Friday, August 24, 2012
Obama’s war on coal can be stopped, not reversed, says CEO of coal company
By: Neil W. McCabe
8/24/2012 06:15 AM
The founder and CEO of the nation’s 12th largest coal producer told Human Events in an exclusive interview that President Barack Obama’s war on coal has done permanent damage to America’s competitiveness.
“It can be stopped, but it cannot be reversed,” said Robert E. Murray, the CEO of Murray Energy, a privately-held coal producer based in Pepper Pike, Ohio.
Obama is planning to close 175 power plants by 2020, roughly equivalent to 83,000 megawatts, he said. Most of the plants will go off the grid by 2014.
The physical reality is that idle coal mines or coal-fired electric generating plants atrophy, he said.
“Those plants are not designed to remain idle,” he said. “The boilers and turbines are made to keep heat in them and they start deteriorating very rapidly.”
The same is also true for coal mines, he said.
“A coal mine is a living thing,” Murray said. “Once you stop the operation of a coal mine, they flood very quickly, and secondly, the roof conditions, even if you can keep it pumped out, slake.”
“The roof slakes, the roof spalls — these are mining terms,” he said. “As the moisture in the air goes underground from the hot air outside into the 58 degrees underground, the air currents just cut the roof down like a knife. The mine was a living thing. When it dies, you cannot bring it back.”
Romney understands that there is a whole segment of the American economy, and the American scheme of things, that is being destroyed, Murray said.
“I’ve been with Romney a number of times, and some of that was one-on-one,” he said. “I can’t betray a confidence, and never would, but I can tell you, he gets it.”
Murray said after working 31 years at a NYSE-traded coal company, he led a leveraged buyout of one of the company’s mines in 1988. Today, Murray Energy is the 12th largest producer of coal with 3,300 employees.
“My sons are fifth-generation coal miners and we were coal miners in Scotland and Wales before that,” he said.
“What has happened in the last three years is unprecedented in the history of the coal industry,” he said.
“Barack Obama and his appointees and his political supporters are destroying the United States’ coal industry deliberately,” Murray said.
When he was running for president, Obama vowed to bankrupt any new coal-fired plant with regulations, he said.
“While Joe Biden said he wanted ‘No coal in America,’” he said.
“They are making good to their promises to their radical constituencies on the Left Coast and California and in New England and elsewhere,” said the coal executive, who is a graduate from an advanced management program at the Harvard Business School and holds a bachelor’s in mine engineering from the Ohio State University, Columbus, Ohio.
“Coal-fired electrical generation has historically been $0.04 per kilowatt hour,” he said. “Wind and solar power that Obama promotes is $.22 per kilowatt hour.”
“People who manufacture a product for the global market are not going to be able to compete,” he said.
Electricity from coal is cheap and reliable, he said.
“In 2011, there was major flooding in Ohio, and the power was not available, and the utility commission required American Electric Power, the country’s largest coal-fired producer of electricity, to stay connected to 3,800 megawatts of wind power on their system,” he said.
“When the floods were on, and they needed the power, he drew on his wind power and he had 18 megawatts — ‘cause the wind wasn’t blowing,” he said.
“We can not for economic reasons, for security reasons, continue this insanity,” he said.
“It is insanity to set forth on this future for a staple we need,” he said.
“China has been building a 500-megawatt coal-fired plant every week, for years,” he said.
“What’ll be happening is that they are going to have the low-cost electricity generation and it’s going to make the United States of America even less competitive in the global marketplace, because China will have the low-cost electricity,” he said. “We will end up exporting more jobs to China.”
At the last quarterly auction of a group of electric power companies from 13 Mid-Atlantic and Midwest states the prices for 2015 and 2016 were bid up to a price eight times what the power price was in 2011 and 2012, he said.
After the auction, utilities put out statements explaining why they bid the prices up so high, Murray said.
“There are going to be brownouts and blackouts because of the shortage of power and because they are required by the utility commissions to keep the lights on, the heat on, so they bid it up because Obama is closing all of these coal-fired $.04-a-kilowatt power plants,” he said.
There is also a human dimension to the coal business, because so many families depend on the jobs provided by coal, he said.
At one event in Wheeling, W.Va., organized by Murray, presumptive Republican presidential candidate Mitt Romney spent an evening with 800 of his workers and their families, he said. “Afterwards, Romney looked out at the people there and said to me privately: ‘I’ll remember this night forever.’”
Murray, who as a young miner was once trapped in a dark mine for 12 hours, said he has one unionized mine, the first one he bought.
“I have dealt with the unions all my life and I understand them very well.”
Murray said union members through the years have threatened him and his family with harm. “My life has been threatened by them repeatedly during the 55 years that I have been active in the coal industry.”
“I say to my union employees: ‘Why do you let the United Mine Workers take $2,500 a year in dues from you and put it on a guy that is eliminating your job?’” he said. “They just hang their heads.”
“I know these men, they get intimidated by the United Mine Workers and they are afraid to vote them out,” he said.
It is more than just his workers’ jobs that are at risk, he said.
Studies of the economic impact of the coal industry show that because of its place in the food chain, it has a tremendous multiplier effect, he said.
“It’s up to 11 to 1, and that’s to provide the goods and services to our people that our mines require, so with that multiplier, our company accounts for some 40,000 jobs,” he said.
“If these people, who I know by name, lose their homes, they have no one to sell them too.”
“What happens is that these people that I know by name, who just want to work in honor and dignity, are denied that right,” he said.
“These people then go from the positive to the negative side of the ledger, permanently for the rest of their lives — and this is not the America I cherish,” he said.
“I grew up very poor,” he said. “My dad was paralyzed in a mining accident when I was nine-years-old, I supported my mother and my dad from the time I was 16.”
“Obama is eliminating jobs by the tens of thousands in areas where there is nothing else for these people to do,” Murray said.
“You give a 52-year-old man, who’s never had a decent job after working for 30 years, you give that man a job and he just starts bawling in your office,” he said.
“Obama has never had a job, he’s never created a job, he’s never seen that,” he said. “I see it every day.”
Murray said the president and federal regulators target his company.
“I can’t get permits that other coal companies get,” he said. “I get scrutiny from the U. S. Environmental Protection Agency, the Department of Labor, Mine and Safety Administration and the Department of the Interior’s office of coal mining that other companies don’t get.”
“I have a target on my back,” he said. I’ve been doing this for 55 years and it’s unbelievable that it is happening in the United States of America,” he said.
“When Obama and his appointees push on Bob Murray, I push back harder — but, I get frightened,” he said. “I am frightened at the moment because of what they do.”
But, he will continue to push back, he said.
“Why? Because, I know the names of those thirty-three hundred people, “Murray said. “Everything that they have is going to be destroyed.”
To read another article by Neil McCabe, click here.
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Posted by Brett at 5:49 PM