Rise And Fall Of The Nova Scotia Coal Industry

.. sulfur dioxide (SO2). This gas is toxic and can be severely irritating to the eyes and lungs. In the atmosphere sulfur dioxide combines with water vapour to produce sulfuric acid which is then removed through precipitation and it falls to earth as acid rain.

There are presently methods available that are able to remove some of the sulfur from coal prior to burning but the process is expensive and only partially successful. Another alternative is burning low sulfur coal but more often than not this coal is lower quality coal and more of it must be burnt in order to get the same output of energy (Montgomery, 1990). It is also possible to remove the sulfur gases after the coal is burnt but before it is released to the atmosphere through the use of scrubbers but this is expensive and can increase the cost of using coal by up to 25 per cent (Alm, Curhan, 1984).

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Oil also contains sulfur but most of it is removed during the refining process and by the time it is burnt it only contains about 10 per cent of the sulfur that coal does. The burning of coal also produces a great deal of solid waste. Ash left over from burning coal can amount to five to twenty percent of the original volume. In the atmosphere it fouls the air and if it is captured by scrubbers it still must be safely disposed of in some manner.

Coal ash is composed mostly of incombustible silicate materials but it also contains toxic metals and even trace amounts of uranium.If left exposed to the elements the fine ash weathers rapidly and the toxic metals leach out posing a pollution threat to ground and surface water. A single coal fired power plant can produce up to a million tonnes of solid waste per year, all of which must be safely disposed of or treated at great cost (Montgomery, 1990) Devco By the mid 1960’s coal mining in Nova Scotia was in serious trouble. With cheap imported oil and an expanding network of oil and gas pipelines coal was becoming more expensive to use than its alternatives. In 1963 the federal government established the Cape Breton Development Corporation (Devco) to slowly wind down the industry and find alternative employment and development opportunities for those affected communities (Doern, Toner, 1985). By 1971 Devco had cut mining employment by half.

With Devco now in charge and their agenda clear it looked like the end for the unprofitable coal mining industry. Then the Arab oil embargo of 1973 quadrupled oil prices and the interest in coal was rekindled around the world as every major oil importing country gave high priority to reducing their dependence on foreign oil. Output of coal by the industry increased slightly (see Fig. 4) but would never again be as great as it was during the first half of the century. The second oil price increase in 1976 rose oil prices by another 160 per cent and the price of Cape Breton coal rose from eight dollars per tonne in 1967 to 52 dollars per tonne by 1984. The company began to open new mines Lingan in 1974, Prince in 1976 and in 1987 it began developing a new 600 million-dollar mine at Donkin, predicted to be the largest underground mine in North America.

The company was finding new export markets and had just received a 33-year contract to supply the Nova Scotia Power Corporation, which was scrambling to convert its generating plants to coal. The future once again looked bright for the industry as the Fig. 4 Graph showing the Nova Scotia coal output over the last century and a half. Notice the peaks during the first and second world wars and the increase during the 70’s. Source: Statistics Canada.

price of oil was 40 dollars (U.S.) per barrel and was predicted to be 100 dollars per barrel by the end of the century. The analysts were wrong however, by 1999 the price was more like 15 dollars and the oil industry once again was on its way out (Cameron, 1999). As mentioned before Devco was more of a regional development plan rather than a business, else the Nova Scotia coal industry would have folded a lot sooner than it had.

Devco acted as a type of life support system for the Nova Scotian economy effectively serving as a wealth transfer system transfering money from the have provinces to have nots. As of 1995 Devco had managed to acquire 1.2 billion dollars in losses in just 27 years in operation (MacIsaac, 1995). Devco actually turned a profit every year from 1993 to 1997 but those profits were not enough to cover the companies non-operating costs such as pensions, workers compensation, long-term liabilities, and decommissioning of the mines. Finally in January of 1998 the federal government announced that it was privatizing Devco and quitting the coal industry it had supported since 1967.In 2000 Devco was down to one working coal mine which Ottawa planned to sell along with the rest of its coal assets by the end of the year. However there is no guarantee that a private company will emerge to take over operation of the Prince mine (Cameron, 1999).

The collapse of any regions major industry will have a serious impact on the population. Regional net migration is affected by Push/Pull factors. Push factors are those that cause people to leave an area. In the case of Nova Scotia the major push factor is a lack of jobs available due to the collapse of the coal mining industry and the recent moratorium placed on the cod fishing industry.Things have gotten so bad that a 12 dollar an hour job in the west has been sufficient to convince some people to leave the province (Daily Commercial News, 2000).

Pull factors are those that attract people to a particular region. Recently the trend is a general migration westward towards the booming economies of Ontario, and British Columbia (See Fig. 5).

This creates a more favourable economic climate for both regions as one gets relief for it’s social assistance programs and the other gets much needed labour.Province Total In-Migrants Total Out-Migrants Net Migration Newfoundland 4779 8603 -3824 P.E.I.

1438 1233 +205 Nova Scotia 8260 9340 -1080 New Brunswick 6484 7215 -731 Quebec 12295 19180 -6885 Ontario 41719 37660 +4059 Manitoba 13339 11267 +2072 Saskatchewan 11093 13309 -2216 Alberta 29412 29647 -235 British Columbia 37172 26510 +10662 Fig. 5 Interprovincial migration January-June 1995. Source: Western Report Nov. 27 1995.

The Future of the Nova Scotia Coal Industry If the OPEC years have taught us anything its that our reliance on foreign oil can leave us vulnerable to fuel shortages. Shortages not only caused by embargoes, but since fossil fuels are a non-renewable resource, from just depleting the worlds finite supply. As seen in the seventies when the price of oil rose drastically, interest in coal mining was renewed and such will be the case again. Coal is the most abundant fossil fuel on the face of the earth (see Fig. 6) and its use was only discontinued because the other, less abundant, fuels were cheaper to transport.As our reserves of natural gas and oil deplete the law of supply and demand states their price will go up until such a time where coal once again becomes competitive in the industrial market.

As well there are various technologies that exist in order to change the form of coal so it is more easily transported. Currently there are two processes; Gasification and Liquefaction. Coal gasification is a process for converting coal partially or completely to combustible gases. After purification, these gases – carbon monoxide, carbon dioxide, Fig. 6 Energy content of the world’s initial supply of recoverable fossil fuels is given in units of 1015 thermal kilowatt-hours.

Coal and lignite, for example, contain 55.9 x 1015 kilowatt hours of energy and represent 88.8 percent of the recoverable energy.

Source: Siever, 1978. hydrogen, methane, and nitrogen – can be used as fuels or as raw materials for chemical or fertilizer manufacture. There are many techniques to accomplish this but all involve heating the coal with steam in the absence of air. Currently the heat from burning this gas amounts to only 15 to 30 per cent of what can be obtained with an equal volume of natural gas (Montgomery, 1990).

Coal liquefaction is a process that involves first the manufacture of carbon dioxide and hydrogen gases from the coal. Heating these gases in the presence of a certain catalyst at high temperatures will cause them to be transformed into liquid hydrocarbons (petroleum).Currently these processes are uneconomical and only those countries, which have no domestic oil or gas reserves, have made them viable.

Germany used this technique to produce synthetic diesel fuel during WWII and currently South Africa has a coal liquefaction plant in operation making gasoline and fuel oil (Miller, 1996). Summary In summary, the Nova Scotia coal mining industry is not dead, it is only on standby until such a time as it becomes economically viable. The same market forces and concepts that had given rise to it, and led to its demise will eventually revitalize it. Once the oil and gas reserves of the western provinces have been depleted Nova Scotia may become one of the have provinces supporting their failing industries. We may even see a shift in net-migration eastward.

How far off into the future this will take place no one knows for sure, but the worlds hunger for fossil fuels is insatiable and it is only a matter of time. Geography.