First load of coal ships out of Grants
More coal trains to roll through Gallup

By Helen Davis
Cibola County Bureau

GRANTS — Peabody Energy, based in St. Louis, announced this week the that the El Segundo Mine near Grants began shipping out its first loads of coal last Saturday.

The coal mine is adjacent to the better-known Lee Ranch Coal Mine, also a Peabody enterprise. El Segundo, which means "The Second," in Spanish, will serve two power plants in Arizona and haul its product by Burlington Northern Santa Fe and Union Pacific rail transport.

El Segundo has agreements to supply coal to the Arizona Public Service Company. The mine will provide 65 million tons of over 19 years to the Cholla Generating Station near Joseph City, Ariz. The new plant will also provide an unstated amount of coal to Tucson Electric Power Company’s Springerville Generating Station in Springerville, Ariz., under a contract that runs until the year 2020, Beth Sutton, spokeswoman for Peabody, said late Thursday.
The El Segundo mine has been in the works since plans were announced in 2006. Last weekend's shipment indicates the first stage in bringing the mine up to an expected six million tons of coal a year, Sutton said.

Between the two plants, Peabody employs approximately 265 workers locally, according to a news release this week. Sutton said the majority of workers in the mines are from the Cibola area.

The plants put $85 million into the Cibola/Grants area in wages and benefits, contracts and taxes, the release stated. Sutton added that applying the standard “times four” mulitplier used to figure the recirculated impact of a dollar, the economic benefit of the Peabody mines is nearly $350 million a year. The company invested nearly $70 million in capital developing the mine, according to company material.

Cibola Communities Economic Development Foundation Director Star Gonzales said the foundation was aware the mine was in the works, but had not been notified the first shipment had gone out. She added that she is pleased with the progress and supports mining in the area as an economic boost.

El Segundo is the first new coal mine opened in New Mexico in more than 20 years. Coal-fired plants produce electricity at approximately one-quarter the price of natural gas, the company release states.

On the Web: http://www.peabodyenergy.com/default-netscape.asp