Thursday, August 27, 2015

Geologic sequestration of CO2 may be coming for Four Corners power plant

Our sources say that Arizona Public Service (APS), owner of 3 of the generating units at the Four Corners coal-fired power plant in northwest New Mexico [right, credit SRP], will invest $800 million to $1 billion to capture the carbon dioxide from the plants smokestacks for two of the units, and bury it permanently in deep geologic units (sequestration).

APS reportedly briefly community leaders in advance of making a public announcement.

The geologic sequestration option would allow the plant to continue to burn coal to generate electricity.    Coal for the plant comes from the Navajo coal field near Farmington, which was purchased by the Navajo Nation last year.   The power plant also sits on Navajo lands, and together they are major revenue sources for the Tribe. 

If confirmed, this will be one only a handful of full scale operations of geologic sequestration anywhere in the world.  It could have implications for other coal-fired plants in the region. [Right, model for geologic sequestration. Credit, Plains CO2 Reduction Partnership]


Last month the US Dept. of Interior issued a record of decision that extends the lease on the plant by 25 years and allows for the expansion of the Navajo coal mine.  The operators also agreed to fund $160 million on equipment to reduce emissions.   Officials say continued operation of the plant and coal field will provide $40 million to $60 million per year in direct economic benefits to the Navajo Nation.

Three other, less efficient units of the Four Corners plant are planned for closure.

Freeport to cut US mine staff 10%, production by 25% in response to price drop

Freeport McMoRan Copper & Gold, the Phoenix-based company with worldwide operations including 7 copper mines in Arizona, announced plans to cut the number of U.S. mine workers by 10% along with a 25% reduction in copper production, and a big reduction in capital expenditures.  This is in response to copper prices dropping to the lowest levels in more than 5 years.   [My reading is that the economic downturn in China is a major factor in the falling price of copper and other commodities. China probably consumed 45% of the world supply of copper.]

Meanwhile, Carl Icahn announced he acquired an 8.5% stake in Freeport, prompting a surge in the stock price which had dropped from $38 last year under $10 recently.   Icahn said he plant to review "executive compensation practices and capital structure as well as curtailment of the issuer's high-cost production operations."

Freeport's news release summarized the key points:
5% reduction ($700 million) in estimated 2016 Mining capital expenditures
  • Projected consolidated 2016 capital expenditures for Mining and Oil & Gas estimated at $4.0 billion
    • 29% reduction from July 2015 estimates.
  • Reduction in copper sales of 150 million pounds per year in 2016e and 2017e
  • 20% reduction in estimated 2016 unit site production and delivery costs compared with 2015e
  • Actions enhance outlook for Free Cash Flow generation at low prices
  • - See more at: http://investors.fcx.com/investor-center/news-releases/news-release-details/2015/Freeport-McMoRan-Announces-Further-Spending-Cuts-in-Response-to-Market-Conditions/default.aspx#sthash.j5lzS31C.dpuf
    • 25% reduction ($700 million) in estimated 2016 Mining capital expenditures
    • Projected consolidated 2016 capital expenditures for Mining and Oil & Gas estimated at $4.0 billion
    • 29% reduction from July 2015 estimates.
    • Reduction in copper sales of 150 million pounds per year in 2016e and 2017e
    • 20% reduction in estimated 2016 unit site production and delivery costs compared with 2015e
    • Actions enhance outlook for Free Cash Flow generation at low prices
    For its North American mines, Freeport reported:

    FCX operates seven open-pit copper mines in North America - Morenci, Bagdad, Safford, Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. The North America copper mining operations have substantial production capacity, flexible operating structures and long-lived reserves and resources with significant additional development potential.

    FCX’s revised plans in North America incorporate reductions in mining rates to reduce operating and capital costs, including the suspension of mining operations at its Miami mine (which produced 57 million pounds in 2014), a 50% reduction in mining rates at the Tyrone mine (which produced 94 million pounds in 2014) and adjustments to mining rates at other U.S. mines. The revised plans at each of the operations incorporate the impacts of lower energy, acid and other consumables, reduced labor costs and a significant reduction in capital spending plans. These plans will continue to be reviewed and additional adjustments may be made as market conditions warrant.

    These changes are expected to result in an approximate 10 percent reduction in employees and contractors at U.S. mining operations

    North America Copper Mines. FCX operates seven open-pit copper mines in North America - Morenci, Bagdad, Safford, Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. The North America copper mining operations have substantial production capacity, flexible operating structures and long-lived reserves and resources with significant additional development potential.
    FCX’s revised plans in North America incorporate reductions in mining rates to reduce operating and capital costs, including the suspension of mining operations at its Miami mine (which produced 57 million pounds in 2014), a 50% reduction in mining rates at the Tyrone mine (which produced 94 million pounds in 2014) and adjustments to mining rates at other U.S. mines. The revised plans at each of the operations incorporate the impacts of lower energy, acid and other consumables, reduced labor costs and a significant reduction in capital spending plans. These plans will continue to be reviewed and additional adjustments may be made as market conditions warrant.
    These changes are expected to result in an approximate 10 percent reduction in employees and contractors at U.S. mining operations
    - See more at: http://investors.fcx.com/investor-center/news-releases/news-release-details/2015/Freeport-McMoRan-Announces-Further-Spending-Cuts-in-Response-to-Market-Conditions/default.aspx#sthash.j5lzS31C.dpuf

    Wednesday, August 26, 2015

    EPA: Gold King Mine blowout "inevitable"




    The EPA internal investigator team reports that "the Team believes that Emergency Action Plan (EAP) included with the site plan did not anticipate or plan for the volume or pressure encountered and contained only limited emergency procedures in case of a mine blowout."    Yet, even with that, "the Team concludes that the Adit blowout was likely inevitable."   [Right, Gold King Mine Level 7 and Red & Bonita adits.  EPA  on GoogleEarth image, June 2015]

    Much credence is given to the claim that EPA received no significant criticism of its plans.


    Meanwhile, here are some of the news stories circulating about the spill, its impacts, and consequences:



    ***Gold King Mine Spill Has Not Adversely Affected Our Waters

    ***Page Economy Feels Impact of Gold King Mine Spill


    Local governments, nonprofits urge mining regulation reforms


    Environmental groups, county petition federal agencies to change mining regulations

    Federal rules wouldn’t have saved the Animas River from Gold King anyway


    Groups to feds: Tighten mining rules in light of river spill

    Disastrous Animas River Mine Spill Prompts Call for Regulatory Reform

    Groups to feds: Tighten mining rules in light of Animas River spill

    Navajo set example, protect land for future generations


    Tuesday, August 25, 2015

    Celebration of lives and professional accomplishments of Bill and Jackie Dickinson
























    The University of Arizona Department of Geosciences invites you to a celebration of the lives and professional accomplishments of Bill and Jackie Dickinson, to be held Friday, October 23 from 
    3 – 6:30 pm in the Kuiper Space Sciences building on the University of Arizona campus.

    Please feel free to share this announcement. 

    The Geosciences Department continues to welcome your thoughts, photos, and memories for the Bill Dickinson remembrance page on the Geosciences web site: http://www.geo.arizona.edu/Dickinson. Please email your tributes to alicias@email.arizona.edu.