(The following story by Nick Schneider appeared on the Greene County Daily World website on October 15.)
GREENE COUNTY, Ind. — Indiana Rail Road Company plans to build a five-mile spur rail line south of Dugger to serve a proposed new Peabody Energy Corp. surface coal mine.
Indiana Rail Road Company, based in Indianapolis, petitioned the federal Surface Transportation Board on Oct. 7 for an order declaring the new track a spur exempt from board approval and not construction of a line or railroad requiring board approval.
Indiana Rail Road spokesman Chris Rund told the Greene County Daily World on Wednesday that the new Bear Run pit mine will be located south of Dugger — south of the rail’s east-west main line.
“The extension would connect with our main track near Dugger (just east of town). There have been a number of rail lines owned by both mining companies and railroads that have served coal mines in this area for many years. Tracks have been rebuilt, abandoned and/or relocated through the years as mining activity relocated and changed,” Rund said. “The extension will cross Hwy. 159 and then run parallel to the road. Length of the extension is approximately 5.2 miles.”
According to the petition, Peabody subsidiary Black Beauty Coal Co. LLC’s Farmersburg mine in Vigo County is running out of minable reserves.
Plans call for the first coal trains to move over the new line in July 2009, which coincides with the planned start-up date for the new mine, the railroad’s petition stated.
Peabody spokesperson Beth Sutton told the Greene County Daily World this week that she could not confirm nor deny that there is new southern Indiana coal venture in the works because a formal announcement of the plans had not been finalized.
She did say that Black Beauty Coal is in the permitting process for a new mine operation in the Sullivan-Greene County area.
Indiana Rail Road was asked to build a spur to connect the new load-out to its east-west line. The new mine is near the old mine south of Dugger, and the proposed spur will use a half-mile of the former right of way that served Dugger. According to the petition, Peabody owns or controls 3.26 miles of the proposed right of way, and INRD expects Peabody to acquire an additional mile.
Indiana Rail Road Company estimated the cost of the spur at between $9 million and $12 million. It did not say who owns the remaining property.
INRR anticipates that either Peabody or Peabody’s customers will enter into rail transportation contracts that will make it possible to finance the project.
In the event the Bear Run spur track is not built, or is delayed beyond the July 1, 2009 planned start-up date of the Bear Run pit operation, Peabody will move the coal by truck to the present Farmersburg mine preparation plant and rail load-out. The distance of this truck haul is approximately 34 miles.
The coal from Bear Run will be the only traffic on the new rail spur. Trains from the mine can go east to Indianapolis and the connection with Indiana Southern Railroad or west to Hoosier Energy Rural Electric Co-op Inc.’s Merom station and Ameren Corp.’s Newton station.
Rund said his firm is optimistic about the rail line spur and has the view that an expanding local coal mine operation is good news for the Indiana economy.
“Coal as always been a part of Greene County and it is encouraging to see this. There is a lot of energy laying below the ground there,” he said. “Coal is one of our mainstay commodities (with the railroad company).”
Black Beauty’s Farmersburg Mine, in Vigo and Sullivan counties, shipped 3.5 million tons of medium sulfur coal in 2007 to Indianapolis Power & Light’s Stout Station and to Cinergy/PSI’s Wabash River Station.
Opened in 1996, the mine has steadily increased coal production and employment. Its 260 employees currently operate the mine on two shifts per day, seven days a week, year round. They use a combination of dragline, truck/shovel and tractor push to remove overburden and uncover coal in the Indiana No. 7 and No. 6 seams. The coal is hauled from the pit by truck to the preparation plant for crushing, processing and blending before being transported by train to the utilities.
Farmersburg Mine is operated by Black Beauty Coal, the largest coal producer in the Illinois Basin. Black Beauty is a subsidiary of St. Louis-based Peabody Energy, the world’s largest private-sector coal company, with 2007 sales of 238 million tons and $4.6 billion in revenues. Its coal products fuel approximately 10 percent of all U.S. electricity and more than 2 percent of worldwide electricity.