Alaskan Coal IMPORTS

Over the years, Usibelli Coal Mine has been a saving grace for keeping several interior military bases off of the BRAC list, as the coal that mine provides is necessary to keep the bases' central heating systems warm and as a byproduct the generation of electricity. It fulfills two basic Alaskan wintertime necessities, heat and reading lights. So Alaska has been fortunate, as these bases have so far missed the BRAC hit list, the Base Re-Alignment and Closure commission. But maybe greed has finally caused an upset in the non-competition to supply that coal. Basically Usibelli has not had to worry about the competition, until now. The military logistics buyers look for long term energy contracts, usually at 5-year intervals and at the same time tries to find deals that saves money for the U.S. Taxpayers. Now with no competition, the coal coming from the Usibelli pit was of poor quality, a sub-bituminous low BTU content coal with a high ash content, so besides taking more coal to perform the same basic job of boiling water, as a poor quality product it also decreases efficiency which increases operational and maintenance costs. Since many of the Alaskan military base utility infrastructure has been “Privatized”, the new owners are interested in anything that can lower the O&M labor costs, as money saved is money earned and stuffed away in executives' pockets. And with the “Privatization” contracts, the fuel remains the responsibility of the government. The 5-year coal supply contracts for Alaska are up for grabs, with old contracts expiring in 2012. So the Defense Logistics Agency has sent out early on a per-solicitation to all interested entities for fulfilling the future fuel requirements. When the 2007 “new” coal contracts were signed then sealed then delivered for deliveries of coal, the DESC realized a %5 DECREASE in coal costs delivered to the military infrastructure in the Lower-48. In Alaska, it was just the opposite wherein delivered coal to the bases INCREASED 14%, that was another $20-million added on to the $109-million dollar price tag contract between Uncle Sam and Usibilli Mine, for Clear Air Force base, Eielson Air Force Base and Ft. Wainwright ARMY installation. Cautionary Note: Clear Air Force base does nothing today for national security, it should be mothballed. Eielson was turned over to the National Guard, but maintained still by the Air Force budget because of representative strong-arm tactics. This place has no importance today either, as now that the space shuttle program has been mothballed, so should Eielson as the long runway is no longer needed as an emergency touchdown for the flying brick. With that in mind, it is no doubt costly to the taxpayers, trying to keep these aging still and dilapidated military infrastructures up and running. Bottom-line, shut then down if not needed! Now Joe's coal pit was #7, in the top ten, for corporations supplying fuel to the military. BP was #3, so one can see how costly the state of Alaska military bases are to the taxpayers accounting for 6% of the 2-billion dollar price tag to supply energy to the military. One supplier garnishes 6% of that budget on a single state, when the other fuel providers work worldwide! So this increase in costs did not sit well with the brass, as the bases had escaped closure due many factors including operating costs and now the costs were starting a creep even higher with respect to percentage changes. And here is the dilemma. If competition were to enter the picture, say from Wyoming's huge open pit coal mines, wherein there is very efficient mine operations and already a healthy transportation system to the water-front, could Usibilli lower costs and not get in trouble upon a False Claims investigation? The False Claims Act disallows a defense contractor from raising the cost of deliverable or price coercion of such deliverables based on the competition environment. So we may see coal imports coming into Seward, off-loaded onto awaiting trains and hauled to the appropriate interior bases. And It is noted that the Fed.'s subsidize the rail line in Alaska, so that money may be re-earmarked not to projects affordable by the state, but to offset coal import delivery costs to these “mission critical” sites, in line with government starting to cut costs and withdraw cold-turkey wise upon “pork” addictions. Remember, Ted's legacy was “pork”. Now the Alaska Railroad was this states 1^st “Big” failure, as when insolvency was front and center, the railroad went on the auction block as was required by Congress when Statehood was approved. Insolvency in this case means weaned off of Uncle Sam welfare. There came no Casey Jones' takers, as the railroad ROW is the most toxic hazardous waste zone in Alaska, and the Fed.'s would not or could not guarantee they would take responsibility for any cleanup costs. So the state ended up buying a rabbits foot and at the same time took over responsibility to run an entity that was already run into the ground. The rabbits foot was a good deal. Not so the railroad and the foot rubbing hasn't really proved worth its while. But there was hope, as the Fed.'s have for years subsidized a large percentage of the operating and maintenance costs for the rail traffic, that is why today - just yesterday as a matter of fact - you still see empty coal cars being trained to somewhere then back again, to book time so the Fed.'s can keep sending welfare aid this way to keep the rail afloat. But someone is on to this and wants to use the empty cars to deliver coal to the bases, since Uncle Sam is already paying for the trains through the subsidies. Supposedly there are individuals looking into this already and if they have enough lobbying power so the appropriations bill on re-write earmarks the millions from federal welfare to trains for the specific job of supplying the military bases and coal contracts can be finalized from mines elsewhere with high quality coal on the cheap, Usibilli could find some competition. Especially if the imported coal is lower in ash which means it will make the environmentalist happy, as there are lawsuits defending the waters off Seward from annihilation by coal dust storms, from sub-standard coal coming from Joe's pit for export. And energy Interested energy companies interested in supplying coal believe they can mine and export coal to Alaska cheaper then what is being mined and sold by local interest. What do you mean it isn't possible? No different then how we get cheated at the gas pump, when the Trans-Alaska-Pipeline runs in our own backyard, right past a refinery, yet we pay enough that allows imports to compete? Low sulfur diesel is being imported, from Canada and Korea - crazy it is. And there is talk about importing LNG, to supply the dwindling resources in Cook Inlet and how much stranded gas exists up north? So we complain about keeping jobs here in the state, yet we continue to bite the hand that feeds, eventually to our detriment. Bottom-line, as a concerned citizen trying to help out getting this nation's economy back in step with reality, it is time to close down any military installation that is not doing its duty along with the MDS in Delta Junction at Ft. Greely along with the Kodiak Launch facility. And what's with the M.V. Susitna? It has been found but has not found a home or a reason for existence. Scrap sounds like a good deal!