Coal recoverability estimates contribute to local, State, and Federal energy policy decisions and assist governments and planners in determining the socio-economic effects on their regions as the profitable coal resources become depleted.

Other objectives of the coal recoverability program include:

Features in this study that we considered to be restrictions to mining (fig. 4) are: a railroad corridor, an alluvial valley floor, a gas processing plant, and several actively producing oil and gas wells. (See Molnia and others, 1997, for a discussion of these restrictions.)

A proposed coalbed-methane recovery area, the Gillette South Coal Bed Methane Project (U.S. Bureau of Land Management, 1999), includes a large part of the Hilight quadrangle. The results presented in this report assume that the methane project is not a restriction to coal mining. However, as an alternative scenario, we did calculate how much coal might be restricted if mining were not allowed in the coalbed-methane area.

We did not consider coal quality to be a factor in determining the availability or recoverability of the coal resources. However, the quality of a coal is a factor in its marketability because government regulation of environmental pollutants can favor coals of certain qualities.

METHODOLOGY
The study began with the calculation of original resources using a geologic data set previously compiled by Molnia and others (1997). However, in our study, parting thicknesses of 2 ft or less are included as part of the coal resource because such partings would typically be mined as part of the coal. Next, using the restrictions to mining shown in figure 4 and the methodology explained in Rohrbacher and others (1993b), we calculated available resources for the Hilight quadrangle.

As the next step, we developed preliminary mining scenarios for each coal seam, to determine the recoverable resource. Mining cost models were also developed and the recoverable resource tonnage estimates were incorporated into the cost models to calculate the economically recoverable coal resources at different selling prices. The tonnage of economically recoverable coal will necessarily vary with changes in coal prices and production costs.

Cost factors for determining economically recoverable resources from recoverable resource estimates are described by Rohrbacher and others (1993b) and Suffredini and others (1994). In our study, we calculated economically recoverable resources for the following three sales-price levels:

• As much as $3.00 per ton
• As much as $4.00 per ton
• As much as $5.00 per ton

We utilized a coal property-evaluation software package called COALVAL, developed by the U.S. Bureau of Mines (Plis and others, 1993; Suffredini and others, 1994), to efficiently handle the large quantity of cost data associated with our study. COALVAL has the capability to evaluate as many as 25 coal seams, each to be mined with as many as seven different mining methods. The software package produces summary spreadsheets that list the cost (per clean ton) to mine the resources (f.o.b. the load-out) for each property, seam, and mining method. COALVAL performs DCF-ROR¹ (discounted cash flow - rate of return) analyses, and was updated by using 1998 cost indices to calculate 1998 costs for coal production.

COALVAL uses specific mining scenarios to determine coal production costs. Specifically, the software calculates the operating costs associated with mining coal and determines the quantity of coal in each bed available in different production cost ranges (for example, number of tons recoverable at a coal sales price of as much as X dollars per ton; number of tons recoverable at X to Y dollars per ton, etc.).

For purposes of this report, coal is defined to be economically recoverable if the costs connected with its production are less than its sales price, on a per-ton basis, f.o.b. load-out. This approach results in general estimates of the economically recoverable reserves remaining in the quadrangle.

Although general procedures and assumptions developed for the Appalachian coal recoverability analyses are applicable to coal fields in other regions, some specific assumptions and different methods of analysis were used in our Hilight quadrangle study. In particular, we assumed that all mining, for the foreseeable future, would be limited to surface methods (truck and shovel mining) and that this mining would be necessarily restricted to the Wyodak coal beds as discussed in Molnia and others (1997).

In addition, we assumed that parting thicknesses of 2 ft or less would not be removed from the coal beds, and coal beds greater than 4 ft would be mined in conjunction with the Main Wyodak coal bed if the "waste rock-to-coal ratio" (stripping ratio) was 4:1 or less. Finally, we decided to perform the coal recoverability analysis on the basis of this rock-to-coal ratio for each bed instead of on the basis of coal-bed thickness only (fig. 5, fig. 6, and fig. 7).

As a result of the above assumptions and procedural modification for the Hilight quadrangle, we determined that two minable coal-bed units were present—the Main Wyodak, which consists of the Main Wyodak coal bed plus the Rider Wyodak coal bed (Molnia and others, 1997), and the Lower Wyodak. We also divided each of the two minable units into separate sub-units for a more accurate analysis of mining costs. The sub-units are based on the rock-to-coal ratio within each coal-bed unit; as these ratios increase, so do the costs.

In an additional departure from previous coal recoverability studies, Hilight quadrangle coal resources were calculated for the three types of coal ownership that exist within the area—Federal, State, and private. Although the majority of the land surface is privately owned, the majority of the coal is Federally-owned. However, we believed it important to know what coal resources were owned by State and private interests, in addition to those owned by the Federal government.

RESULTS
We calculated the original in-place resource of the Wyodak coal zone within the Hilight quadrangle to be 3,636 million tons. There are no previously mined-out areas within the quadrangle. Resource losses due to restrictions total approximately 167 million tons, which leaves an available resource of 3,470 million tons, or 95 percent of the original resource. If these 3,470 million tons were to be completely developed for mining, 243 million tons of coal would be lost in the actual mining process, resulting in an extractable resource of 3,227 million tons (89 percent of original in-place resource). Because the mined coal would not require washing, there would be no processing losses. Thus, this extractable resource is also the recoverable resource.

Table 1 summarizes the original resources, unavailable resources, available resources, mining losses, and recoverable resources for the study area. The recoverable resources were then evaluated with cost models to determine the amount of economically recoverable resources at three sales-price levels, as shown in table 2.

Our modeling determined that only coal resources with a rock-to-coal ratio of 2:1 or less (equivalent to a production cost of as much as $3.00 per ton) are currently economically recoverable. This category of economically recoverable coal represents only 10.7 percent (389 million tons) of the original resource, as shown graphically in figures 8 and 9. A rock-to-coal ratio of 3:1 resulted in a production cost greater than the current selling price ($3.22 per ton of coal as of January 1998). The amount of economically recoverable coal nearly doubles when a sales price of as much as $4.00 per ton is used; at that price, 20.3 percent (737 million tons) of the original resource is economically recoverable.

At a sales price of as much as $5.00 per ton, the amount of economically recoverable coal nearly doubles again, to 38.9 percent (1,416 million tons). However, this large resource includes coal that would have a rock-to-coal ratio of as much as 4:1, which is higher than current rock-to-coal ratios in operating mines in the Powder River Basin.

Table 2 also shows the amount of economically recoverable Federal, State, and private coal at the same three coal sales-price levels. At a sales price of as much as $3.00 per ton, for example, 10.6 percent (372 million tons) of the Federal coal, 11.6 percent (17 million tons) of the State coal, and 51.3 percent (0.7 million tons) of the private coal in the quadrangle are economically recoverable.

The amount of the economically recoverable coal resource that meets standards for sulfur dioxide emissions (and thus is "compliance coal") could not be determined because of inadequate numbers of coal-quality data points. An unpublished reclamation plan for the proposed Keeline mine within the Hilight quadrangle (Neil Butte Company, 1985) provided a limited amount of coal-quality information; the remainder of our coal-quality data was from samples taken outside the quadrangle. The reclamation plan for the Keeline mine indicated that coals within that lease tract are subbituminous C in rank. On an as-received basis, their sulfur content averages 0.6 percent (and varies from 0.3 percent to 2.0 percent); their ash content averages 7.9 percent; and their heating value averages 8,350 Btu per pound.

These data indicate that some of the coal resources in the quadrangle have a potential sulfur dioxide content greater than 1.2 pounds per million Btu, which would place those resources in a non-compliant-quality status. However, the data are insufficient to identify the location of those resources within the Keeline mine tract or to estimate the tonnage that contains this potential sulfur-dioxide-emission content. In any case, those coals could still be mined, especially if they are blended with coals of lower sulfur content.

Although most of the Hilight quadrangle is located within the Gillette South Coal Bed Methane Project, we believe it is unlikely that this project would restrict coal-mine development. Nonetheless, in table 3, we show the effect on the available and the recoverable resources if mining were not allowed within the area of the coalbed-methane project. If the project area were a restriction, only 14.8 percent of the original resource would be available for mining and only 13.7 percent of the original resource would be recoverable. The economically recoverable coal resource would also be significantly reduced if the project area were a restriction; however, we did not calculate that resource for this scenario.

COMPARISON TO EARLIER STUDY
Molnia and others (1997) calculated coal availability in the Hilight quadrangle as part of an early effort to develop availability methodology for the western United States. That study and our study used different techniques and assumptions; thus the results of the two studies are not directly comparable (table 4).

In addition to a coal availability calculation, our study calculated coal recoverability for the Hilight quadrangle. Our recoverability calculation used the same techniques and assumptions as in our availability calculation. Thus, the availability and recoverability percentages within our study provide a consistent progression from original resource through economically recoverable resource (fig. 8 and fig. 9).

CONCLUSIONS
Results of coal recoverability estimates for the Hilight 7½-minute quadrangle (table 2) indicate that only 10.7 percent (389 million tons) of the original coal resources in the study area can presently be considered economically recoverable. This is approximately the same percentage as was calculated in studies of the Appalachian Basin and the Illinois Basin (Carter and others, 1999).

Nearly 90 percent of the original, in-situ coal resource is estimated to be recoverable in the Hilight quadrangle, whereas only about 30 percent of the original, in-situ coal resource is estimated to be recoverable in the Appalachian and Illinois Basins (Carter and others, 1999). This large difference exists because no previous mining has occurred within the Hilight quadrangle and because there is a relatively small total area where environmental restrictions occur in the Hilight quadrangle. Also, because the Hilight quadrangle is modeled for surface mining, the technical restrictions that can decrease the amount of recoverable coal in underground mining (e.g., overburden thickness, mine barriers, super-adjacent or sub-adjacent coal-bed destruction) are not applicable.

Additional studies of coal recoverability within the Powder River Basin are underway. The results of those studies will need to be analyzed before any basin-wide conclusions can be made.

¹Defined as the rate of return that makes the present worth of future generated cash flow over the life of a project equal to the present worth of all after-tax investments (Barnes, 1980, p. 137).