those of even a few decades ago. Coal mines require substantial capital investment in both permanent structures and depreciable mining equipment, exceeding $75 per annual ton of capacity in large underground coal mines and $30 or more per annual ton for large surface coal mines.

The overall coal mining process consists of several sequential stages: (1) exploration of a potentially economic coal seam to assess minable reserves, environmental issues, marketable reserves, potential markets, and permitting risks; (2) analysis and selection of a mining plan; (3) securing the markets; (4) developing the mine; (5) extracting the coal; (6) processing the coal if necessary; and (7) decommissioning the mine and releasing the property for post-mining use. The two essential requirements that must be fulfilled before a prospective coal mine can enter the development stage are confirmation that there are sufficient minable reserves of adequate quality with no unacceptable environmental or permitting risks, and confirmation of an assured or contracted market for a substantial fraction of the coal that will be mined.

Coal Mining

Coal seams can be mined by surface or underground methods (Figure 4.3), with the choice of mining method dictated by both technical and economic factors. The most important technical factors are the thickness of the coal seam, the depth of the coal seam, the inclination of the seam, and the surface topography.

FIGURE 4.3 Schematic depiction of the range of different surface and underground types of coal mining, illustrating types of access to coal deposits and mining terminology. SOURCE: KGS (2006).



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