Press Release - Wednesday, September 21, 2005
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GOV. BLAGOJEVICH INVESTS NEARLY $15 MILLION INTO MAKING ILLINOIS COAL MORE COMPETITVE WHILE ALSO CREATING HUNDREDS OF NEW JOBS
CUTLER - Furthering his pledge to revitalize the Illinois coal industry and create better opportunities for working families across Illinois, Gov. Rod R. Blagojevich today announced nearly $15 million in Opportunity Returns grants to coal-related projects that will result in the opening of a new Southern Illinois mine, expand existing mines and create hundreds of new mining jobs. He made the announcement at the site of the new Knight Hawk Coal-Prairie Eagle Mine that is creating 80 new jobs.
"We have been unwavering in our willingness to bring vitality back to a critical Illinois industry that has been through hard times but is seeing a much brighter future," Gov. Blagojevich said. "Our investment is leveraging almost $90 million in private dollars that will allow a vibrant Illinois coal industry to take advantage of better prices, explore new markets and deploy the latest clean-coal technology, while also creating good jobs for working families across Illinois."
More than $3 million in matching funds is supporting the opening of the new $24.5 million Knight Hawk Coal-Prairie Eagle Mine in Perry County and outfitting the operation with a "highwall" mining device that allows Knight Hawk to tunnel into a coal seam without sinking a shaft.
Also, as part of the Governor's Illinois Coal Competitiveness Program, nearly $600,000 in grants will help launch the $2 billion Peabody Energy-Prairie State initiative to build a new power plant in Washington County employing state-of-the-art technology to reduce harmful emissions. The 1,500-megawatt generating plant and coal mine is estimated to inject nearly $100 million annually into the Illinois economy, create approximately 2,500 jobs at peak construction and 450 skilled, permanent Illinois jobs. The Prairie State Energy Campus is the largest private capital project ever planned for Southern Illinois.
Also expanding production and increasing coal jobs is a $13.8 million project to access new coal reserves at the state's highest-producing mine, American Coal's Galatia Mine in Saline County. Galatia, which produced in excess of 6.2 million tons of coal in 2004, will receive $1.8 million to assist in the purchase of new mining equipment, belt systems and an expanded coal-cleaning operation.
"Time and time again, Gov. Blagojevich has demonstrated his commitment to revitalizing the coal industry in Southern Illinois by making the kinds of investments in cutting-edge technologies that are creating new jobs and protecting the environment," State Senator Gary Forby (D-Benton) said.
"Gov. Blagojevich and I understand that by partnering with coal companies across Southern Illinois, we are helping this vital industry regain its economic footing, while creating more and more jobs," State Rep. Brandon Phelps (D-Harrisburg) said.
"There is no greater advocate for the coal industry than Gov. Blagojevich. We are making the kinds of crucial investments that will ensure this important sector of our economy continues to create good jobs today and tomorrow," State Rep. Dan Reitz (D-Sparta) said.
Funding comes from the Illinois Department of Commerce and Economic Opportunity (DCEO) through its Office of Coal Development, which is providing more than $14.8 million for 27 projects, leveraging nearly $86 million in private investment in the Illinois coal industry.
"Gov. Blagojevich understands that we must keep Illinois coal competitive by investing in this complex and ever-changing global marketplace," DCEO Director Jack Lavin said. "Of equal importance, these Opportunity Returns grants leverage private investment in coal production, coal use and coal transportation industries - funds that companies otherwise might invest in other mines in other states."
This grant program, redesigned by Gov. Blagojevich in 2003, provides up to 25 percent of the cost of each project, with projects competitively selected on several economic criteria.
American Coal Company - Saline County
Two grants: $1.8 million - Total project costs: $13.8 million.
American will add a third coal source, the No. 6 seam. To facilitate the expansion the mine will add new and rebuilt mining equipment, belt drives, belt structure, a new surface coal separation facility, water supply, and dewatering system. The prep plant capacity will be expanded and the slope will be repaired. The expansion allows the mine to re-employ 206 miners who lost jobs due to poor geological conditions, and 50 additional workers have been hired to increase coal production at the Galatia Mine.
Arclar, LLC - Saline County
Grant: $620,000 - Total project costs: $3.1 million.
Arclar will construct a 1/2 mile access road, a rail loadout facility capable of loading more than 100 car trains, refurbish some rail and connect existing rail. The rail project will allow Arclar's Willow Lake Mine to reach new markets via the CN and CSX railways.
Black Beauty Coal Company - Vermilion County
Two grants: $751,000 - Total project costs: $7.03 million.
Black Beauty will expand and update existing mine equipment and expand the refuse disposal area to allow for additional production, preparation and storage. An ash analyzer/conveyor system will be installed at the Vermilion Grove portal to separate coal from refuse. The project will allow the company to increase sales, cut operating expenses and continue to improve environmental protection in the area.
Freeman United Coal Mining Co. - Macoupin County
Two grants: $1.56 million - Total project costs: $7.83 million.
Freeman will purchase 2 continuous miners, allowing a boost in coal production by 1 million tons annually. A second grant will support the purchase of seven battery-powered haulage cars, three roof bolting machines, one scoop, power equipment, belt support equipment and miscellaneous face support equipment, allowing the expansion of mining operations to a third unit to meet coal sales agreements. The firm has hired 63 additional workers.
Gas Technology Institute - Cook County
Grant: $950,000 - Total project costs: $6,258,949.
GTI will relocate, install and test the Morphysorb Pilot Plant from Zapata, Texas, to the GTI plant in Des Plaines. The new plant will allow testing of technology to lower electricity costs, reduce harmful emissions and support the use of Illinois coal.
ICG Illinois, LLC - Logan County
Grant: $750,000 - Total project cost: $6.1 million.
ICG Illinois will add equipment to increase the underground mains, expand beltlines, expand rock dusting and underground watering systems and prepare the impoundment area for future production. The project supports current production levels, while extending the mine's infrastructure for future growth.
Ill. Dept. of Natural Resources-Office of Mines and Minerals - Sangamon County
Grant: $30,000 - Total project costs: $46,387.
IDNR - Office of Mines and Minerals will purchase safety equipment to be used by mine rescue teams throughout Illinois. The new equipment will replace the current equipment that is outdated and unreliable.
Knight Hawk Coal, LLC - Perry County
Two grants: $3.15 million - Total project costs: $24.5 million.
Knight Hawk will purchase a highwall miner and cutter head, temporarily allowing expanded production at Creek Paum mine by 400,000 tons. The highwall miner will later become the cornerstone of production at the new Prairie Eagle Mine. Prairie Eagle will produce 1 million tons of coal annually, creating 80 new mining jobs.
Liberty Coal Company - Saline County
Grant: $860,000 - Total project costs: $6.4 million.
Liberty will add a second mining unit to allow work simultaneously on two production faces, providing capacity for increased production from 1.1 million tons to 1.7 million tons annually. Current production levels are not high enough to support current overhead and fixed costs, threatening the mine's future existence.
Monterey Coal Company - Macoupin County
Three Grants: $902,520 - Total project costs: $5.5 million.
Monterey will upgrade the coal shearer and rebuild other parts of the longwall mining system. A second project includes the purchase of new components for the longwall, including two drive units, beam stage loader, crusher and belt tail piece. The third project is to purchase a rebuilt continuous miner, upgrading equipment used to prepare areas for large-volume longwall mining.
Montgomery County - Montgomery County
Grant: $286,800 - Total project costs: $385,500.
Montgomery County will overlay and repair a section of roadway on the Farmersville Overpass heavily used by coal trucks in the area. The Montgomery County has said it would be forced to load-limit the overpass and approach to Interstate 55, which would cause rerouting coal haulage for area mines thereby increasing costs.
Prairie State Generating Company, LLC - Washington County
Two grants: $572,500 - Total project costs: $2.8 million.
Prairie State will drill and analyse core coal samples and from the Herrin No. 6 seam at the site of a mine eyed for supplying the planned $2 billion Prairie State Generating Station. A grant of $422,500 supports the installation of high-voltage breakers, air break switches, fiber optic cables, instrument transformers, relaying and controls, communication panels insulators and arrestors inside the Baldwin Electric Substation to upgrade the facility to handle 1,500-megawatt load from the new power plant.
S Coal Company - Jackson County
Grant: $720,000 - Total project costs: $4.65 million.
S Coal will purchase new surface mining equipment, including a loader, excavator, and haul trucks and construct roads, ponds and ditches for a new mining area near Elkville. The new mine will supply Southern Illinois Power Coop, Marion Station, after the current company reserves near Cambria are exhausted.
Saline Valley Conservancy District - Saline County
Grant: $87,000 - Total project costs: $437,500.
Saline Valley Conservancy District will construct a new water well, allowing SVCD to meet the needs and demands of the coal industry in Southeastern Illinois. SVCD currently serves the needs of Willow Lake Mine with potable water for bathhouses, as well as water to cool mining bits and for use in the operation of longwall units.
Wabash Mine Holding Company - Wabash County
Three grants: $1.2 million - Total project costs: $8.6 million.
Wabash will replace various worn out belts and conveyance structure along with roof control accessing the mainline conveyor in the Western Reserve. Included is the replacement of six miles of belt and roof support projects to allow continued operation and expansion of mining. A second grant of $300,000 supports the purchase of two continuous mining machines. A third grant of $675,000 supports the purchase of new underground vehicles to haul coal and to transport miners and a new 5,500-foot slope conveyance belt. The projects will increase productivity and improve reliability of the coal supply.
White County Coal LLC - White County
Three grants: $581,200 - Total project costs: $2.96 million.
White County will purchase conveyor belt and belt structure, excavate an area to house the bunker belt, and install the belt transfer point and electronic controls. The project includes purchasing rig time, two continuous miners, cementing services and earth work. The project will increase production capacity by 15 percent, optimize the use of the mine's vertical belt system and support the plugging of wells to allow access to added coal reserves.
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