By Nancy Lofholm
Denver Post Staff Writer
Grand Junction – A Kentucky- based coal company announced plans Tuesday to seek approval for a rail spur as part of a $160 million plan that will give Mesa and Garfield counties one more energy-development boost and add 5.5 million tons to Colorado coal production.
Wexford Capital LLC, a company doing business in Colorado as Central Appalachia Mining, has been operating the state’s smallest coal mine, at the edge of the Bookcliff Mountains northwest of Grand Junction, for several years.
The mine, which straddles Mesa and Garfield counties, had been little noticed in an area where oil and gas, oil shale and uranium have been booming or making visible comebacks.
Terry Coleman, chairman and chief executive of Central Appalachia, said a rail spur will make further mining of the high-quality coal in that area possible It had been hampered by the necessity of hauling coal out in grain trucks.
“The key to everything is building the rail spur,” Coleman told a large gathering of local power brokers in Grand Junction on Tuesday.
The company has filed plans with the Bureau of Land Management to begin an anticipated two-year process to win environmental approval for the 15.5-mile-long rail spur that will connect to Union Pacific tracks in Mack. The spur curves around the west of Highline Lake and ends at the edge of the Bookcliffs. Nine miles of the railroad are planned to be on BLM land and the remainder would cut across private property.
Coleman said the project will include a new processing facility, loading dock and the latest in long-wall technology for the mine that will be moved 4 miles south of its current location.
The mine has been producing about 300,000 tons of coal per year for the Cameo Power Plant in DeBeque Canyon east of Grand Junction.
When the production is increased, Central Appalachia president Jim Slater said, much of the coal will be shipped east of the Mississippi.
Local officials applauded the announcement of the expansion, which promises to bring about 150 jobs that pay an average of $58,000 per year.
Colorado had a record coal production year in 2004 with about 40 million tons. Much of that came from the North Fork Valley, where three large mines operate. The largest mine in the state is near Craig.
The new mine near Mack will be comparable in size to the North Fork mines, Coleman said.
Staff writer Nancy Lofholm can be reached at 970-256-1957 or nlofholm@denverpost.com.
