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CIL Request for Rail Tariff Relief for 701-1400 Kilometres Distance

After Railway Board decided to grant a 20 per cent concession on freight price for a distance of more than 1400 kilometres on the transportation of coal in June, Coal India has urged Indian Railways to offer it a 15 per cent freight concession to transport domestic coal for a distance of 701-1400 kilometres from its mines. Coal India officials said that there is a case for widening the scope of concession as only a handful of consumers in the power sector, which constitutes the bulk of miner’s offtake, are eligible to get the benefits. They said “Extension of freight concession to customers located in the range of 701-1400 kilometres could result in substantial domestic coal lifted by them in place of coal sourced from abroad due to lesser cost of coal conveyance.”

The June concession is on normal tariff rates, provided that after applying the concession, the freight price should not be less than the tariff rate for a distance up to 1400 kilometres. This concession is valid from July 2020 to June 30, 2021. Of the 126 coal-based thermal power plants linked to Coal India, 14 plants located beyond 1400 km are eligible for freight concession at present.

Source : STRATEGIC RESEARCH INSTITUTE
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Blaschak Coal Promotes Mr Andrew Meyers as VP Sales, Marketing & Business Development

One of the US’s leading producers and suppliers of anthracite coal Blaschak Coal Corp announced that Mr Andrew Meyers has been promoted from his position as Manager of Industrial Sales and Business Development to Vice President of Sales, Marketing and Business Development. In his new role, Meyers will continue to serve both the dealer and industrial sides of Blaschak’s business, as well as coordinate marketing and sales initiatives.

As Manager of Sales and Business Development for nearly eight years, Meyers split his time between calling on and coordinating Blaschak’s dealer business and fostering relationships with the company’s industrial accounts such as sugar refineries and steel mills. During his tenure at Blaschak, Meyers helped grow company sales volume to record levels in 2018 while providing unparalleled customer service.

Source : STRATEGIC RESEARCH INSTITUTE
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BHP seeking thermal coal exit, profit slips amid virus hit

Australia’s largest miner BHP has confirmed it is seeking to exit thermal coal mining globally and offload some its metallurgical coal mines in Queensland in a bid to remove risk from its portfolio. After months of signalling it is open to the prospect of exiting thermal coal, BHP said that it is looking at options to exit its thermal coal assets at Mt Arthur in NSW and the Cerrejon project in Colombia, which together account for about 3 per cent of revenue. It also said it was looking to exit its BHP Mitsui Coal joint venture, which mines metallurgical coal in Queensland. BHP chief executive Mike Henry said "We are moving to concentrate our coal portfolio on high quality coking coals, with greatest potential upside for quality premiums as steel makers seek to improve blast furnace utilisation and reduce emissions intensity."

Thermal coal is the heaviest-polluting fuel and the focus of rising investor pressure in response to concerns surrounding its contribution to global warming. BHP's rival Rio Tinto, the world's second largest miner, has already removed all exposure to thermal coal while Anglo-American earlier this year said it intended to offload its thermal coal assets in the coming years.

Source : STRATEGIC RESEARCH INSTITUTE
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Ind-Ra Sees Subdued Coal Prices in 2020-21

India Ratings and Research has published July 2020 credit news digest on India’s coal sector. The report highlights the demand-supply scenario, price trends, imports/exports in both India and China, encompassing non-coking coal and coking coal, while also evaluating at the impact of end-user industries on India’s coal sector. The report also covers the recent updates on commercial coal mining and the agency’s recent rating actions. Production and offtake are likely to have been subdued MoM in July 2020, due to union strikes at mines against privatisation along with the onset of the monsoon season. Domestic coal production remained subdued for the third consecutive month in June 2020 YoY and MoM on the back of a low power demand and high piling inventory at power stations. Accordingly, the coal offtake reduced YoY in June 2020, but improved mom with the gradual relaxation in lockdown norms. However, China’s coal production has bounced back to exceed the previous year’s performance, despite the COVID-19 outbreak.

Overall, domestic coal imports are likely to have been lower in July 2020 YoY due to the low domestic demand from end-user industries amid the COVID-19 outbreak. Also, the government of India has mandated Coal India Limited to replace at least 100 million tonne of avoidable imports with domestic coal in FY21, to reduce imports. The overall coal imports declined for the third consecutive month and were down YoY in June 2020. The share of imports in the total domestic consumption reduced to 22% in June 2020 from 28% in FY20. While the non-coking coal imports reduced 34% YoY, coking coal imports declined 41% YoY.

While the non-coking coal import prices have shown signs of recovery as the power demand picked up over May 2020, the coking coal import price is yet to catch up because the steel sector demand remains subdued. Up to July 2020, the non-coking coal import prices declined by around 40% from mid-January 2020 (pre-COVID levels) and the coking coal import prices have had a free fall of around 25%. Considering the nature of the respective end-user industries, Ind-Ra expects the non-coking coal import prices to pick up gradually while coking coal prices may still take a while to recover.

India’s electricity mix tilted towards renewable energy over the lockdown period with a higher share in the total power generation. Major factors driving the shift towards renewable energy are availability, cost effectiveness and priority access to grids.

Commercial coal mining and the associated reforms announced by the government will go a long way in shaping the coal sector towards a more deregulated and competitive scenario. Key is a robust implementation design and faster execution. Significant states’ resistance over environmental concerns for some mines on offer is likely to stall the auction of such blocks. Furthermore, a global shift towards greener fuels and simultaneous withdrawal from coal-based energy may be a key challenge to participation of industry players.

Source : STRATEGIC RESEARCH INSTITUTE
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China’s coal output decreases by 0.1 percent in January-July

China's National Bureau of Statistics announced that China's coal output in the January-July 2020 amounted to 2.12 billion tonne, down 0.1 percent year on year, shifting from the year-on-year rise of 0.6 percent recorded in the first six months of the year. In July alone, China’s raw coal output amounted to 320 million tonne, down 3.7 percent year on year, 2.5 percentage points higher than the decline rate recorded in June.

At the same time, China imported 200 million tonnes of coal in the January-July period, up 6.8 percent year on year, 5.9 percentage points slower than the rise recorded in the first half of the current year.

Source : STRATEGIC RESEARCH INSTITUTE
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Coal Worker Unions Defer Strike

PTI reported that Coal India trade unions have deferred the day long strike scheduled for August 18 with the Indian government extending the bid due date for the auction of coal blocks for commercial mining. HMS affiliated Hind Khadan Mazdoor Federation said “The five trade unions have unanimously decided to defer the strike.”

The unions had decided to go on strike against the commercial mining and the proposed divestment or buyback of shares of Coal India Ltd. The unions had observed a three-day strike from July 2 to protest against commercial mining of coal.

The earlier bid due date was August 18. According to the revised schedule, the bid due date is now September 29. The electronic auction will be conducted for the qualified bidders from October 19- November 9.

Source : STRATEGIC RESEARCH INSTITUTE
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Vietnam Coal Imports in Jan-Jul 2020 Surge by 50% YoY

According to Vietnam Customs, Vietnam has spent around USD 2.6 billion on importing 36.5 million tonnes of coal in the first seven months of this year, up 50 percent in volume YoY. The country has been importing increasing amounts of coal in recent years as demand from thermal power plants increases and domestic production is mired in difficulties, requiring deeper pits to reach the mineral. It became a coal importer from being a net exporter just five years ago.

Though the government has been trying to reduce its reliance on coal, encouraging solar and wind power plants, thermal power plants accounted for 36.1 percent of the electricity generated last year. Vietnam is expected to import 50 million tonnes in 2030 to fuel its thermal power plants.

Source : STRATEGIC RESEARCH INSTITUTE
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Shandong Approves Merger of Yankuang Group & Shandong Energy

Yankuang Group Co Ltd’s merger with fellow miner Shandong Energy Group Co, which was announced in July, has been approved by authorities. Reference is made to the announcement issued by the Company on 12 July 2020 in relation to the strategic reorganisation being planned by Yankuang Group Company Limited, the controlling shareholder of the Company, and Shandong Energy Company Limited. The Company has been notified by Yankuang Group that the shareholders of Yankuang Group, namely, Shandong Provincial State-owned Assets Supervision and Administration Commission, Shandong Guohui Investment Co Ltd and Shandong Provincial Council for Social Security Fund approved the Merger and related matters on 14 August 2020. Shandong Energy Group and Yankuang Group entered into the Agreement on the Merger of Shandong Energy Group Company Limited and Yankuang Group Company Limited on the same date, pursuant to which Yankuang Group was renamed as Shandong Energy Company Limited after the Merger. From the date of completion of the Merger, all the assets, liabilities, business, employees, contracts, qualifications and other rights and obligations will be inherited, assumed or enjoyed by the Surviving Company; the respective entities under Shandong Energy Group and Yankuang Group and the respective equities and interests in companies held by Shandong Energy Group and Yankuang Group will be transferred to the Surviving Company.

The Merger is subject to antitrust scrutiny and other necessary domestic and overseas review and approval procedures.

As the two groups major businesses are similar, the merger will optimize resource allocation and help improve their competitiveness. Yankuang, which produced 166 million tonnes of coal in 2019, has operations in Shandong and Shaanxi provinces and the Inner Mongolia region. Shandong Energy produced more than 100 million tonnes last year. Joint output of more than 260 million tonnes per year at the newly merged company would make it one of China's largest coal producers, accounting for around 7% of the country's total coal output.

Yankuang's Australian producing subsidiary Yancoal will also be part of the merger. Yancoal expects to produce 36 million tonnes on an attributable basis in 2020, up from 35.6 million tonnes last year, despite the prospect of Covid-19 suppressing demand over the rest of this year.

Shenhua Energy, the listed subsidiary of China's biggest state-controlled coal producer China Energy Investment, has set a production target of 268 million tonnes for this year. China produced a total of 3.75 billion tonnes of coal in 2019.

Source : STRATEGIC RESEARCH INSTITUTE
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Indian Coal Imports in April-July Dip by 31% YoY

PTI reported that according to the Indian Ports Association data thermal and coking coal imports at India’s 12 major ports dropped 31 per cent to 36.7 million tonnes in April-July 2020 over the same period a year ago. Thermal coal imports dropped 30 per cent to 23.19 million tonnes and coking coal shipment fell 32.26 per cent to 13.51 million tonnes during this period.

Coal volumes at these 12 major ports declined for the fourth straight month in July 2020.

India has 12 major ports under the control of the central government - Deendayal (erstwhile Kandla), Mumbai, JNPT, Mormugao, New Mangalore, Cochin, Chennai, Kamarajar (earlier Ennore), V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia).

Source : STRATEGIC RESEARCH INSTITUTE
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Eskom Ends Force Majeure on Coal Supplies from Exxaro

Exxaro announced that following the notification by Eskom Holdings SOC Limited calling force majeure on the agreements for the supply of coal from Exxaro Coal Proprietary Limited to the Medupi and Matimba power stations, a notice was received from Eskom, advising that the force majeure event was withdrawn with immediate effect. As Eskom has been taking coal in accordance with the terms of the supply agreements, the impact of the force majeure event has been largely neutralized.

Exxaro reaffirms its view that this event did not constitute a force majeure, as the power stations have been capable of supplying power and Exxaro continues to reserve its rights in this regard.

Source : STRATEGIC RESEARCH INSTITUTE
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SANY Delivers Rigid Mining Truck & Excavators to Indonesia

Five SANY excavators, including two SY750Hs, two SY500Hs, one SY215C, and one SRT95C rigid-body mining truck, were recently delivered to customers from two large coal mines in Indonesia. SY750H was the first large excavator at 76 tonnes in this year, joining clients excavator fleets that consist of SY500Hs and SY215Cs. Also, the delivery of SRT95C initiated the first rigid truck heading to the coal-mining job sites in Indonesia.

SY750H, the largest-tonnage SANY excavator in Indonesia, is equipped with a 5.4 m3 bucket to achieve higher ripping in difficult ground conditions. It has an ISUZU engine that helps achieve a reduction in fuel consumption. The SY750H crawler excavators are used specifically for overburden, as well as for loading dumper trucks in the mine. They have proved their efficiency, cost-effectiveness and reliability in operation.

The rigid-body mining truck, SRT95C, has a CUMMINS QST high-power engine with electronic fuel injection control and an Allison transmission. This means enhanced acceleration performance and reduced fuel consumption and emissions. The truck's frame is made of alloy structural steel, which features resistance to low-temperature, bending, twisting and impact. In addition, McPherson front strut suspension adopted on the front axle and steering mechanism smooth the ride.

Source : STRATEGIC RESEARCH INSTITUTE
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Bradley Coal Mine to Close in UK

Bradley Coal Mine ClosureBritish media reported that one of England’s last coal mines to close after 2020’s record coal-free runs as the owner of the surface mine, the Banks Group, said Bradley coal mine at Leadgate in County Durham will extract its last coal on 17 August, after the UK continues to set zero-coal records in 2020. Banks Group runs mines in the south of Wales and Scotland, and applied for permission to extend the life of its final mine in England until 2021, but earlier this summer the application was denied.

Operator Banks Mining says 250 skilled jobs are at risk in the family-owned firm, which still runs mines in Scotland and South Wales.

The Hartington mine in Derbyshire is the last surface mine in England still using its remaining coal reserves, for longer than expected.

Source : STRATEGIC RESEARCH INSTITUTE
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Do We Really Need to Mine More Coal and Cut More Forests?

A new investigation by CSE/Down To Earth magazine has raised serious questions about the rationale behind the government’s recent move to auction more coal blocks. On June 18, 2020, Prime Minister Narendra Modi had announced that 41 new coal blocks would be opened for auction to the private sector. The logic behind the decision, as offered by the government, was that the country needs the coal to power its energy and industrial sectors. Editor Sunita Narain said: “Our forests are where our coal reserves are forests and coal are intrinsically linked in India. And our poorest people live in these areas, which also hold our most abundant watersheds. If at all we must mine coal, which itself has serious pollution implications, we need to do after careful consideration that we have taken utmost care not to destroy forests needlessly and this means the need to optimise on current mines not mine more.”

She added: “We recognise the fact that India needs energy security. In countries like ours, energy poverty is an unacceptable reality. We need access to energy to meet the needs of millions of people. But we also know very well that mining and using coal has immense environmental impacts, impacts that are detrimental for our forests, water bodies and people and their livelihoods and add to the health burden because of air pollution. Are we able to balance these two counter realities? In our view, we are failing to do so abysmally.”

Since 1980, when the Forest Conservation Act was enacted, India has diverted 0.53 million hectares of forestland for mining, the bulk of it for coal. Since 2015, 49 coal mining projects have been cleared. This is expected to have led to the decimation of over 19,000 hectares of forestland; cutting down of over 1 million trees; and displacement of over 10,000 families, says the Down To Earth investigation.

Ms Narain said “It is clear that we are not concerned about maintaining a balance. There is clear evidence that existing processes of assessing and diverting forests under the Forest Conservation Act have been subverted. In fact, our research finds that these have been weakened so much that they have become farcical.”

The government argues that it has moved out of the system of categorising forests as No-Go and instead has devised a sophisticated decision support system so that each forest block, which is required to be diverted for mining, can be assessed in terms of ecological, hydrological and other parameters. However, DTE’s investigation finds that this so-called scientific process of decision-making has been made meaningless. This has happened because, firstly, there is lack of data on the ecological qualities of the forests which would allow for the software to identify such areas as inviolate. Secondly, it can be tweaked, as indeed minutes have revealed, to make the No-Go, into a Go-forest. DTE has published minutes of meetings where the coal ministry officials were ‘deputed’ to work with the Forest Survey of India to rework the conditions so that forests can be cleared for mining.

Ms Narain points out that significantly, every time the government offers newer opportunities for mining coal, it targets denser forests. Since 2015, of the 49 blocks cleared for coal mining, nine were in No-Go areas. No-Go refers to un fragmented forest landscapes having a gross forest coverage more than 30 per cent and weighted forest coverage more than 10 per cent. In 2020, of the 41 blocks put up for auction, 21 feature in the original No-Go list.

CSE/DTE also investigated the rationale behind the auction of new coal mines to understand which sector would consume larger quantities of coal – so needed for energy security and self-reliant India. It finds that whereas today, over 70 per cent of the coal is consumed in the thermal power industry, this is not expected to grow exponentially. This sector is already stressed and will remain underutilised in the future as more sources of energy – renewable or hydel are built.

Ms Narain points out that India is currently not utilising its existing capacity fully, an RTI response by the Union Ministry of Coal says that 67 per cent of the mines auctioned since 2015 are not yet operational. She said “Between 2015 and 2020, the government has tried to auction 112 mines, but succeeded in only 42 cases. So, why should we auction new coal mines that will come at the cost of our dense forests and habitats of people? This when we find that our systems to ensure a balanced decision making between the interests of coal and of forests have been so deliberately disabled and weakened. In this strategy, it would seem, India is condemned to remain locked with a dirty fuel, which is toxic for people’s health and will be a death knell for our forests. Let us hope this does not happen.”

Source : STRATEGIC RESEARCH INSTITUTE
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JSW Coal Miners Plasma Donations Help COVID19 Drug Research in Poland

Agence France Presse reported that blood donations from Polish coal miners who recovered from coronavirus have helped research into a new plasma-derived drug. Biomed Lublin CEO Marcin Pirog said that the miners from Jastrzebska Spolka Weglowa, a company with five coal mines, deserved special recognition for their blood donations. The pandemic has hit particularly hard in the Silesia coal basin in southern Poland, although the national rate has remained relatively low compared to much of western Europe.

Convalescent plasma, the fluid in blood teeming with antibodies post-illness, has proven effective in small studies to treat Covid-19. The company is planning to produce an initial batch of 3,000 doses of the drug for testing and said it would eventually be able to produce around 30,000 to 40,000 doses, depending on having sufficient plasma available. The researchers said they had collected around 150 liters of plasma for initial production.

Source : STRATEGIC RESEARCH INSTITUTE
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Sasol Sells Secunda Air Separation Units to Air Liquide

Air Liquide is buying oxygen production site from Sasol in South Africa. The 17 air separation units at Sasol’s site in Secunda produce 42,000 tonne per day of oxygen for use in synthetic fuels and chemicals produced from coal. Air Liquide built all 17 units over the last 40 years, but to date operated only one of them, the largest, which started operations in 2018. Air Liquide said it will invest around EUR 440 million and in coordination with Sasol is aiming to reduce CO2 emissions from the oxygen-production operations by 30-40% by 2030. This includes modernising the units, using digitalisation techniques to optimise operation, and investing in 600 MW of renewable energy.

The sale by Sasol is part of efforts to sell assets so it can focus on core operations, and to decarbonise its business.

Sasol Limited is an integrated energy and chemical company based in Sandton in South Africa. The company was formed in 1950 in Sasolburg in South Africa and built on processes that were first developed by German chemists and engineers in the early 1900s including coal liquefaction. Today, Sasol develops and commercialises technologies, including synthetic fuels technologies, and produces different liquid fuels, chemicals and electricity
Source : STRATEGIC RESEARCH INSTITUTE
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Semirara Mining Profit Hit by COVID19 Slump

Philippines Semirara Mining and Power Corp reported a 61% drop in after tax income to PHP 2.2 billion in as quarantine policies enforced since March pulled down coal demand and electricity sales. Its coal business brought PHP 1.8 billion in earnings contribution, almost down by three-fifths. It sold 5.7 million metric tonnes of coal between January and June with prices averaging at PHP 1,765-2,229 in the same months a year ago. The company noted the historic dips in coal prices, particularly in April when the benchmark Global Coal Ltds NewCastle prices plunged to USD 49.30 per tonne, touted as the sharpest drop in six years

Semirara President and Chief Operating Officer Ms Cristina C Gotianun said “The decrease in spot market prices in April was also staggering.”

The same reason was cited for the net loss of PHP 236 million incurred by its energy subsidiary, Southwest Luzon Power Generation Corp in the first half, from PHP 1.6 billion in earnings it recorded in the same period a year ago. It said electricity sales and average selling price from March to June were also affected by the pandemic. SLPGC recorded a 43-percent drop in energy sales from 856 gigawatt hour to 489 GWh and a 38-percent cut in average selling price from P4.73 per kilowatt hour to P2.92 per kWh.

Source : STRATEGIC RESEARCH INSTITUTE
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11 Coal Miners Injured in Asansol

ANI reported that 11 labourers working in coal mines for injured after the lift carrying them got broken in West Bengal’s Asansol. Of the 11, 3 labourers have been severely injured. The injured have been shifted to the hospital.

This incident led to outrage amongst people against Labor organization. Locals accused the organization of ignorant behaviour towards the safety of labourers.

Source : STRATEGIC RESEARCH INSTITUTE
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Nagaland Youth Congress Seeks Withdraw of Draft Notification for EIA

Nagaland Pradesh Youth Congress has demand unconditional withdrawal of the draft notification for Environment Impact Assessment (EIA), 2020 that would supersede the EIA notification of 2006 under the Environment (Protection) Act, 1986. In a representation to Union environment, forests and climate change minister Prakash Javadekar, NPYC president Vilhousielie Kenguruse and general secretary Serangmong Sangtam stated that the notification deserved extensive discussions and that the epidemic situation was not the time for that.

Mentioning that the proposed changes were not guided by environmental concerns but by concerns for corporate sector, the Youth Congress alleged that the policies implemented by various governments in favour of “neo colonial powers and corporate” had made lives of people miserable as soil, drinking water, seas and forests have been deeply encroached. It said the new draft for EIA 2020 was bound to intensify the crisis.

The representation pointed out that there is a provision for public consultation in existing rules, including a public hearing at which the local community and interested persons can give opinions and raise objections, based on the draft EIA report prepared by experts for any project. And the major change proposed in the existing regulations was the removal of several activities from the purview of public consultation. A list of projects has been included under Category B2, expressly exempted from the requirement of an EIA (Clause 13, sub cl. 11). Also, coal and non-coal mineral prospecting and solar photovoltaic projects do not need prior environmental clearance or permission in the new scheme.

Source : STRATEGIC RESEARCH INSTITUTE
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Federal Government to Join Assessment of Teck Coking Coal Mine Expansion in BC

The Canadian Press reported that Canada’s federal government will join an environmental assessment of a major expansion to a proposed southern British Columbia coal mine after Environment Minister Jonathan Wilkinson used the analysis to make his decision, on the Teck Resources project. Impact Assessment Agency of Canada said “The potential for adverse effects may not be mitigated through project design, the application of standard mitigation measures, or through existing legislative mechanisms.”

Teck is planning an expansion to its network of coal mines in the Elk Valley area of southeastern BC. The Castle project would increase the area being mined by about one-third and allow the company to maintain production of coking coal at 27,400 tonnes a day. The mine expansion would also produce significantly more coal than the threshold required for a federal review.

The company’s existing mines in the area are responsible for significant problems with selenium, an element toxic in large amounts. Reports on concentrations in area waterways show levels up to four times BC’s maximum for drinking water. Monitoring stations near the mines have reported levels 50 times what’s recommended for aquatic health. Teck’s own research has reported the near-disappearance of rare cutthroat trout from a 60-kilometre stretch of the Fording River downstream from the company’s four mines. That water flows into the cross-border Koocanusa Reservoir. The reservoir drains into the Kootenai River, which flows about 200 kilometres across Montana and Idaho.

Source : STRATEGIC RESEARCH INSTITUTE
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West Virginia Coal Association Endorses Incumbent Governor Jim Justice

The political action committee of The West Virginia Coal Association, which represents businesses in underground and surface coal mine production, has endorsed incumbent Governor Jim Justice. West Virginia Coal Association president Mr Bill Raney said “Under Governor Justice’s leadership, he’s worked to protect the miners, increase coal production, and explore innovative ways to use coal for new products and downstream job opportunities. Like his father, Governor Justice knows the coal industry and totally understands our coal miners and managers and the challenges they face every day. We know Governor Justice is the candidate who can be trusted to do everything in his power to fight and stand up for the hardworking men and women in our industry as well as all those throughout West Virginia.”

The political action committee for the United Mine Workers, which represents union miners, earlier this month endorsed Justice’s opponent, Democrat Ben Salango. The UMW had endorsed Justice five years ago.

Source : STRATEGIC RESEARCH INSTITUTE
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