marking the biggest annual decline in prices since September 1970. The median price is where half sell for more and half for less.

In October sales rose in all parts of the country, except for the West, where they tumbled 15.7 percent from the prior month. The slight increase in monthly sales nationwide didn't change the grim housing outlook.

U.S. home foreclosures almost doubled in October from a year earlier as subprime borrowers struggled to make higher payments on their adjustable-rate mortgages, according to data compiled by RealtyTrac Inc.

There were 224,451 foreclosure filings, including default notices, auction notices and bank repossessions, a 94 percent jump from October 2006 and a 2 percent increase from the previous month, RealtyTrac reported Thursday. California had the most filings with 50,401 and Florida was second with 30,190. Nevada had the highest rate, one for every 154 households, more than triple the national average.

The Fed has lowered interest rates twice this year - in September and late October - to keep the housing collapse and credit crunch from throwing the economy into a recession. Since then financial markets have suffered through another period of turmoil, the housing slump has deepened and consumer confidence has tanked. The odds of another rate cut in December are rising, analysts said.

Businesses largely carried the economy in the third quarter, with U.S. exports powering growth. Consumer spending was somewhat subdued.

The big worry is that consumers and businesses will cut back on spending and investing, dealing a blow to economic growth. The odds of a recession have grown this year. Still, the Bush administration, Fed officials and many economists remain hopeful the country will weather the financial storm without falling into recession.

''We may see slowing of the growth, but we'll still see growth,'' Commerce Secretary Carlos Gutierrez said in an interview with The Associated Press. Will there be a recession? ''We don't see that,'' he said.

Treasury Secretary Henry Paulson agreed. ''While the difficulties in housing and credit markets and the effects of high energy prices will extract a penalty from growth, the U.S. economy has many strengths, and I expect the expansion to continue,'' Paulson said.

In the Fed's October meeting, Bernanke and his colleagues signaled that further cuts might not be needed. Since then, however, financial markets have endured more turmoil. The housing slump has deepened, consumer confidence has plummeted and consumer spending ''has been on the soft side,'' Bernanke said in a speech Thursday night to business people in Charlotte, N.C.



CALENDAR

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2007

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DECEMBER new web bluebar.JPG - 1.70 K

3-7     Northwest Mining Association Annual Meeting, Doubletree Hotel, Spokane, Washington. For more info. visit www.nwma.org

3-4    Coal Trading Conference. For more info. visit: www.americancoalcouncil.org

12     MSHA 8-hour training for Metal & Non-Metal Surface Miners, Utah Safety Council, 1574 West 1700 South,
Suite 2A, Salt Lake City. For more info. visit www.utahsafetycouncil.org

2008

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MARCH new web bluebar.JPG - 1.70 K

5-6    High Altitude Revegetation Workshop, Hilton Hotel, Fort Collins, Colorado. For more info. call Wendell Hassell at 303-422-2440.

18- 22   Alaska Miners Association Conference, Westmark Fairbanks Hotel & Conference Center, Alaska. For more info. visit www.arcticminers.org

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30-1    RMCMI Colorado-Utah meeting, Grand Junction, CO. For more info. visit www.rmcmi.org

 

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10     UMA Educational Golf Touranment, Riverbend Golf Course, Riverton, Utah

29-1 RMCMI Convention, The Canyons, Park City, Utah. For more info. visit www.rmcmi.org

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AUGUST new web bluebar.JPG - 1.70 K

14-15  UMA 93RD ANNUAL CONVENTION, GRAND SUMMIT HOTEL, PARK CITY, UTAH

 

 


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