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Wyoming Uranium Producers Optimistic About Restarting Production

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By Ike Fredregill, Cowboy State Daily

Production at Wyoming’s uranium mines all but ground to a halt in recent years as prices bottomed out, but business is looking up as global stockpiles wither and America reconsiders purchasing strategic minerals from its enemies. 

The resulting boost in prices has Wyoming producers looking at the possibility of restarting production.

“With the Russian invasion of Ukraine, it all came to light how dependent we are on Russian control of the fuel cycle,” said Travis Deti, Wyoming Mining Association executive director. “Any uranium we mine here in the States has to go to Russia for conversion and enrichment.” 

With 92 of the world’s estimated 435 nuclear reactors located in the U.S., America is the world’s largest supplier of nuclear power — a process fueled by yellowcake uranium. 

When used to fuel a reactor, about 1 pound of uranium can produce the same amount of energy as 20,000 pounds of coal, the WMA reported.

Following the 2011 Fukushima nuclear disaster in Fukushima, Japan, however, global uranium stockpiles became inflated, driving down the price of a pound of yellowcake to a low of about $17.

“We have the capability to produce, but that’s dependent on the price per pound,” Deti said. “For the last couple of years, the price has been so depressed, it’s not been economical to mine the resource in Wyoming.” 

‘Decade Of Underproduction’

Scott Melbey, president of Uranium Producers of America, said global uranium stockpiles are dwindling, causing yellowcake prices to rise. 

Melbey also serves as the executive vice president of Uranium Energy Corporation, which owns assets in Wyoming’s Powder Basin and Texas. 

“The price of uranium has jumped to $50-$60 a pound recently,” Melbey said. “We’re comfortable enough with the current market that we’ll be restarting operations in Wyoming and Texas.”

In northeast Wyoming, Peninsula Energy Limited CEO Wayne Heili is eyeing the markets as he and his team consider restarting Strata Energy Incorporated’s uranium mining operations. 

“We certainly saw a spike in prices during the beginning of the war in Ukraine, but I don’t think it’s a blip in the market,” Heili said, explaining prices have leveled in the months since the Russians’ initial push. “And I anticipate prices will continue to rise, because the world has experienced a decade of underproduction.”

Unlike some mineral extraction operations, rebooting a uranium operation is a lengthy process.

Melbey said his company was well-positioned to begin extraction before the end of the year, but Heili said the earliest his operations would be online would be the first quarter of 2023. 

Strategic Uranium Reserve

Uranium prices are only one piece of the puzzle, however. Melbey, Heili and the rest of Wyoming’s producers have reason to believe stateside uranium production could become more common in the next few years. 

In 2019, former President Donald Trump’s administration formed the U.S. Nuclear Fuel Cycle Working Group, which determined the nation’s reliance on foreign uranium production presented a national security risk, Deti said.

As a result, Trump’s administration proposed establishing a Strategic Uranium Reserve (SUR), which could stockpile about 10 years’ worth of uranium. To create the stockpile, Deti said the Trump administration wanted to spend $1.5 billion over a 10-year period to purchase uranium from U.S. producers. 

In 2020, Congress authorized spending $75 million to establish the SUR, but the U.S. has yet to start purchasing American-produced uranium. 

Additionally, Sen. John Barrasso, R-Wyoming, introduced legislation in March which could prohibit the U.S. from importing Russian uranium. 

In an email, Barrasso’s deputy communications director, Sarah Durdaller, said the senator was pushing to eliminate American reliance on Russian fuel exports. 

“(Barrasso) stated, ‘The time is now to permanently remove all Russian energy from the American marketplace,’” Durdaller wrote. “‘We know Vladimir Putin uses this money to help fund his brutal and unprovoked war in Ukraine. While banning imports of Russian oil, gas and coal is an important step, it cannot be the last. Banning Russian uranium imports will further defund Russia’s war machine, help revive American uranium production, and increase our national security.’”

As awareness grows of the risks of relying on foreign and sometimes hostile countries for the nation’s fuels, the uranium industry could write a new page in Wyoming’s history book. 

The atrocities of war are no cause for celebration, Melbey said, but one outcome of the Ukrainian conflict could be a secure line of production for U.S. nuclear reactors. Regardless of the war, he said American producers are gearing up to meet rising global demands. 

“My optimism is based on the fundamentals of supply and demand,” Melbey said. “The Russia-Ukraine war is a geopolitical black swan that throws gas on the fire, but the fire was already lit.” 

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State, Energy Groups Criticize EPA Policy Blaming Wyoming For Denver Smog

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By Clair McFarland, Cowboy State Daily

Wyoming and some of its energy industry groups are criticizing as “illogical” proposed federal rules that would punish the state for contributing 1% of the pollutants that make up Denver-area smog.

Two industry groups and the state itself responded during the public comment period on U.S. Environmental Protection Agency’s “Good Neighbor” policy, which would regulate nitrogen oxide emissions in areas that have no pollution problem, but are identified by the EPA as contributors to the problems in other states.

“The EPA-proposed (federal plan) to regulate NOx (nitrogen oxide) emissions is not supported with scientific basis and the analysis is flawed,” Travis Deti, executive director of the Wyoming Mining Association, said in a May 3 letter to the EPA.  

Deti’s comments were echoed this month by a petroleum industry advocate who called the rule “bizarre,” and by the state of Wyoming itself, which called the rule “arbitrary” and unfair.  

Seasonal Shutdowns 

The Environmental Protection Agency (EPA) in April announced that states contributing more than 1% in ground ozone ingredients to downwind states that are in violation of EPA ozone limits could soon fall under federal emissions controls, called the “Good Neighbor” policy. 

The EPA said Wyoming contributes about 1.1% of the ingredientsd that make up smog found in the Denver area, so it would be one of the upwind states affected by the new rule.  

But in the public comment period that ended Tuesday, Wyoming’s energy sector advocates called the EPA’s scientific process faulty.  

Deti called the emission standards “unachievable” and said they would hurt Wyoming’s economy without reducing Denver area smog to levels considered acceptable by the EPA.

After reviewing the public comments on the rule, the EPA will decide whether it should be adopted. If adopted, the rule would impose seasonal shutdowns on power plants and put emissions limits on other businesses, all of which could raise electricity prices for Wyomingites and other Westerners, according to critics.   

‘Better Chance’ Of Smog From Denver 

Another Wyoming energy advocate, the Petroleum Association of Wyoming, said it was “bizarre” that the EPA would enforce the same emissions laws on Wyoming that it does on California when California winds send 42 times more smog ingredients to other states than Wyoming’s winds do.  

Wyoming’s only downwind state with a noted smog problem is Colorado.  

The association pointed to Gillette’s Wyodak coal power plant as a debunking factor in EPA’s blanket policy.  

“The prevailing wind in Gillette comes from the south and southwest, which is the opposite direction of Denver. Yet the EPA is proposing that this facility is contributing significantly to (Denver smog),” Colin McKee, PAW regulatory affairs director, said in a Monday letter to the EPA.  

Cheyenne winds, McKee added, usually blow to Kansas and Nebraska. “During most of the year, the general wind directions do not lend themselves for emissions generated in Wyoming to travel to Denver,” said McKee. “In fact, it seems more likely that emissions from sources along the (Denver-area) Front Range have a better chance of coming into Wyoming.  

Colorado, however, is not penalized under the EPA’s good neighbor policy, as EPA data projects that Colorado won’t send more than 1% of smog-causing ingredients to its own downwind states in 2023.  

Contrary To Law’ 

Wyoming itself pushed back on the federal agency.  

In a Tuesday letter by Wyoming Department of Environmental Quality Director Todd Parfitt, Parfitt noted that the EPA in 2015 found it “not appropriate” to impose Good Neighbor emissions laws on Western states like Wyoming, but shifted its position in 2021.  

“The EPA flip-flopped,” said Parfitt in the letter. “Rather than working with Western states, EPA proposed its Transport Rule, including the wholesale adoption of (new emissions embargoes) to Western states, without its promised consultation.”  

The state rebuked the EPA for the policy’s short public comment period, which ended Tuesday, the very date of Parfitt’s letter.  

“EPA’s proposed transport rule is contrary to law and is based on flawed science,” the letter continued, listing additional concerns, including the following:  

Wyoming depends heavily on its energy sector and other NOx-emitting businesses;  

Wyoming has managed its own air quality without requiring federal environmental plans;  

EPA’s testing did not include smog ingredients caused by lightning or by the methane emissions of one of Denver’s own basins; 

Even if Wyoming reduced downwind smog ingredients to zero, Denver still wouldn’t be in compliance with EPA’s limits;

Job losses, power plant shutdowns and economic lags all could result from the rule, according to the DEQ’s letter;  

Oregon appears to be enjoying EPA favoritism, the DEQ implied, because the EPA is forgiving some of Oregon’s California-bound emissions.  

According to the Federal Register, federal entities may change, terminate, or continue with rulemaking after the public comment period as they deem appropriate.  

Colorado Regulates Air 

Colorado has labored under its own rigorous emissions controls for years, according to Mike Silverstein, Colorado Regional Air Quality Council director.  

Silverstein emphasized that the RAQ is an environmental planning group established by Colorado’s governor and while it works closely with the state, it does not represent the state of Colorado or its governor.  

“My board, the Regional Air Quality Council is supporting EPA’s efforts to reduce emissions in the upwind states,” said Silverstein in an interview with Cowboy State Daily. 

“We’re not taking a position on how that should be done,” he said, adding that RAQC was advised to send “supportive comments” to the EPA on the matter.  

The Denver area has exceeded EPA ground ozone standards for years. The region was downgraded from “moderate” to “serious” in 2019 and is slated to be reclassified as “severe” this July. 

Each downgrade brings more federal regulation and millions of dollars in penalties payable to the state, and, in the case of the “severe” designation, reformulated gasoline will be required throughout the region by next year.  

Reformulated gasoline so far is only required in nine areas of the U.S., all urban metropolitan areas.  

It’s time for upwind states to help out, said Silverstein.  

“My own analysis says upwind sources are influencing our ability to come into compliance with the ozone standards,” including Wyoming, Utah, and California, he said.  

“They have emissions that are contributing to our problem, and that we’d appreciate if those, through EPA’s action, those emission reductions occurring in those upwind states help us in our quest in coming into compliance with ozone standards,” he said. 

‘We Have Our Own Issues’ 

Silverstein clarified that Colorado has plenty of domestic nitrous oxide and volatile organic compound (smog ingredients) emission sources, but said there have been many rule changes implemented to combat those, including: stringent requirements on paint, cleaning products, and the oil and gas industry; the phasing-out of coal power plants; requirements for about 7% or more of vehicles sold to be electric vehicles; grant incentives for companies to install electric vehicle charging stations, and other transportation reforms. 

Ozone Not Down 

An EPA data chart depicting Colorado ozone trends shows no noteworthy decline or increase in smog trends in more than a decade.  

Silverstein said the state’s population increases during that time suggest that emissions per person are actually going down, which he deemed an improvement.  

“We haven’t gotten there but we’ve made that progress because of the emission control programs we’ve had that have countered the dramatic growth in our state,” he said.   

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President’s Angry Letter To Oil, Gas Companies Falls Flat With Wyoming Producers

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By Coy Knobel, Cowboy State Daily

A letter from President Joe Biden to oil and gas company executives blaming them for high energy prices was more hypocritical than helpful, an industry spokesman told Cowboy State Daily Tuesday.

Ryan McConnaughey, vice president and director of communications for the Petroleum Association of Wyoming, said Biden’s letter makes improper assumptions about how oil and gas prices are determined.

“He makes it seem like oil and gas companies are setting the price,” McConnaughey said. “They aren’t.  Setting prices is global, so I don’t understand how they think profit margins could do this.”

Dragged Feet

In a June 14 letter to ExxonMobil, Marathon Petroleum Corp., Valero Energy Corp, Phillips 66, Shell, BP and Chevron, Biden wrote that Vladimir Putin “is principally responsible for the intense financial pain the American people and their families are bearing.”

However, he also claimed oil refining companies have dragged their feet on increasing fuel supplies they cut during the COVID pandemic when there was less demand.  Less supply means higher prices and profits. 

“In the year before I took office, refineries in the United States reduced their capacity by more than 800,000 barrels a day, leaving American refinery companies today at their lowest level of capacity in more than a half decade,” Biden wrote.  “But at a time of war, refinery profit margins well above normal being passed directly onto American families are not acceptable.”

Policy, Not Profits

McConnaughey said oil refining capacity in Wyoming and the nation has indeed dropped over the last few years, but the decline is due more to policy than profits.  He said refiners are doing what they can to keep up with demand.

“Nationwide refining capacity is something like 93%, so when you’re running that high at utilization, that is a weak argument,” he said. “They are operating now at about as close to max as you can get.” 

Last we saw for our region — Colorado, Wyoming and Utah — we were running almost at 99 percent capacity, he continued. “That’s pretty good utilization in the Rocky Mountains.”

 According to the U.S. Energy Information Administration, five Wyoming oil refineries had the capacity to refine 177,500 barrels of oil per day in 2017.  That went down to 168,500 for the next three years.  In 2021 capacity fell again to where it is presently at 125,850 barrels.  Wyoming has one less refinery now than in recent years.  Today there are oil refineries in Casper, Sinclair, Douglas and Newcastle. The refinery in Cheyenne is being rebuilt to produce renewable diesel.

EPA

McConnaughy said the drop in capacity in 2021 was mainly due to the conversion of the refinery in Cheyenne.

That conversion was was the result of the Environmental Protection Agency failing to renew the exemptions for the federal requirements that refineries blend fossil fuels with a certain percentage of renewable fuels such as ethanol. 

Biden told oil company executives that they could take immediate actions to increase the supply of gasoline, diesel and other refined products, thereby reducing prices, but McConnaughey wasn’t sure what the president meant by that statement.

 “It’s not like flipping a switch and getting more capacity,” he said. “That is kind of the hypocrisy of the president’s letter — asking for an increase in capacity on one side and then on the other side his policies are making it more difficult for investors to invest in the oil and gas industry.”

Major Investment

McConnaughey said increasing refinery capacity in Wyoming and the nation would require major investment.  Some companies are looking at such increases, but it would be years out, he said.

He added the president’s letter was just another attempt by the administration to shift blame and direct the outrage that high oil and gas prices are causing away from the administration and on to oil and gas companies. 

“His administration is doing everything it can to shut down the industry and attack them when polling doesn’t look like it is in his favor,” McConnaughey said.

COVID did spark a loss in refining capacity in the U.S., but many of these reductions were already planned or underway, according to the American Fuel and Petrochemical Manufacturers.

“Political and financial pressure to move away from petroleum derived fuels, costs associated with federal and state regulatory compliance and facilities’ singular economic performance all inform these decisions,” the group said.

What can be done?

Biden wrote that if the oil companies would not help maintain and expand fuel supply, his administration “is prepared to use all reasonable and appropriate Federal Government tools and emergency authorities to increase refinery capacity and output in the near term…”

Energy Secretary

Biden directed Secretary of Energy Jennifer Granholm to convene an emergency meeting with oil companies and the National Petroleum Council, scheduled for Thursday.

Biden asked refiners prior to the meeting to provide the secretary with an explanation of any reduction in their refining capacity since 2020.  He also asked for ideas on how to address inventory, price and refining capacity issues in the coming months.

McConnaughey said his organization is advocating for the government to do everything it can to increase supply.  Increased drilling in Wyoming would be helpful, as would be working with global partners to refine and transport oil and gas to make it easier to distribute, he said.

McConnaughey said Putin, with his attack on Ukraine, does share some of the blame, but policies in the U.S. could be improved and changed.   McConnaughey said renewable fuel standards and leasing royalty rates were two examples.

“We hope that Secretary Granholm will come away from the meeting with a willingness to work with the industry as we meet the challenges our industry is facing,” he said. “Workforce and supply chain issues continue to hamper development, and federal policies make it difficult to kickstart drilling on federal lands.”

EPA Denies Sinclair’s Exemption For Ethanol Content

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By Leo Wolfson, Cowboy State Daily

One of Wyoming’s three oil refineries is among 36 nationally to have its request to be exempted from biofuel blending rules refused.

Documents filed in the U.S. Court of Appeals showed the Sinclair Refinery near Rawlins applied with the U.S. Environmental Protection Agency for an exemption from the rules, but the application was denied April 7.

While the state’s other two refineries, Sinclair Casper Refining Co. and the Wyoming Refining Co., in Newcastle are listed in the court documents with Sinclair Refinery, there is no way to tell if they asked for the exemption.

Oil refineries are required to blend a certain amount of soybean or corn-derived fuel into their gasoline product under the Renewable Fuel Standard administered by the EPA, or, in the alternative, purchase compliance credits.

Small refineries, those processing less than 75,000 barrels of crude oil a day, can claim the biofuel requirements pose a “disproportionate economic hardship” and seek an exemption.

All three of Wyoming’s crude oil refineries meet the production requirements aspects of this waiver. 

The 36 refineries addressed in the EPA’s decision had all asked for exemptions for the 2018 production year. The exemptions were granted in 2019, but in 2020, a federal court adopted much more stringent rules facilities had to meet to qualify. 

One Wyoming refinery, HollyFrontier in Cheyenne, stopped processing crude oil and is transitioning to full biofuel production, a move that led to the layoff of 200 workers in 2020.

U.S. Sen. Cynthia Lummis, in an opinion piece in “The Hill,” said HollyFrontier’s decision was influenced by the plant’s loss of its exemption to the blending requirement.

“Many small refineries seek these small refinery exemptions annually,” Lummis wrote. “To remain competitive, they have no other choice. The cost of compliance credits is commonly their second-highest production expense, trailing only the cost of crude oil.”

Lummis also spoke on the poor timing of the decision in relation to rising gas prices. She said the compliance credits within the Renewable Fuel Standard program add 30 cents to 50 cents to the cost of a gallon of gasoline.

Lummis said the EPA has also indicated it will deny all requests for exemptions for production years from 2019 to 2021.

Decisions against the exemptions further limit the ability of American refineries to meet demand for gasoline, said Ryan McConnaughey, director of communications for the Petroleum Association of Wyoming.

“We still see an increase in demand for petroleum products in Wyoming and across the globe,” McConnaughey told Cowboy State Daily on Friday. “The recent increases in gas prices show the need for production.”

However, the biofuel and petroleum industries are at odds over the blending rules.

The Renewable Fuels Association, in a statement about the EPA’s decision to deny the exemptions, said the exemptions address past wrongs by refineries, but the EPA’s decision did not do enough to remedy economic problems created by the exemptions in the past.

The RFA also opposed the EPA’s plan to give 31 of the refineries whose exemptions were rejected an alternative to buying compliance credits.

To receive relief, the 31 refiners must resubmit compliance reports for 2018 and report their fuel production for that year and other data.

“EPA is granting this compliance flexibility because the agency has determined that there are extenuating circumstances specific to this set of petitions, including the fact that SRE petitions were previously granted,” the department said in its SRE announcement.

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Biden Ethanol Plan “Hypocritical” And Won’t Have Impact On Oil, Corn Industries

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By Jim Angell, Cowboy State Daily

A federal plan aimed at reducing gas prices by allowing the increased use of ethanol in some gasoline sold around the country should have little effect on Wyoming oil production, an industry expert said.

However, the added demand for corn that could result from the switch might bring higher prices for Wyoming’s corn producers, according to a spokesman for the Wyoming Department of Agriculture. 

President Joe Biden on Tuesday announced plans to allow the use of gasoline containing 15% ethanol — called E15 — during the summer months. Sales of the fuel, which is about 10 cents per gallon cheaper than regular gasoline, had previously been banned in the summer because of concerns it generates more pollution than regular gas during those months.

But only about 2,300 stations in the United States sell E15, which means the extended period of sale will probably have little impact on Wyoming’s oil production, said Ryan McConnaughey, director of communications for the Petroleum Association of Wyoming.

However, the plan shows a certain level of hypocrisy on the part of the Biden administration, which has been discouraging domestic oil and gas production, because of believes E15 causes more pollution in summer months than regular gas, McConnaughey said.

“I think creating these changes, which really won’t have a huge impact on gas prices, is proof the administration cares more about its optics than it does about addressing prices at the pump, which could be done by spurring the production of oil and gas,” he said.

The change will probably also have little direct impact on the amount of corn sold in the state, said Derek Grant, a spokesman for the state Agriculture, because little of the corn raised in Wyoming is used for ethanol.

However, the increase in demand for corn could lead to higher prices paid Wyoming producers, he said.

“What it could possibly do is improve the market for corn and if the prices go up for corn, that will obviously be good for any corn producers,” he said.

Because most of Wyoming’s corn is grown for use as feed, that might also mean a boost in prices for the state’s livestock producers, he said.

“When the market goes up for one commodity, it unfortunately has an impact on others,” he said.

According to the U.S. Department of Agriculture, about 79,000 acres of land was planted into corn in Wyoming in 2021, generating about 10.4 million bushels.

Grant said most of the state’s corn is raised in its southeastern corner near Torrington and in northern Wyoming in the Big Horn Basin.

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State Could See Economic Jump From Rare Earth Deposits In Northeastern Wyoming

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By Kris Wendtland, Cowboy State Daily

Two companies are working to develop and process rare earth deposits in Wyoming in the face of escalating demand for the valuable elements.

Wyoming Rare USA in late March began drilling in exploration of rare earth elements in Albany County west of Wheatland.  In October, Rare Element Resources started working on a rare earths demonstration processing facility to be built in Upton.

The work comes as the demand for rare earths escalates, with uses ranging from cell phones and air conditioners to electric cars and defense applications

Marty Weems, president for American Rare Earths, the parent company for Wyoming Rare USA, said his company’s work in Albany County is an attempt to determine whether a rare earth mine in the area would be profitable.

“It’s definitely not yet a mine,” he said. “We’re not a mining company.  We’re what’s considered a mineral exploration company.  Once a discovery has been made on the surface, we come in and do the planning, evaluating, and engineering. We determine if it can be made into a technically viable product with the goal of making it shovel ready.”

Electric motors, such as those used in vehicles and air conditioners, are major consumers of rare earth minerals, Weems said, and the demand for such motors is growing as countries develop globally.

“When people come out of poverty, first they buy a refrigerator and then they buy an air conditioner,” he said. “So when people come out of poverty, the demand for products that have rare earths in them increases.”

Upton Demonstration Plant 

Rare Element Resources Inc., a Wyoming corporation, is working to develop an Upton demonstration plant that will separate rare earths from raw ore removed from the Bear Lodge Mountains near Sundance.

A consortium that includes Rare Element Resources was awarded nearly $22 million by the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy.  

The DOE money will pay for half of the engineering, construction, and operation of the rare earth separation and processing plant in Upton.  The plant is expected to provide pure neodymium and praseodymium, rare earths that make incredibly strong magnets.

Randy Scott, president and CEO of Rare Element Resources, said General Atomics, a defense contractor, has invested in the processing plant, demonstrating the importance of rare earth minerals to defense applications.

“The national security aspect of rare earth mining is just critical,” Scott said.  “The investment [by General Atomics] is driven by their knowledge of the defense industry’s reliance on systems which make use of those materials.”

The U.S. Department of Defense is not a major consumer of rare earth minerals, Scott said, but it needs a stable source of the minerals.

“The Department of Defense is not a huge consumer of magnets made with rare earth.  But what they do consume is extremely critical,” he said. “If you can’t assure yourself of a domestic source of that and have to depend on China, you’re in big trouble.”

Weems agreed with Scott on the importance of rare earths to national defense.  

“This particular industry and supply chain are of really serious interest to the Department of Energy and the Department of Defense,” he said. “They are currently concerned that almost the entire supply chain goes through China.  If you have a supply chain that goes through a potential adversary, it can get worrisome if things get kinetic.”

The federal government has identified rare earth elements as one of the 35 items critical to national security and domestic economic prosperity. 

Eight rare earth elements are used in mobile phones.  Six are used in hybrid vehicles.

Just three of the rare earths critical to national defense are: 

◆ Neodymium — More magnetic than any other element.  That makes it a good choice for use in missile guidance systems.

◆ Lanthanum — Makes glass easier to see through, making it important for surveillance and reconnaissance camera lenses.

◆ Samarium — A key component of traveling wave tubes, the “backbone of the world’s entire space communications system” says a contributor to Physics Today. https://physicstoday.scitation.org/doi/full/10.1063/PT.3.4872

All three are among the rare earth elements found in Wyoming.

UW Playing A Big Role In Development

University of Wyoming researchers have determined the state could be home to large rare earth element deposits, said Scott Quillinan, senior director of research for the university’s School of Energy Resources.

“Wyoming has some interesting and potentially large rare earth element resources,” he said.

He pointed specifically to the deposit in the Bear Lodge Mountains that Rare Element Resources plans to process at its Upton demonstration plant.

“(It) is often referred to as one of the largest unmined rare earth deposits in North America,” he said. “(Western Rare Earths) is working on defining the rare earth element resources of Red Mountain pluton in Albany County.  So that’s two, potential, mineable deposits in Wyoming.”

Several other UW researchers have focused their efforts on evaluating the presence of rare earth elements from Powder River Basin coal ash collected from four power plants.

The researchers, in a paper published in “Renewable and Sustainable Energy Reviews,” revealed that the ash could provide rare earth elements that could be extracted economically.

The findings are important because “China and Southeastern Asia dominate all parts of the REE market value chain – from extraction and production to final consumption in the manufacturing sector,” according to work done by UW’s Melissa Firestone and Jada Garfalo, both researchers with UW’s School of Energy Resources.

Workforce Needed Over Next Two To 10 Years

The construction of Rare Element Resources’ demonstration plant should be an economic boon for northeastern Wyoming.

Assuming the knowledge and skills are available, the plant will be built and operated with local workers where possible, Scott said.

He added the company already has 1,000 tons of material to process at the plant, which should help reduce America’s reliance on China for some rare earth elements.

“We aren’t producing a concentrate that has to go to China to be processed,” he said.

Wyoming’s experience with coal production should help provide Rare Element Resources with the labor force it needs, he added.

“This is a tremendous state to be working in,” he said. “Wyoming has quite an established workforce in coal mining that we can borrow from.  Those are the types of people we need for maintenance and construction jobs.”

Some training will be needed for the workers who run the plant, Scott added.

“There will be laboratory analysis, process design, and engineering work on the chemical processing side, plus process and engineering work on the mechanical and industrial side,” he said.

In Albany County, if Western Rare Earths’ drilling results in a rare earths mining operation, the operation will need local employees.  That timeline is quite a bit longer than the timeline for the Upton facility, but, assuming a mine is feasible, Weems said, this could “be a big construction project.”

“It wouldn’t be a little thing,” he said. “Those construction capabilities would be a big need for probably a year or more. On similar projects, after construction, there have been 200 to 300 high paying mining jobs.”

The area could also expect the creation of related jobs in the form of support positions at the mine, along with increased consumer activity.

“When a new mine comes to a community, there’s another 250 jobs created that support the jobs at the mine, more hardware to fix the house, more groceries, more jobs in the community that aren’t directly related to the mine, but support the people who work at the mine and support the mine functions,” he said.

As the rare earth element industry picks up speed, the UW is working new systems for mining and production, Qullinan said.

“The School of Energy Resources is hoping to develop methodologies for the entire supply chain of rare earth materials, methodologies for exploration and mining, separation and processing, beneficiation or enriching materials, as well as value-added processes, business plans, economics, and workforce development,” he said. “We want to develop a wells-to-wheels type of program.”

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Fed Law Enforcement Warns Russian Hackers Could Target Wyoming Critical Infrastructure

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By Jennifer Kocher, Cowboy State Daily

Federal law enforcement officials are warning that Russian hackers are targeting refineries, pipelines, power grids and other critical energy infrastructure in the United States, including in Wyoming.

However, historically, the weather has posed a bigger  threat to Wyoming’s energy infrastructure than hackers, according to records.

In late March, the Department of Energy and other federal agencies issued a joint Cybersecurity Advisory (CSA) warning regarding state-sponsored Russian cyberattacks on the energy sector in the U.S. and elsewhere.

The warning follows an investigation by the Cybersecurity Infrastructure Security Agency (CISA), the Federal Bureau of Investigation and the U.S. Department of Energy (DOE) that identified multiple targeted attacks on the energy infrastructure between 2011 and 2018.

Pipelines have historically been a target of hackers, according to Ryan McConnaughey, communications director for the Petroleum Association of Wyoming (PAW), who pointed to the 2021 ransomware on the Texas-based Colonial Pipeline that was tied to a Russia-linked cybercrime network.

So far, to McConnaughey’s knowledge, Wyoming’s energy sector has not been hit by Russian or other hackers.

“The individual energy companies and industry as a whole and their partners work with CISA and DOE to look into the future to try to mitigate the risks,” he said.

The warning of heightened concerns by the federal government doesn’t come as a surprise, he noted, adding that the industry has people working on cybersecurity on a full-time basis to prevent such attacks and that the companies regularly work together to share information about potential threats.

Historically, records show the biggest threat to Wyoming’s energy sector has been thunderstorms and lightning.

Between 2009 and 2019, thunderstorms and lightning accounted for $7 million in overall property loss each year, according to an Energy Sector Risk Profile prepared by the DOE. During this time, the state had eight major disaster declarations.

The second largest hazard was floods, with 19 accounting for $3 million in damage each year during that same period.

The third largest cause of damage to the infrastructure was wildfires. The federal reported that between 2009 and 2019, the state saw five fire management assistance declarations. Fire damages to the infrastructure are estimated at $2 million per year.

Potential Targets

In terms of its energy infrastructure, Wyoming has 27 electric utilities, 28 natural gas processing facilities and two liquefied natural gas plants with a storage of 6,051 barrels, per the report.

Additionally, as of 2018, there were 6,838 miles of natural gas transmission pipelines and 5,429 miles of natural gas distribution pipelines running through the state.

Between 1984 and 2019, the report stated that the largest disturbance to the state’s natural gas distribution system came from unknown events and outside forces while the gas was being shipped via pipelines.

In addition to gas lines, as of 2018, Wyoming had 4,257 miles of crude oil pipelines and an additional 1,379 miles of pipelines for refined products.

The report cited no cyberattacks on any of the state’s energy infrastructure.

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Global Mining Business Finds Significant Deposits Of Uranium In Wyoming’s Red Desert

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By Clair McFarland, Cowboy State Daily

A global mining business says it has found significant deposits of uranium in Wyoming’s Red Desert.  

GTI Resources discovered a likely source of raw uranium, or yellowcake, through a first-time exploratory drill program called the “Thor” project in the Great Divide Basin, said Bruce Lane, GTI Resources director.

Lane added the geological and political landscapes would appear to encourage development.

“We’re confident we have established there’s a mineralized system here,” Lane told Cowboy State Daily.

Lane hoped to release an official report by mid-April that will detail how much uranium the area might contain. 

Wyoming’s geologic structure, said the director, is ideal for in-situ leach mining – a relatively “clean” process using water and baking soda to pump uranium deposits from drilled holes.  

The next step, said Lane, will be for GTI to “follow this drilling program with another drilling program of higher intensity” to further identify the yellowcake presence and develop an “economic model” around it before tackling the official permitting process.  

The permitting process for uranium production, said Lane, is “onerous – as it should be” to address environmental concerns.  

Lane said this initial discovery of sandstone-embedded uranium in southern Wyoming comes amid the industry’s first optimistic phase in more than a decade.  

“Uranium mining in the States has really collapsed in the last decade, so in the last few years there’s been no mining at all,” said Lane, noting that Kazakhstan flooded the global market nearly two decades ago with cheap uranium which, at about $20 per pound, drove out established producers and stalled Wyoming ventures.  

Lane also bemoaned the 2010 sale of Uranium One assets to Russian nuclear power giant Rosotom – a move that was approved by then-U.S. Secretary of State Hillary Clinton which transferred 20% of U.S. uranium reserves into Russian control.  

“It’s quite incredible to think… somebody decided in the administration that that was a good idea,” said Lane.  

With the transfer, Russia took over much of the global uranium enrichment services for turning raw yellowcake into refined uranium, Lane said, adding that now there is “some enrichment in the U.S.” 

A Trump-era report by the National Nuclear Security Administration stated the U.S. in 2019 did “not have domestic uranium enrichment capability,” prompting the Navy to use national stockpiles for the propulsion of its nuclear-powered vessels.  

Foreign Chaos 

But the tides turned in January, when civil unrest in Kazakhstan prompted Russia-aided communications and travel shutdowns that quelled both civilian protests and uranium production in the small central-Asian country. Kazakhstan had been producing more than 40 percent of the world’s uranium supply.  

Prices surged to $45 per pound in January and $55 on Wednesday evening.  

Consumers, or “utilities,” said Lane, may find it “better for them to seek uranium from a more politically stable place than Kazakhstan.”  

The Russian-Ukraine conflict now waging, Lane added, could further cement “the strategic issues with buying out of the Russian block, and Chinese-block-aligned suppliers.”  

Kazakhstan, Russian, and Uzbekistan accounted for 47% of the total uranium purchased by U.S. civilian operators in 2020, according to the U.S. Energy Information Administration. Canada and Australia together were the second-largest sources for American buyers, providing about 34% of the supply.

America’s export rate was not as voluminous or as lucrative:  

U.S. buyers bought 39.6 million pounds of uranium from foreign sources at an average $33.79 per pound in 2020 – but domestic producers only sold 9.9 million pounds, at an average price of $29.57 per pound, the EIA reported.  

Energy Independence 

Russia’s invasion of Ukraine provoked criticism and calls by Wyoming’s three Congressional delegates for bans and sanctions on Russian products.  

“Now you’ve got Liz Cheney banging the desk and demanding that Russia be sanctioned, and that uranium be sanctioned as well, and oil and whatever else,” said Lane. 

Shifting that pressure to meet the demand for uranium back onto American suppliers, he continued, is a “wakeup call, that the U.S. domestic uranium supplier used to be the world’s leading supplier business – and it’s been decimated, and effectively collapsed.” 

“But I believe there’s a renaissance underway,” he added.  

Clean Power 

Lane referenced an increasing demand for clean energy.  

“Emissions-free electricity can’t all come from windmills and solar power,” he said, due in part to their intermittent nature and “network issues.”  

India, France, South Korea, Japan, and many other jurisdictions are “doubling down” on nuclear power, Lane added.

Uranium mining is not without its environmental risks, he said, as some producers will use harsh chemicals to extract the yellowcake. But Wyoming’s sandstone-hosted deposits, he said, allowed for the cleaner alternative of in-situ extraction.  

Wyoming Hands on Deck 

Australia-based GTI Resources, said Lane, is employing Wyoming workers.  

“We don’t have exploration staff and filed staff employed in the U.S., so we work with partners in the U.S… (and) we absolutely would use and would prefer to use local, Wyoming expertise. I don’t imagine why we would want to bring anyone in from out of state,” he said. “These guys are trustworthy and reliable.”  

Lane also praised the Wyoming Legislature for its exploration-friendly policies.  

“I’ve worked in a number of different jurisdictions across the world, and it’s really good to work with people in your part of the world,” said Lane. BRS Engineering, which is based in Riverton, helped GTI choose exploration targets in Wyoming and in Utah.  

“For the Thor project,” said Doug Beahm, principal engineer for BRS, “we planned and permitted the drilling through the (Wyoming Department of Environmental Quality) Land Quality Division and (Bureau of Land Management).” 

With permits in place, BRS managed drilling, completing 100 exploratory drill holes on the Thor project this winter.  

“We did not get the permit until late November 2021 and had to complete the drilling prior to March 15,” said Beahm, due to seasonal wildlife restrictions pertaining to sage grouse. 

But the project was completed on time.  

“GTI has additional claim groups in the Great Divide Basin of Wyoming and we will be evaluating whether to continue the drilling program at Thor or expand the program to the other claim groups or do both,” Beahm said.  

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Ban On Russian Oil Not Likely To Help Wyoming Industry Unless Biden Lifts Restrictions on Federal Lands

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By Clair McFarland, Cowboy State Daily

A presidential ban on the import of Russian petroleum products could help Wyoming, according to experts, if the federal government would lift its own restraints on American producers.  

“We’re obviously in agreement with (President Joe Biden’s) decision to ban Russian oil,” Ryan McConnaughey, vice president of the Petroleum Association of Wyoming, told Cowboy State Daily on Wednesday. “But we’ve seen several actions by the administration that have hindered the ability to develop, specifically on federal lands.”  

Russia had contributed about 8% of America’s petroleum products, including 3% of its crude oil supply. On Tuesday, Biden announced he had banned the import of Russian oil in retaliation for Russia’s invasion of the Ukraine. 

But Wyoming’s oil industry probably won’t be a big player in making up the difference in the national oil supply, said McConnaughey, because it depends heavily on the availability of federal lands for production.  

The leasing of federal land for oil development has ceased under the Biden administration despite a June court order to revive U.S. Bureau of Land Management oil leasing on federal lands. The permitting process is under a severe backlog as well.

Wyoming tops the nation for natural gas production on federal lands and is second only to New Mexico for oil production on federal lands, said McConnaughey. 

Instead of Wyoming, energy development companies have been setting up shop in states with more state- or privately-owned land, he continued, to avoid the federal permitting shutdown.   

No Leasing, No Permitting 

The administration has offered no federal land parcels for lease since December 2020, McConnaughey said, in violation of federal law. In addition, the BLM has not approved any permit applications for production on federal lands since last fall.

The Biden administration in June was ordered by U.S. District Court Judge Terry Doughty to lift its moratorium on federal leasing, but still has not complied.  

There are about 4,600 permits to drill awaiting federal approval nationwide, said McConnaughey.  

“Those companies cannot drill on those lands without those permits,” he added.  

Wyoming’s share of the ungranted permits nationally is about 10% at 469 – putting the state in second place after New Mexico, which has 3,809 ungranted permits caught up in the federal system.  

“I think immediately, the administration could work to streamline getting those permits approved, to get more oil on the market,” said McConnaughey.  

Too Little Too Late? 

But former Wyoming Sen. Eli Bebout worried that even if the Biden administration did change course with the leases, it may be “too little too late.”  

“If (Biden) all of a sudden woke up tomorrow and became a reasonable person and recognized the value of our domestic oil and gas industry, you just can’t turn the switch on,” said Bebout, the owner of Nucor Oil and Gas.

He added any substantial production increases from allowing leasing and permitting immediately likely wouldn’t be seen in Wyoming for another six months to one year, because of the slow process of hiring qualified workers and establishing rig sites.  

“If he’d let (the embargos) go, like, a year ago, we would be able to do a lot better, and I don’t think we’d be suffering the high gas prices we are,” Bebout told Cowboy State Daily.  

Wyoming’s average unleaded gasoline price Wednesday was $3.92 per gallon, an increase of 44.4 cents from one week ago and a jump of nearly $1.19 from last year.  

Bebout stated that there’s “no way” Wyoming would have a substantial role in making up the lost 8% of petroleum products caused by the Russian oil ban, even if the federal restrictions were lifted. 

“It’s not going to have an impact in terms of what the Russian deal does,” said Bebout, adding that the more noticeable benefits in a less restrictive market would be increased state revenues and a better job market. 

Biden Rallies for ‘Clean Energy’ 

Wyoming Gov. Mark Gordon and 25 other state executives asked Biden on Friday to remove bans on new oil and gas development on federal lands and restart the halted Keystone XL pipeline project.  

“People in our states cannot afford another spike at the gas pump, and our allies cannot afford to be held hostage by (Russian President Vladimir) Putin’s tyranny and aggression,” reads a statement by Gordon’s office. 

Biden in a Tuesday statement on Twitter, resisted calls to unburden domestic oil producers.  

“Loosening environmental regulations won’t lower prices,” wrote Biden. “But transforming our economy to run on electric vehicles, powered by clean energy, will mean that no one will have to worry about gas prices. It will mean tyrants like Putin won’t be able to use fossil fuels as a weapon.” 

Europe Hurting 

According to The Associated Press, the European Union this week will commit to phasing out its reliance on Russia for energy needs as soon as possible. Europe relies on imports for 90% of its natural gas and 97% of its oil products. Russia supplies 40% of Europe’s natural gas and a quarter of its oil. 

The U.S. does not import Russian natural gas. 

Bebout said Russia’s invasion of Ukraine has been a “travesty,” but he worried that the American minerals sanction and other importation bans worldwide would hurt the Ukrainian and Russian civilians far more than the Russian ruling class.  

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Ukranian Invasion Drives Up Wyoming Gas Prices; No Relief In Sight

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By Jennifer Kocher, Cowboy State Daily

Gas and oil prices skyrocketed this week as Russia ramped up its attack on Ukraine, and experts said those price increases would continue, at least in the short-term.

Wyoming’s oil and gas prices escalated quickly this week as the price of oil leapfrogged overnight. 

As of Wednesday morning, the primary global price benchmark used to set the price for two-thirds of the world’s crude oil increased by 6.5% from Tuesday to top at $112 a barrel, coming on the heels of Tuesday’s historic 9.5% increase.

The escalation in crude oil prices has translated to higher gas and diesel prices at the pump as Wyoming’s average price for a gallon of regular gas hit $3.46 a gallon Wednesday compared to $3.34 last month, according to AAA. This is up from $2.59 a gallon a year ago.

The pinch at the pump is already affecting families in Wyoming forcing some to make hard choices.

For Gillette resident AshLee Avila and family, the increased fuel costs, along with inflation raising the cost of living generally, mean that her two sons, both of whom wrestle in school, are now having to pick and choose which meets they attend. Or they take turns carpooling with other families, so the boys can attend as many wrestling meets as possible, many of which are in neighboring states.

“It’s not only the price of gas but everything else has gone up,” she said. “It’s so frustrating. Plane tickets have gone up, food and definitely fuel prices. A lot of other families are having to do the same thing, so these kids can still get to have these great opportunities.”

Fuel Prices On The Rise

But there is no relief in sight, according to experts.

Fuel prices will continue to rise, at least in the short term, according to economist Rob Godby, who noted that conflict in Europe has sent the oil market reeling worldwide. 

“The leap has been pretty dramatic,” said Godby, associate economics professor at the University of Wyoming and interim dean of its business college, “but not surprising given the geopolitical climate.”

Some economists are predicting that the national average gas price will rise to $5 a gallon, but Godby wasn’t making any predictions given the number of unknowns in the rapidly developing Ukraine crisis. 

The price fluctuations, Godby said, are a response to the number of new risks that have toppled traditional supply and demand ratio that the world has experienced in the past decade of relative geopolitical calm.

“The world has kind of rediscovered risk premium rides that have been missing from oil markets for the past decade,” he said. “We used to take for granted that some percentage of oil prices, when they regularly hovered about $100 a barrel, was just due to the geopolitical risks the oil market was facing.”

Typically, prices factor in probabilities and the percentage of risk, which until two weeks ago was still fairly insignificant and now those risks are real, and the market is responding, he said.

Also unprecedented is the severity of sanctions and other responses against Russia taken by both the U.S. and NATO and other European nations that have effectively cut off the world’s third largest oil producer from doing business.

Currently, Russia supplies about 11% of the world’s oil production, according to the U.S. Department of Energy. The top producer is the U.S. at more than 18 million barrels per day, which equates to 20% of the world’s total supply, followed by Saudi Arabia at 12%.

What remains to be seen at this point, Godby said, are the impacts of a number variables, such as how Russia responds to the sanctions, how long the conflict continues and how the rest of the world responds to Russia’s actions.

As a result, while the long-term picture is unclear, the market is responding to these various uncertainties with higher prices in the short term.

Godby was hesitant to predict how high prices might get, but shared a formula for oil prices and their impact on gas prices that shows the price of gas goes up by 3 cents per gallon for every $1 increase in the price of a barrel of oil.

Using that formula, the price of oil would have to hit more than $150 per barrel, he said.

However, if that were to happen, more producers such as Saudi Arabia and the United States would likely ramp up production, bringing prices down, he said. At the same time, demand for gas would plummet as people would cut down on the amount they drive.

Regardless of gas price increases nationally, Wyoming and the Mountain West tend to have lower fuel prices compared to other states due to their relatively low gasoline taxes. 

Wyoming has a combined federal and state excise tax of 42.4 cents per gallon compared to high-tax states like California with an 87-cent per gallon rate, according to the American Petroleum Institute.

“Gas is going up across the country, but gas prices are always going to be lower in Wyoming,” Godby said. “There’s the one silver lining.”

Wake-Up Call

Many in the state like Ryan McConnaughey, vice president and director of communications with the Petroleum Association of Wyoming, view the current situation as a much-needed wake-up call.

In particular, McConnaughey urged the Biden Administration to proceed with lease sales on federal land, allowing the state to produce more oil.

For the past five quarters, the administration has refused to hold its quarterly lease sales. In the last quarter, the ban prevented 195 leases from being released for development.

Currently, there are 18 oil rigs active in Wyoming, a decline of 16 from one month ago.

Rather than cripple U.S. oil and gas producers in favor of foreign imports, McConnaughey said the current crisis is a reminder of why energy independence is so important to the country.

“We need to see the administration embracing and recognizing the need for domestic production,” he told Cowboy State Daily Tuesday. “With what’s happening in Europe now, we need to encourage development in the state.”

Admittedly, McConnaughey noted, the U.S. has relied little on Russian oil and gas imports, although the amounts imported have grown steadily through the years.

Currently, Russia supplies 3.1% of total U.S. crude oil imports, according to the U.S. Energy Information Administration (EIA). In 2021, these imports – mostly light and medium grade oil that primarily went to the East and West coasts – amounted to nearly 70 million barrels during the first 11 months of the year valued at $4.7 billion, representing the highest import volumes since 2011.

“We see an opportunity to replace that,” McConnaughey said, “and it’s our belief that the administration should follow the law and do the right thing.”

Paying More At The Pump

In the meantime, Wyoming residents have no choice but to pay more for gas.

The cheapest gas in the state, $2.95 per gallon, can be found in Cheyenne, according to GasBuddy.com, with the majority of gas stations throughout the state charging $3.15 and more per gallon.

At Gillette’s Maverik on East Highway 14-16, where the price at the pump was $3.25 per gallon, resident Mike Bednarz was putting $20 in his pickup truck Wednesday morning for just over six gallons of regular gas.

He never fills up his tank regardless of the cost, he said, because he’s not sure when “the old girl” is going to die, though he definitely gets fewer miles for his money these days.

Bednarz blamed the current administration for its reliance on oil imports as opposed to drilling in the U.S. where states like Wyoming could reap the benefits in terms of increased tax revenue and jobs while driving down gas prices.

Lisa Shrefler of Gillette agreed.

“I think it’s an absolute disgrace that our current administration felt it was more important to buy those resources for double the price from overseas, so they could apparently keep filling their own pockets financially versus looking out for their own country,” she said.

The spike in prices for gas and other goods is having a direct impact on her life, she said. She retired last year and is living on a fixed income. Prior to gas price increases, she was running errands pretty much every day but now has to schedule her errands for one day a week and carefully map out her route.

Bednarz, meanwhile, is not letting the increased cost per gallon slow him down.

“I’m not going to let it control my life,” he said. “Otherwise, I might as well just sit home watching re-runs of ‘Andy Griffith.’

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U.S. Power Plants Short On Coal; Utilities Scrambling With Cold Temps Ahead

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By Jimmy Orr, Cowboy State Daily

The price for Wyoming’s coal is rising in the face of low supplies at power plants across the country, rising natural gas prices and predictions of cold temperatures in the near future.

Despite efforts by some political leaders to halt the use of coal as an energy source, energy producers are turning to the fuel in increasing numbers this year, only to find it in short supply.

But coal supplies at U.S. power plants have dropped to levels not seen since the 1970s and acquiring the resource has sent prices soaring. And even acquiring coal is proving to be a challenge because of supply chain issues that every industry is experiencing.

None of this is a surprise to Travis Deti, the executive director of the Wyoming Mining Association.

“We’ve been screaming from the rooftops for the last 10 years that America needs coal and that you can’t throw all of your eggs in one energy basket,” Travis told Cowboy State Daily on Tuesday.

“(Natural) gas prices were never going to stay below $2.00 (per 1,000 cubic feet) forever. Gas is at about $4.60 and some analysts are predicting it to be over $7.00 in the winter,” he said.

The problem is that coal is sold in advance of when it is needed and because of the push to move away from coal as a power source, the resource has lost market share, leaving suppliers unprepared to meet this year’s demand.

Getting coal back on the table as a fuel is easier said than done.  As Deti explained, the problem does not lie in a shortage of coal, but in producing the necessary amounts to meet that demand. After adjusting to lower production levels, coal producers require manpower to boost production again.

“Ever since the decline started to happen a decade ago,  we said you need to keep coal in the mix.  You gotta keep it in the mix,” Deti said.

Coal is the one resource, he said, that is “always affordable, always reliable, and always abundant.”

“As for reliability, coal-fired power is going to be there when you turn on the light switch,” he said. “Unlike the renewables which we saw, fatally, in Texas last winter.”

The Wall Street Journal reports that coal supplies have become so low in some areas of the country that one power company that serves one-fifth of the U.S. population is reserving coal for use during the coldest days this winter.

The high price for coal is a good thing for Wyoming, especially if mines can get it out of the ground.

However, there’s a shortage of workers. Deti said mines in the Powder River Basin could use an extra 200 miners right now, as well as more trains to move the coal.

“You’ve got companies up in the basin right now that are offering $5,000 signing bonuses just to come on board,” he said. 

Deti said the short-term prospects for coal is good.

“The basin is sold-out for 2022,” he said. “They are selling into 2023. We are going to have a couple pretty good years.”

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Biden Gears Up For Renewed Fight Against Oil And Gas

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By Casey Harper, The Center Square

A federal judge has ruled the Biden administration must resume allowing oil and gas leasing on federal land and waters, but the administration is saying it will not go down without a fight.

The Biden administration said it will appeal a court ruling allowing the leases, the latest development in a months-long battle between President Joe Biden and the oil and gas industry, even as gas prices continue to rise.

“Together, federal onshore and offshore oil and gas leasing programs are responsible for significant greenhouse gas emissions and growing climate and community impacts,” the Department of Interior said in a statement.

Biden issued an executive order on his first day in office banning new oil and gas leases on federal lands and waters.

“The United States and the world face a profound climate crisis,” the executive order said. “We have a narrow moment to pursue action at home and abroad in order to avoid the most catastrophic impacts of that crisis and to seize the opportunity that tackling climate change presents. Domestic action must go hand in hand with United States international leadership, aimed at significantly enhancing global action. Together, we must listen to science and meet the moment.”

Biden’s order sparked backlash in the industry and among states that rely heavily on oil and gas for jobs and tax revenue. More than a dozen states challenged the order in court.

Wyoming commissioned a report on the impact of the order, which found Biden’s rule would cost 350,000 jobs and $670.5 billion in GDP in Wyoming, New Mexico, Colorado, Utah, Montana, North Dakota, California and Alaska by 2040. The report also found that the moratorium would cost $639.7 billion to the nation’s GDP by the same year.

In June, a federal judge in Louisiana sided with the states.

Despite the judge’s ruling, industry leaders have complained that the Biden administration has dragged its feet in reinstating the leases.

“For six months, the Interior Department cited the Biden Ban as the reason for not holding quarterly lease sales,” said Kathleen Sgamma, president of Western Alliance, a group that represents more than 200 companies in the industry. “In the two months since the ban was overturned by a federal judge, department officials have ducked questions from lawmakers, media, and industry about when lease sales would resume. Now that the Interior Department has missed the deadline to hold any sales before October, it’s crystal clear there is no intention of complying with the judge’s order. At a recent Senate hearing, Interior Sec. Haaland admitted the president’s ‘ban on new leasing is still in place.’ Meanwhile, the Biden Administration has spent the summer lobbying OPEC and Russia to increase oil production.”

The decision comes as gas prices have continued to rise in recent months. According to the Bureau of Labor Statistics, gas prices have risen 19% nationwide in the last 12 months.

“Someone needs to explain how it makes any sense for President Biden to beg other countries for more oil while requiring a federal judge’s order to do the same within the United States,” said Larry Behrens of Power the Future, an energy workers advocacy group. “The fact that the Interior Department will appeal this ruling makes it clear: the Biden Administration prioritizes radical environmentalists first and America’s working families last. If Joe Biden wants gas prices to fall, he needs to get out of the way and let America’s energy workers get back on the job.”

The Biden administration recently called for more overseas drilling to keep gas prices down.

“Higher gasoline costs, if left unchecked, risk harming the ongoing global recovery,” National Security Advisor Jake Sullivan said in an official White House statement. “The price of crude oil has been higher than it was at the end of 2019, before the onset of the pandemic.”

That statement sparked outrage among domestic oil producers. Now, Biden is appealing the court order requiring the administration to allow new leases.

“At the same time it’s encouraging foreign oil production, the Biden Administration is preventing American production and helping drive up the price Americans pay at the pump,” Sgamma added.

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Cheney Calls For Elimination Of Electric Vehicle Subsidies

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By Jimmy Orr, Cowboy State Daily

Wyoming Congreswoman Liz Cheney on Tuesday called for the elimination of federal electric vehicle tax credits, saying they target the energy industry and only benefit “elites” who make more than $100,000 a year.

Cheney made the statement while announcing she was a co-sponsor of H.R. 3796, the “Eliminate Lavish Incentives to Electric (ELITE) Vehicles Act.”

Cheney said the bill will end the electric vehicles tax credit which she said unfairly targets the energy industry and costs billions in taxpayer funds.

“Eliminating the subsidy will save taxpayers billions of dollars and also help to protect the energy industry from the far-left’s radical environmental agenda,” Cheney said.

According to a Congressional Research Service report, 78% of electric vehicle credits are claimed by filers with an adjusted annual gross income of $100,000 or more, and those filers receive an even higher proportion (83%) of the amount of credits claimed.

Earlier this month, U.S. Sen. John Barrasso introduced identical legislation in the U.S. Senate.

Like Cheney, he mentioned that the tax credits benefit those who have the most money.

“The electric vehicle tax credit largely benefits the wealthiest Americans and costs taxpayers billions of dollars,” Barrasso said. 

“Today, the market for electric vehicles is well established. The auto industry no longer needs these pricey subsidies. It is time to pull the plug on subsidies for electric vehicles.”

A study done by the The Manhattan Institute estimates that ending the electric vehicle tax credit would save roughly twenty billion dollars in taxpayer funds over the next decade.

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Supreme Court Will Not Hear Wyoming Coal Port Lawsuit Against Washington

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By Jim Angell, Cowboy State Daily

The U.S. Supreme Court on Monday rejected an attempt by Wyoming and Montana to sue Washington over its refusal to license a proposed coal export terminal.

The court, without comment, denied a request to hear the complaint that alleged Washington officials looked beyond the environmental impacts of the port on Washington when deciding whether to license the Millenium Coal Export Terminal and made their decisions based on the impact of using coal for fuel in other countries.

A note on the Supreme Court’s website said Justices Clarence Thomas and Samuel Alito Jr. supported hearing the case, but the other seven justices ruled to deny the request.

Gov. Mark Gordon called the court’s decision “frustrating” because It leaves open the question of whether one state can block another from selling its goods.

“This case was never about a single permit or product,” he said. “It was about the ability of one state to engage in lawful interstate commerce without the interference of another state. Today it is coal, tomorrow it could be agricultural products or any of our state’s abundant natural resources. At some point the Supreme Court is going to need to take on this matter.”

The Wyoming Mining Association, which represents the state’s coal mining companies, had backed the state’s legal action.

“We’re very disappointed,” said WMA Executive Director Travis Deti. “I really don’t have much more to add on this one.”

The case stems from a decision by Washington officials to block development of the coal export terminal, which would have provided a place to load coal for shipment to overseas markets. Washington officials blocked the project’s construction on the grounds it would violate the Clean Water Act.

However, Wyoming and Montana officials, in a lawsuit filed in January, asked the U.S. Supreme Court to review the actions of Washington officials, alleging the denial violated the Interstate Commerce Clause, which gives only the federal government the authority to regulate the flow of goods between states.

The two states also alleged that Washington officials looked beyond the local impacts of the port and instead based their decision on the state’s political opposition to the use of coal as a fuel.

The company proposing the coal terminal went bankrupt earlier this year, prompting the U.S. Solicitor General to ask that the Supreme Court not take up the case because it was moot.

Wyoming and Montana officials countered that justices needed to address the question of whether Washington could interfere with the sale of Powder River Basin coal to overseas clients.

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Federal Government Took ‘Insulting’ Stances In Oil, Gas Lawsuit, Says Former BLM Official

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By Jim Angell, Cowboy State Daily

The federal government made some “insulting” arguments in its efforts to maintain a moratorium on oil and gas leases on federal land, according to a former U.S. Bureau of Land Management official.

William Perry Pendley, a former Wyoming attorney who served as the BLM’s deputy director for policy and programs under former President Donald Trump, said he found “arrogant” the federal government’s arguments that it would find a way to halt lease sales on federal property even if a federal judge in Louisiana ruled the sales must resume.

“The government says ‘Even if you tell us to keep doing sales, we have the discretion to implement the postponement with another rationale, we will find another way not to obey the law,’” he said. “It’s pretty arrogant.”

U.S. District Judge Terry Doughty in Louisiana on Tuesday granted an injunction sought by 13 states to keep the administration of President Joe Biden from blocking oil and gas lease sales on federal property.

Biden several days after taking office issued an executive order halting oil and gas lease sales on federal property pending a review of the lease program.

The lawsuit filed in Louisiana alleged the halt to sales was issued without following the proper administrative steps as outlined in the Administrative Procedures Act.

The lawsuit is similar to one filed in U.S. District Court in Wyoming by Wyoming officials, who also allege that the federal government failed to follow its own rules in adopting the ban.

In his ruling, Doughty rejected several arguments by the federal government that Pendley said he found “somewhat insulting,” including one that the 13 states involved in the lawsuit did not have the authority to challenge the federal government’s actions.

“That’s pretty outrageous that a sovereign state doesn’t have the right to come into court and try to save an economy,” Pendley said.

He added that another argument that the states were not harmed by the ban because existing oil and gas leases were not affected by Biden’s actions were not accurate because of the amount of time needed to develop a leased area.

“These things take time and the leases they issue today … are going to be drilled sometime in the future,” he said. “If they are not issued today, then we will have real trouble down the road.”

Some groups have maintained that the judge’s injunction only requires the BLM to hold oil and gas lease sales and that the BLM itself has discretion over how many parcels it will actually offer during those sales.

Pendley said he could not predict whether the BLM might significantly reduce its lease offerings to comply with the desires of the administration.

“You have a Secretary (of the Interior) who says she is opposed to fracking, a president who says he is opposed to fracking and 90% of all wells are fracked, so if you lease, you are going to have fracking,” Pendley said. “It’s entirely possible, as the government lawyers told the judge, ‘We can find a way around this.’”

However, he added it might be difficult for a government attorney to argue in defense of such an action.

“I think that would be insulting,” he said. “I don’t think a court would look lightly on that. I would not want to be the state (BLM) director who goes into court and explains to the judge how I complied with the judge’s order by putting one lease up for sale.”

Doughty declared his injunction to apply to all federal properties in the country, but Pendley said he did not believe it would stop progress on Wyoming’s lawsuit, largely because of questions over whether a judge in Louisiana can issue an injunction in effect nationally.

“There is some dispute about whether those district court judges have the authority to issue nationwide injunctions,” Pendley told Cowboy State Daily. “The important thing is I don’t believe the Wyoming district court will stand down because of this.”

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Gordon Criticizes Biden Royalties Proposal

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By Jim Angell, Cowboy State Daily

A plan to abandon a proposed mineral royalty reduction that never took effect is being criticized by Gov. Mark Gordon as the latest in a pattern of steps being taken against fossil fuels.

Gordon, in a news release, criticized the administration of President Joe Biden for trying to withdraw the royalty reduction plan offered by the administration of former President Donald Trump as another example of Biden working against fossil fuels without consulting with the country’s governors.

“The list of anti-fossil fuel actions implemented by the Biden Administration without prior consultation with fossil fuel governors just keeps getting longer,” he said. “This announcement is clearly a pattern, and the effort to justify this withdrawal based on harm to the U.S. taxpayer is disingenuous.”

The Trump administration last year proposed changes in the way oil and gas is valued for royalty payments to the federal government. The changes would have reversed some rules put in place by the administration of former President Barak Obama in 2016.

The latest rules were finalized in January, but were blocked from taking effect by the Biden administration.

The Office of Natural Resources Revenue Office on Friday announced it is proposing the withdrawal of the Trump administration rules, saying the process for their adoption “arguably was without observance of procedure required by law, as well as in excess of ONRR’s statutory authority.”

The ONRR estimated that had the Trump rules taken effect, mineral royalty payments to the federal government would have been released by $64.6 million annually.

The ONRR, in its formal proposal, also noted the reductions proposed by Trump were designed to encourage mineral production on federal lands.

“ONRR has no explicit mandate to increase production,” the proposal said.

The ONRR told E&E News that if the changes had been allowed to take effect, communities would be hurt by a reduction in their shares of royalties.

However, Gordon argued if the Biden administration was truly concerned about taxpayers, it would not have put a halt to oil and gas lease sales on federal property.

“Fossil fuel companies can only pay royalties if they are producing,” he said. “Increasing royalty rates when the coal, oil and gas industries are still attempting to recover from 2020 is just kicking the industry when it is down.”

“When those companies go out of business, no royalties are collected, less money is set aside for reclamation activities and the price of gasoline will continue to rise,” he added.

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Petroleum Association Of Wyoming Joins Lawsuit Challenging Biden’s Federal Oil Lease Ban

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By The Center Square for Cowboy State Daily

The Petroleum Association of Wyoming (PAW) has signed on as a joint petitioner in a lawsuit to fight President Joe Biden’s executive order halting new federal land leases for oil and gas drilling.

The lawsuit, initiated by Western Energy Alliance (WEA), targets Executive Order (EO) #14008 and was filed in the U.S. District Court in Wyoming.

After the Bureau of Land Management (BLM) failed to hold its first quarter lease sale, PAW decided to throw its weight behind the challenge.

“We believe the administration’s decisions are going to have real impact on the state of Wyoming,” Ryan McConnaughey, communications director at PAW, told The Center Square. “The administration likes to talk about this idea that the executive order is harmless yet we already saw that this most recent lease sale was canceled, which we expect based on averages over the last six years cost Wyoming schools about $4 million.”

PAW President Pete Obermueller said in a news release that $4 million is enough money to fund an entire year of education for 220 Wyoming children, calling the “harmless” narrative “false.”

WEA President Kathleen Sgamma said she was happy to be joined by PAW.

“We filed in Wyoming because it has the largest amount of federal acreage under lease, and now we have the home team assembled,” Sgamma said in the release. “Because of the interlocking land ownership in Wyoming, it’s nearly impossible to develop oil and natural gas in the state without touching some federal lands or minerals.”

Filed against the Department of Interior, the lawsuit holds that the BLM is in violation of the Mineral Leasing Act, which states that lease sales must be held “for each State where eligible lands are available at least quarterly,” as stated in the news release.

“There were 426 parcels up for nomination for the March lease sale this year, and they did not hold that lease, and so that is the main grounds,” McConnaughey said.

The state of Wyoming garners about $79 million from lease sales annually, according to the release. Estimates by PAW put losses from the lack of a sale this quarter at $9.5 million.

“The decree might make sense to someone sitting in Washington, D.C., but makes no sense in Wyoming and across the West,” Sgamma said.

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How A Biden Presidency Could Impact Wyoming Energy

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By Ryan Lewallen, County 17

President-elect Joe Biden made some big promises that, if kept, could prove disastrous for the Wyoming energy economy, but it’s not likely to happen given the outcome of the election, one energy economist says.

In little more than a week, sitting U.S. President Donald Trump will hand over the reins to Biden, who has publicly committed to take steps to reduce the nation’s carbon emissions starting on day one.

By the end of first day in the White House, the soon-to-be president has promised executive action that will ban oil and gas leasing on federal lands in addition to implementing “aggressive methane pollution limits for existing oil and gas operations,” according to Biden’s energy plan.

But it’s unlikely that those bans and restrictions will be a permanent energy development moving forward, according to Robert Godby, energy economist and acting associate dean at University of Wyoming’s Haub School of Environment and Natural Resources.

The Democratic Party now has control of both the legislative branch and the White House, but the newly won Democratic majority in the U.S. Senate is razor thin, Godby said, which means any dissenting opinion could derail such radical energy-related actions on the Senate floor.

“Within that, it means that moderates will most likely prevail despite what people consider,” Godby said.

He noted it is important to remember that one of the most prominent Democratic Senators, Joe Manchin of West Virginia, comes from a state second only to Wyoming in coal production.

It is only speculation at this point, but it is logical to believe that Manchin will do what he can to protect coal within his state, Godby said, which is good news for pro-Wyoming coal efforts by Republican Senators John Barrasso and Cynthia Lummis.

Godby also believes, that given the outcome of the recent election, the Democratic Party will not do anything to endanger their precarious margins in the body.

It is Godby’s contention that Democrats will instead work hard to avoid taking on drastic climate legislation which may result in backlash from their constituents in states reliant upon fossil fuel production. Past discussions of major climate legislation are believed to have contributed to Democrats losing control of the Senate in 2014.

Additionally, Biden is generally considered more of a moderate and made it known during the presidential debates that he is not anti-fracking, despite his contrary stance during the primaries. Biden has worked hard to thread the needle by calling for ending oil and gas leasing upon public lands while also not calling directly to outlaw fracking, a decision which could have cost him votes in eastern states which have benefitted greatly from America’s newly accessible and abundant supplies of natural gas.

The decline in the coal industry can be partly attributed to cheaper energy production available through natural gas, Godby said, which in turn is now being pushed out by even cheaper renewable energy options, both of which are cheaper to build than utility-scale coal fired power plants.

More important for utilities, the operating costs associated with renewables, irrespective of depreciation and long-term maintenance, are significantly lower than those for coal or natural gas. There is a cost that can be attributed to each ton of coal burned or each MCF of natural gas used and those specific costs are how utilities decide, based upon demand at any one time, whether to run the wind turbine, gas turbine, or coal plant within their portfolio.

Climate change concerns are gaining momentum as well, according to a 2019 poll conducted by Pew Research, with most Americans wanting their government to do more to reverse the effects of climate change and 72% of those polled urged prioritizing the development of alternative energy options over expanding fossil fuels.

Similar trends have been seen in Wyoming with 61% of residents participating in a 2016 study from Yale University acknowledging that global warming is real.

“Most people recognize that climate change is an issue, that it’s human caused, and we need to do something about it,” Godby said, adding that some are beginning to understand that, in order to address climate change, the current concentrated use of fossil fuels can’t continue.

Coal markets are changing, too. There are too many coal mines chasing too few customers, according to Godby.

In the short term, coal could be looking at a brief resurgence as a result of the COVID-19 pandemic’s effect on the oil and gas industry, which has served to bolster coal’s ability to compete with natural gas, Godby said.

This resurgence could increase coal production as high as 235 million tons in 2021, according to Godby, but it will only be a temporary situation.

As the nation moves out from underneath the COVID-19 umbrella, oil production is expected to pick back up and drive natural gas prices down, once again placing strain on an already strained coal market.

“I don’t think any president, any administration, or any change in Congress can really do much to stop the market momentum and the international recognition that energy technology has changed,” Godby said.

It might not happen in the next two years or even in the next decade, but coal markets are changing to the negative, he added.

Oil and Gas

Natural gas could be facing issues moving forward with the incoming administration, but they might not be as severe as some have argued, Godby said.

It’s not likely that permanent drilling and leasing bans on federal lands will occur given the political climate, but the industry could still see some negative impacts if emission rollbacks instituted by Trump are reinstated.

“And those can be done without Congress through executive order and through agency orders,” Godby said, which could make it more difficult for natural gas to compete with other fuels like coal.

If any bans were implemented, Godby predicts they would most likely happen in places where oil and gas drilling is not likely to upset the thin Democratic majority in the Senate.

“There’s too much at stake for the Democrats to lose and not enough to gain there,” Godby said.

But a transitioning energy market, especially considering the COVID-19 pandemic and growing climate concerns, means oil could very well follow the trends in coal.

The pandemic has shown us one thing: that the nation can conduct its business without as much travel, which means fundamental structural changes in the transportation sector could reduce the demand for oil, according to Godby.

“That means that the outlook for oil long-term, and I mean a decade-plus, is also likely negative,” he said, adding that the sooner Wyoming starts recognizing these realities and adapting to them, the better.

Gillette

Gillette and Campbell County are in for a challenge regardless of who sits in the White House, a fact evidenced by the last four years and favorable coal conditions, Godby noted, but that doesn’t mean the end of the road.

“I’ve always been optimistic about Gillette,” Godby said, adding that Gillette is a dynamic place being the third largest population center in the state with airport access and higher education opportunities.

The decision to avoid going anti-fracking sparked concerns within Biden’s own party and raises the possibility that we may see an attempt from more progressive voices in the party to resume a more anti-energy stance, according to Godby.

Places like Gillette have the human capital, the knowledge, and the willingness to find new uses for coal, he said.

Campbell County Commissioner Del Shelstad advised that efforts to find new uses for coal outside of thermal energy are already underway at places like the Wyoming Integrated Test Center (ITC) and the Advanced Carbon Products Innovation Center.

“We’ve never seen coal in the state that it is now. I don’t know that coal will ever come back like it was, but we’d like to think there’s a sustainable future for coal somewhere,” Shelstad said.

He added that he would like to see the commercialization of new coal technologies that would result in boots on the ground and jobs created.

Godby agreed, saying that the economic opportunities are becoming more readily apparent as Wyoming residents come to grips to the fact that coal could be on its way out the door.

“Long-term, I think Gillette has a bright future. Whether it will be the energy capital of the nation, that remains to be seen,” he said. “Things change that way, but that doesn’t mean the long-term success of Gillette is predetermined.”

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Gordon: Wyoming Will Fight Feds To Save Energy Industry

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If Wyoming’s energy industry is going to go down, it’s not going down without a fight, Gov. Mark Gordon said Tuesday.

In his “Address to the Legislature” on Tuesday, the Republican sounded concern over the future of Wyoming’s energy sector due to a seismic shift in national politics.

With the U.S. House, Senate, and executive branch all under Democratic control, those in the fossil fuel industry have been bracing for a hostile climate. But Gordon said the state will pursue every legal option to stand its ground and protect the industry to the best of its ability.

“There is good reason to be concerned that the actions of the next administration will further dampen the economic outlooks for energy and mining here in Wyoming,” Gordon said.

“The signals being sent during the transition period indicate that the substantial progress to reduce obstructionist, counter-productive regulation could be in peril,” he said.

Gordon said he hoped the incoming administration would value energy independence and realize that domestic production of energy is “central to our nation’s security.”

Although he praised the influence of Wyoming’s outsized delegation — leadership roles in both the House and the Senate — Gordon said he was ready for a fight to protect Wyoming’s interests.

“We will always defend our state and protect her interests through every legal, political, business, and technology option available to us,” he said.

It’s not a battle about a specific sector in the industry, he said. Instead,he described it as an issue of state’s rights, noting that Wyoming teamed up with Montana to sue the state of Washington for blocking Wyoming access to ports to export coal.

“We simply cannot have one state interfere with another’s access to markets by using the Clean Water Act as a weapon to pursue a misguided political agenda,” he said.

Gordon, a proponent of both fossil fuels and renewable energy, emphasized that both kinds of energy have a place in Wyoming’s future.

“Wyoming has responsibly led the way for a new energy horizon. One which values all sources of energy from nuclear, oil, gas, and coal to renewables like wind and solar,” he said.

In the end, however, Gordon said defending Wyoming’s energy interests are a top priority to protect the state’s future.

“We cannot and will not let the misguided actions of special interests and federal agencies rob our future,” he said.

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Campbell County Man Believes In Second Life For Powder River Basin Coal Ash

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By Jennifer Kocher, County 17

Good news is hard to come by today with regard to Wyoming’s lagging energy industry, particularly in the Powder River Basin, but at least one man is optimistic about the county’s future.

Where there’s a bust, Phil Christopherson believes, there’s a boom to follow, which may come as early as 2022.

His glass half-full mentality stems in part from his work as CEO of Energy Capital Economic Development (ECED), where the crux of his job is to attract new businesses to Campbell County, and ignite and revive local industries.

He looks to the long-term with regard to driving economic diversity to keep the economy robust, regardless of downturns in energy.

Generally speaking, he noted, the county has a lot going for it. Lots of space, for one, as well as easy access to Interstate 90, rail and commercial jet transportation, business-friendly regulations and taxes as well as top-notch recreation and business incubator facilities.

He sees several promising opportunities on the horizon, including a pretty hefty investment on behalf of the U.S. Department of Energy (DOE), the University of Wyoming’s School of Energy Resources (SER), ECED as well as funding from both city and county governments among other developments currently in the works.

Moreover, as a Wyoming native, Christopherson wholeheartedly believes in the tenacity, grit and resourcefulness of its people, particularly those in Campbell County.

He points to its long history as the nation’s leading energy provider and reveres it as home to several world-class companies like Liebherr, Cyclone Drilling and L&H Industrial. Yes, times are a little hard, he admitted, but there are equally lucrative days to follow.

The future site of Atlas Carbon near the new Highway 59 buildout (left).
The future site of WyIC, near HWY 59 buildout.

Sitting at a table in his corner office of the Energy Capital Building in south Gillette last Tuesday, Christopherson slid a press release across the laminated surface, detailing news about a new pilot-scale production facility currently in the design phase at Energy Capital Economic Development’s Wyoming Innovation Center (WyIC).

It’s scheduled to open next year as part of the exploratory project, where scientists will attempt to extract rare earth elements from coal ash.

The $1.62 million project is funded through a partnership between the city, county, university and federal agencies including a federal grant from the Department of Energy (DOE) Technology Commercialization Fund earmarked for helping to develop promising energy technologies.

The three-year project entails a partnership between the National Energy Technology Laboratory (NETL) in conjunction with UW’s SER and will entail identifying and extracting rare earth elements and other critical metals from feedstocks in the PRB to test efficacies and economic value.

Currently, Christopherson’s ECED team is in the process of finalizing the designs for the facility, which they hope to have nailed down in August or early September.

“This project is an important step forward in diversifying and expanding Wyoming’s economy through value-added coal projects,” he said.

The project has already garnered the sign-off from Gillette Mayor Louise Carter-King, who touted both the partnership as well as the potential for the project.

“We always knew that this was the perfect site, and it is gratifying to know that others recognize the potential of the Powder River Basin to assist our nation,” Carter-King said in an ECED release announcing the project.

Quoting studies that have shown the PRB coal has had high extractable REE content compared to other coal ash sources in other parts of the country, Christopherson also touted the high volume of available coal ash stocks with up to 270 to 690 tons produced by a single power station per day.

“This project is an important step forward in diversifying and expanding Wyoming’s economy through value-added coal projects,” he said. “We are proud to host the NETL rare earth elements project at our WyIC facility.”

Securing energy independence

Rare earth elements (REEs) are a part of a group of 17 metal elements that occur naturally and are typically found in varying proportions in the same ore deposits, according to the Wyoming State Geological Survey (WSGS), and are used in a variety of products from nuclear reactors, cell phones, magnets and camera lenses among several other products. They’re also key to renewable technologies such as wind turbines and electric cars.

For the past two decades, China has dominated the REEs market, accounting for about 95 – 97% of the world’s supply.

Currently, the United States is wholly dependent on imports for 21 of these critical materials, according to the U.S. Geological Survey (USGS), and 50% dependent on imports for an additional 28 more.

In recent days, as the Trump Administration ratchets up tensions with China surrounding trade and national security issues, including closing down the Chinese Embassy in Houston over accusations that the communist nation is pirating U.S. intellectual property and stealing research and industry secrets, many in government like Wyoming Senators John Barrasso and Mike Enzi see the country’s critical minerals dependency as a matter of national security as well as an opportunity to revive the fledgling coal sector.

In May, both senators sent letters to the secretaries of defense and the interior asking for them to invest in national efforts to build our own REE stockpile. Last week, Sen. Barrasso further sent a letter to the DOE, urging the agency to set up a satellite office in Wyoming to build on efforts to bolster statewide energy research, development and commercialization.

Given the country’s and world’s reliance on these REEs, demand for them only continues to rise. The global rare earth market is estimated to grow in value from $8.1 billion in 2018 to more than $14.4 billion by 2025, according to Zion Market Research, a company specializing in cutting-edge informative reports.

“Right now,” Christopherson said, “we’re relying on China for our Rare Earth Elements. This project is an important step forward in the United States developing our own sources of REE, while diversifying and expanding Wyoming’s economy through value-added coal projects.”

Many in the county and state are interested in tapping into PRB coal ash as the next panacea.

Regaining ground

At one point, the United States was a leader in REEs. Between the 1960s and 80s, the country had the largest market share, mostly mined at Molycorp’s Mountain Pass Mine in California, according to a 2017 DOE report. The open-pit REE mine of the Mojave declared bankruptcy in 2015. In Wyoming, Bear Lodge outside of Upton, had held promise in past years but fell flat under poor market conditions and also closed in 2015.

Meanwhile, China, which has the world’s largest known REE deposit, the Bayan Obo deposit, continues to dominate the market after beginning REE production in the 1980s, per the report.

Currently, the DOE is hoping to find new pockets of minerals with its sights set on two predominant coal-producing areas of the country – the West and Appalachia – where DOE and NETL assessments estimate a potential REE reserve of 6 million metric tons (MT) of potentially recoverable minerals from coal and coal byproducts in Montana, Wyoming, Colorado, Utah, New Mexico and Arizona with another estimated 4.9 MT from four eastern states, including Pennsylvania, West Virginia, Kentucky and Virginia.

In Campbell County, the three-year joint project between NETL and UW’s SER will focus on extracting REEs from coal ash from nearby utility companies.

Scott Quillinan, director of research at the UW’s SER, is also optimistic about the potential of the DOE/NETL project in the PRB.

PRB coal collected from the University of Wyoming coring program for REE analysis.
PRB coal collected from the University of Wyoming coring program for REE analysis. (H/t UW SER)

The first year-and-a-half will consist of onsite lab work between researchers at UW and NETL, who will collaborate from their Pittsburgh lab to fine tune extraction technologies. Once the WyIC facility is up and running, Quillinan said, the entities will join forces in-house for the remaining 18 months.

In terms of REEs, researchers at SER are particularly excited about the high concentrations of two critical, middle and heavy elements, Dysposium and Neodymium, in the PRB’s sub-bituminous coal.

“Neodymium in particular is a very important element,” Davin Bagdonas, research scientist at SER’s Center for Economic Geology Research and SER’s principal investigator on the REE pilot project, said.

“PRB coal/fly ash is a great potential resource for it in high volume,” he said.

The light REE, Neodymium, is used to make hard drives in laptop computers, headphones and hybrid engines among other uses. Dysposium, which is a heavy rare earth, is used primarily to make permanent magnets and hybrid engines.

The area also has high concentrations of Praseodymium, a critical mineral used for magnets and hybrid engines, Bagdonas added, as well as Cesium, a soft, silvery, extremely reactive metal.

Though the PRB is rich in these elements, Quillinan noted, the tricky part is extracting them both safely and economically, which entails digesting the coal with acid to differentiate the elements from the coal ash.

A second snag is that currently further processing of the minerals once extracted generally occurs overseas. This is also true of manufacturing. Most of the products that require rare earth elements in the process are made elsewhere, he said.

Regardless, Quillinan remains optimistic about the quality of the feedstocks as well as the technology, which if proved economically viable, may spur private investment into building an extraction and processing facility in Wyoming or elsewhere where the US might regain its prominent spot as the leader of REEs.

“It looks promising,” he said, noting the volume of available coal ash at the ready as well as the high calcium content, which makes coal ash more easily to digest with acid.

That said, the project is for naught if it’s not economically feasible. The techno-economics will be evaluated per DOE-approved economic models as part of the project.

“We know we have high-potential feedstocks and promising technology and know the demand is there,” Quillinan said, “but we have to figure out if it makes sense economically. If it doesn’t pencil, private investment will never come.”

However, he noted, if the United States continues to trend toward renewable energy sources, these rare earth minerals are imperative, and he’d like to see Wyoming take the lead.

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