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Coal Production Drops to Levels Not Seen Since 1980s Adapted from Information by the U.S. Energy Information Administration According to recent U.S. Energy Information Administration data, coal production in the first three months of 2016 was 173 million short tons (MMst), the lowest quarterly level in the country since a major coal strike in the second quarter of 1981. Production from the Powder River Basin (PRB) in Montana and Wyoming declined the most in tonnage and percentage. Market conditions for coal produc- tion have been very poor due to increas- ing environmental regulations and the country’s shift to renewable energy pro- duction. Although electricity generation accounts for more than 90% of domestic coal use, the recent natural gas boon has made natural gas-fired electricity generation more affordable, causing more competition for the industry. The 17% decrease in coal produc- tion from the previous quarter marked the largest quarter-over-quarter down- turn since the fourth quarter of 1984. Another factor for decreased production was the unusually warm winter of 2015-16, which caused power plants to stockpile 34 MMst of unused coal, the highest fourth-quarter net increase on record. This ultimately resulted in lower coal orders for the first quarter of 2016, while plants merely consumed coal from their stockpiles. Information from the American Association of Railroads reinforced the data by indicating coal carloads in the first three months of 2016 were about 20% lower than in the final three months of 2015. Production from PRB witnessed the largest decrease with production of 69 MMst, which was its lowest level since the second quarter of 1995. Coal demand has decreased across the nation. States such as Texas, Michigan, Illinois, and Oklahoma, accounted for an average quarterly demand of 37 MMst of PRB coal in 2015, which fell to 19 MMst in the first quarter of 2016. *- (*-! %)"*-( /%*) 1%.%/ 222 (22 *-# %))!.*/ /!- !'' ..* % /%*) /$ ))0 ' - ! $*2 *)1!)/%*) )0 -4 %))! +*'%. --%*// *-/$2!./ -**&'4) -& $! 0'! 0) 4 3$% %/*- !/ 0+ * - *" %-! /*-. !!/%)# ) *.+%/ '%/4 *) 4 ' ..!. ) ''$%)!4 ! /0-! - ! $*2 %!. -*#- ( 2 - . ),0!/ ) .%)* %#$/ 0!. 4 +! &!-. ) ' ..!. ))0 ' !!/%)# ./ -!.% !)/. !!/%)# %) ' * - !!/%)# ) '0( %)# ' .. / ! )!. 4 '0( %)# ' .. / 50 JANUARY 2017 WorldWide Drilling Resource ®