by Lee Buchsbaum
After more than 30 years of production and a billion tons of coal shipped, Foundation Coal West (FCW), a subsidiary of Foundation Coal Holding Inc., continues to operate two of the original surface mines in Wyoming’s Powder River Basin.
The older of these, Belle Ayr, was staked out in 1972. Located just south of Gillette, it mined 28.8 million tons last year. Both have proven to be two of the most successful, safe, dynamic, and resilient surface operations in the nation. Belle Ayr’s sister mine Eagle Butte, produced 20.4 million tons last year.
After three decades of continuous improvements and operations, both mines have been undergoing significant changes in operations and, since 2000, in personnel. As many of the initial and
early hires have begun to retire, Foundation is now adjusting its operating philosophies to help attract, retain, and refine the new “millennial generation” of workers who are generally under 30 years of age.
With 64% of their workforce hired since 2000, FCW is also striving to ensure that there will be plenty of coal to mine throughout their new hires’ careers. Last year Eagle Butte successfully bid on a new 224 million ton federal coal lease and currently Belle Ayr is seeking a similar Lease by Application (LBA), actions which will extend the life of both mines several decades, if markets prevail.
Located just north of the town of Gillette, Eagle Butte extracts from two seams which together average roughly 100 ft in thickness. The Roland seam, which has a higher average calorific value of 8,400 Btu/lb, is closer to the surface. Beneath it is the Smith, which is lower in calorific value. Stripping ratios at Eagle Butte are only 2-2.5:1, which allows the mine to run smaller fleets and deploy less equipment. On February 20, 2008, the mine successfully bid on a new federal coal lease containing approximately 224 million tons of proven and probable reserves. This coal, located to the west of current operations, will necessitate the moving of a state road. The lease became effective on May 1, 2008. Eagle Butte now has approximately 504.7 million tons and a sustainable mine life of 25 more years.
Belle Ayr produces from the Wyodak-Anderson seam which has an average seam thickness of around 75 ft. With approximately 255.6 million tons of reserves, Belle Ayr optimistically projects at least nine more years of production if market conditions warrant. And FCW plans to apply for and bid on several hundred million tons of as yet unleased federal coal that adjoins the mine.
New Conveyors and New Train Landing Spots Yield Greater Efficiencies
One of the ironies with surface mining is that the more successful a company is in extracting tonnage, reserves deplete more quickly and haul distances grow. Around the time the mining business was acutely feeling the tire shortage and diesel prices skyrocketed in 2006, Belle Ayr was faced with an extended haulage length from pit to crusher after several decades of mining. These simultaneous events led management to determine that the time was right to install a two mile conveyor, to save on tires, fuel, and truck wear and tear.
The new conveyor at Belle Ayr has proven tremendously cost effective. Today, 95% to 98% of Belle Ayr’s coal is dumped onto the conveyor. Trucks dump onto a stilling shed that sits atop a near pit crusher and from there the coal is hauled to storage silos. “It had become a pretty long haul. It was hard on tires and drivers. It was so long, it had become pretty monotonous. Since we’ve installed the conveyor, our safety has improved among the truck driver ranks, and today we can service our customers much better,” said Steve Rennell, president of operations, FCW.
“Anymore, we only haul long with our trucks when the conveyor is down,” said Steve Laird, manager lands and legislative and public affairs, Wyoming Land Co. “By choosing to convey, we’ve cut down dramatically on tire costs, wear and tear on our trucks, and reduced our overall fuel usage in the coal operation.”
Today, instead of coal, many of Belle Ayr’s redeployed trucks are hauling dirt, taking up the slack from increasing stripping ratios of 3:1 to 4:1. This strategy prevented any reduction in personnel needs with the introduction of the conveyor. While some folks were shifted into conveyor maintenance, most employees simply turned their trucks into dirt haulers. “We’ve moved up to the 360-ton class haul trucks. We had done that in 2003 with acquisition of our 5500 Terex,” said Rennell.
Besides getting bigger, Foundation’s equipment has also gotten smarter. “Mining used to be about a lot of horsepower and a lot of steel, it was pretty low tech. But now all of our equipment talks to satellites. We have no surveyors. We design something in the pit, and it’s transferred out to the folks in the pit. Our truck drivers know the conditions of the road because sensors and computers measure the movements of the racks and pins in the trucks as they traverse the road. That information is interpolated and sent back in real time to those behind the wheel. Technology feeds back on their performance, helping all of us do our jobs better,” said Rennell.
FCW’s overburden loading fleet includes two shovels in the 120-ton class, and three shovels in the 80-ton class. They also have a number of smaller shovels in the 40-ton class that are primarily used in coal. FCW’s mobile equipment fleet consists of 16 large 360-ton trucks complemented by 33 trucks in the 240-ton class. Over the years, many of FCW’s older trucks have been rebuilt, and even with thousands of hours of service they continue to perform.
Their most recent truck/shovel purchases have included two 120-ton shovels and a fleet of 360-ton trucks. Most of this equipment is now several years old. As a result of these purchases, FCW has experienced an increase in productivity due to an economy of scale—that is, the increased size has resulted in improvements in almost every production parameter from yards per shovel shift to tons per truck-shift operated.
Other purchases have been in the realm of real time information, both operational or maintenance. These advancements help them to further optimize their assets. “We want utilization in the mid-90%. Around here, you don’t see too many parked trucks. We want to have them out there moving dirt or hauling coal,” said Rennell.
Other operational enhancements include trackage added to the mine’s rail loop and an increased number of “landing spots” or train sidings. “You need a lot of storage to service trains. The more landing spots you have here, the trains you can fill. Efficiencies gained by the railroad are efficiencies gained by us. That move significantly helped our situation,” said Rennell.
No Drag on Production: Foundation’s Dragline-less Operations
While much of the incredible volumes of production coming out of the PRB is helped by the use of draglines, Foundation has none of the big machines. In a region dominated by them, Belle Ayr has never employed one. While Rennell concedes that in the past draglines were more cost effective on a cost-per-yard basis, those formulas have changed with the introduction of the new ultra class shovels and trucks. “360 ton trucks move dirt on a very equivalent basis as a dragline for an equivalent amount of capacity. Also a truck shovel spread costs roughly 50% less than a dragline. We pride ourselves on being able to move dirt as effectively with our fleets than others do with draglines,” said Rennell.
FCW’s choice is not all based in economics, but on geological conditions, too. “While our highwall material is very good to dig, it’s very poor for dump-side stability. In the past, some folks around here have had dump-side problems,” said Rennell. FCW has picked up a few extra trains here and there because of those sorts of issues.
Evolving Strategies Going Forward
FCW plans to deploy more dozer-push operations than they have in the past. With the right conditions, Rennell has found that the mine can cast blast and doze more effectively. It’s also generally more cost effective to move dirt by blowing it than by pushing it with a dozer and truck/shovel in cooperation. “We’re also working to upgrade our dispatching at both mines and to have more data flowing in real time to our employees. That helps them make quicker, better decisions,” Rennell said.
Though typically FCW has two to three weeks of active inventory, in the future Rennell would like to increase what’s on hand and be able to respond to market conditions quickly. “I’d like to carry bigger coal inventories than in the past. That allows us to respond quicker. If a customer is desperate for additional coal and the mine can provide it, they remember that. At the end of the day, we’re not here to provide jobs, we’re here to service customers and sell coal. That is what provides jobs,” said Rennell.
Training and Retaining the Next Generation of Surface Miners
When Belle Ayr and Eagle Butte first opened in the 1970s, like many PRB mines, staffing was challenging and many miners were recruited from other regions. Over the years, the majority of those workers stayed at what became FCW for their entire careers. For some that translated to 20 to 25 years of service before retirement. And for many, that length of service has recently been reached, resulting in a wave of retirements. This turnover has created a need for new plans of action when dealing with new employees.
Between Belle Ayr and Eagle Butte, FCW has a total workforce, both hourly and salaried, of more than 600. But because of the geological differences between the mines, there are half again as many workers at Belle Ayr (360) than at Eagle Butte (230). “As we bring in new people to maintain our staffing levels, we assign them a mentor who they can go to at any time with any questions they might have,” said Rennell. “The message I give them is that there is nothing out here worth getting hurt for. When in doubt, stop what you’re doing. If you’re asked to do something you’re not comfortable with, stop. Bottom line is, if we have an accident, we’re not as efficient.”
FCW dedication to safety has yielded them nearly two years of lost time accident (LTA)-free operations at Eagle Butte, and almost a year without an LTA at Belle Ayr. “Every one of our group meetings start with safety. It’s a first. It’s always first. As an employee, you have to feel safe. Once they do, then you have their attention,” said Rennell.
With a large group of younger workers beginning their careers, FCW has also had to adjust their training strategies to the characteristics of the new millennial generation. “Our new workforce has a different skill set than those of generations past,” said Rennell. “These employees are of the technology generation. They don’t always expect to see something in writing. They expect to see it on a screen. Our new workforce is much more electronically adept. They come to us with a different skill set and mentality than folks who applied here in the 1980s—or my generation for that matter,” who has several decades of service under his belt.
As has been widely reported, staffing a highly-skilled workforce with qualified personnel has proven to be a monumental task. Even within today’s current soft coal market, FCW still has a few skilled positions open, especially electricians. “We’re looking to hire someone who understands current programming techniques and who can basically plug a laptop into our newest trucks and talk to them electronically,” said Rennell.
“Continuous improvement is our cultural mantra. We work everyday to find a way to do the things we do a little bit better. We call our employees, both hourly and salaried, ‘BRTs’, or barrier removal teams. Our goal is to get folks who are knowledgeable in an area and have them brainstorm ways to fix those things. We emphasize that we are all business partners, not just employees of a large, distant corporation,” said Rennell.
This inclusive approach helps motivate each individual to come up with ideas that will make the entire business stronger. While FCW has purchased newer, larger equipment and deployed their new conveyor at Belle Ayr, Rennell cites employee engagement as the single biggest enhancement toward increased productivity and reducing operating costs. Employees are encouraged to be involved in all areas of operation and are rewarded with more trust and the ability to make management-level decisions when necessary, which Rennell said yields better employee performance.
“Decisions that were once held and made from my position are being shifted to hourly employees. It’s about making a ‘point of attack decision.’ With the right training and flexibility, they can make decisions that previously would require management involvement. We’ve found that with more responsibility, often the employee is more productive,” said Rennell.
Five years ago FCW’s average employee was in their 50s with 17 years of service. With all of the new hires, that average is now roughly 40 years old with 10 years of service. “We had a major expansion in 1980-1982. When people hit 20 plus years, many of them chose to retire.”
One of the characteristics of this new technology driven generation is a shortened attention span—one that often times is compromised by routine. “You have a real dichotomy. High efficiency is doing the same thing right over and over again, but that builds monotony. How do you encourage employees to do this while continuing to keep their attention to the same levels?” said Rennell. Foundation has searched for ways to maintain efficiency while keeping employees engaged and breaking up the monotony, from the installation of Satellite Radio in most of the vehicles, to implementing a cross training system that enables employees to do different tasks each day. “One day that can be driving a truck. The next it’s operating a shovel, followed by a day on a blade. While that breaks up a potential for monotony, by becoming cross-trained, we also have a much more flexible and valuable employee. Everybody out here in operations can drive a truck, but the more you can run, the more you can get paid.” said Rennell.
Rennell reiterated that instilling a safety culture is key, particularly when coupled with a cross-training program. Everybody—salaried and hourly-paid employees—has 16 hours of corporate-provided training. The company also encourages employees to attend a higher learning facility to earn a degree related to their field. FCW offers tuition compensation as an incentive. There is even a FCW scholarship program in at least one Montana school which itself has led to some permanent hires.
Another difference that Rennell has noticed is that if you ask this new generation what they do, they’ll talk about their stuff and their out of work activities, not their profession. “Their jobs are a means to an end, versus an end in itself. That’s not bad, it’s just different. This generation works just as hard, just as intelligently as any preceding generation, but what may be different is that they don’t define themselves by what they do. By involving them in as many decisions as possible, we are honoring what’s unique about this generation in the hope that that’s what will attract them and keep them here,” said Rennell. With good, well paying jobs getting scarcer and scarcer for the millennial generation, FCW wants new employees to know that they too will have the opportunity to one day retire from these jobs too.
Buchsbaum is a Denver-based freelance writer and photographer specializing in industrial subjects. He can be reached through his Web site at www.lmbphotography or by phone at 303-746-8172.
