Administrative

 

Western Fuels Association is a cooperative enterprise operating on a not-for-profit basis to provide coal and other services for the generation of electricity by consumer owned utilities. Western Fuels’ member-owners are rural electric generation and transmission cooperatives, municipal utilities, and other public power entities. Western Fuels Association is a national fuel supply cooperative with considerable and diverse experience in coal mining, coal procurement, and transportation management.

For close to three decades, WFA has amassed and utilized coal supply experience for its Members’ plant operations. In 2005, WFA was responsible for procurement and delivery of 16.5 million tons of coal on behalf of its members. WFA supplies coal to the following member plants:

  1. Laramie River Station (LRS) in Wheatland, Wyoming, operated by Basin Electric Power Cooperative. WFA purchases coal and manages deliveries by rail. WFA supplied tons of Powder River Basin coal in 2005.

  2. Nearman Creek Station in Kansas City, Kansas, operated by Kansas City Board of Public Utilities. WFA purchases coal and manages deliveries by rail. WFA supplied Nearman Creek 1.1 million tons of Powder River Basin coal in 2005.

  3. Quindaro Station in Kansas City, Kansas, operated by Kansas City Board of Public Utilities. WFA purchases coal and manages rail transportation. Quindaro took 0.6 million tons of Powder River Basin coal in 2005.

  4. Sikeston Station in Sikeston, Missouri, operated by Sikeston Board of Municipal Utilities. WFA purchases coal and manages rail transportation. WFA supplied tons of Powder River Basin coal in 2005.

  5. Holcomb Station in Garden City, Kansas operated by Sunflower Electric Power Corporation. WFA is responsible for coal purchases and rail transportation. WFA supplied Holcomb 1.6 million tons of Powder River Basin coal in 2005.

  6. Sherco 3 at Becker, Minnesota where Southern Minnesota Municipal Power Agency (SMMPA) owns 41 percent of this unit. WFA provides coal procurement and rail transportation for SMMPA’s share of fuel supply. WFA supplied tons of Powder River Basin coal in 2005.

  7. Escalante Station in Prewitt, New Mexico is operated by Tri-State Generation & Transmission Association. WFA purchases coal from the Lee Ranch Mine and operates the Escalante-Western Railway to transport it to the Escalante Station. WFA provided 1.1 million tons of coal in 2005.

  8. Craig Station in Craig, Colorado is operated by Tri-State Generation & Transmission Association. WFA manages Western Fuels-Colorado’s coal contract with Colowyo Coal Company for Tri-State’s Craig Station. WFA manages close to 1.5 million tons of coal per year under this contract.

  9. Nucla Station in Nucla, Colorado is operated by Tri-State Generation and Transmission Association. WFA manages the New Horizon Mine owned by Western Fuels-Colorado in Nucla. This mine supplies the coal needs of the Nucla Station. In 2005 the mine delivered 426,730 tons of coal.

 

Western Fuels’ Members are entitled to an array of services including coal procurement and transportation negotiations and contract administration as well as access to WFA’s expertise in coal mining, permitting and geologic investigation.

WFA either owns or leases approximately 1600 rail cars and manages their scheduling, maintenance and repair on behalf of its members. Most of these cars are in service with BNSF and UP railroads. WFA’s Director of Transportation stationed in Gillette, Wyoming oversees rail operations and manages the liaison between the power plant operators, mine operators, and railroads. As noted above, WFA also operates the Escalante-Western Railway in New Mexico.

 

In summary, Western Fuels provides the following services to its Members:

Coal Purchasing

  • Prepare requests for proposal, evaluates bid and recommends coal suppliers

  • Monitor the over the counter market for purchase opportunities

  • Conduct coal market and transportation research

  • Negotiate and administer coal contracts

  • Attend scale tests and verify scale results for payment of coal and transportation services

  • Cross-checking of coal samples in case of a coal quality disagreement

  • Receive, review for correctness and compliance with the contractual provisions, and approve/disapprove all coal and transportation invoices

 

Transportation

  • Negotiate transportation contracts/tariffs and manage the same including the development of rail negotiation strategies.

  • Manage rail car fleets for members including:

      • Purchase/lease rail car equipment for members>

      Maintain rail cars

      General pooling of all members railcars which results in a reduced car requirement and more flexibility in utilizing "slots"

      Schedule coal shipments with railroads for coal transportation between mines and power plants and provide contact point for all parties.

 

Other Services

  • Geologic investigation (drilling, mapping and reserve assessment)

  • Land acquisition (leasing or purchasing from private parties; leasing of federal land)

  • Permitting (liaison with federal, state and local government agencies)

  • Mine engineering services (mine planning, mining cost estimates, feasibility studies, reserve verification)

  • Cost estimates for railroad buildout

  • Site evaluation and location for new generation facilities

 

When required by WFA’s Members, WFA also provides contact with local, state and federal governments, as well as dealing with the STB (Surface Transportation Board).  If required, legal services are also available through WFA’s Corporate Counsel.

The WFA staff is located in Westminster, Colorado and Gillette, Wyoming. Having WFA’s presence in Gillette, in the heart of the southern PRB, provides readily available “eyes and ears” on behalf of the members to facilitate coal shipment coordination and face to face contact with mining and railroad personnel in the Gillette area.