Representatives from the energy industry gathered Thursday in Billings under the banner mantra of energy independence.
U.S. Sen. Steve Daines primarily touted the phrase at the Montana Energy Summit event he organized, featuring industry executives and government officials on stage.
If the theme of the event was the celebration of the domestic natural resource supply, then Harold Hamm was perhaps the speaker who embodied that most.
The Continental Resources founder and CEO spoke about the Bakken Shale Formation as the gift that keeps on giving. His company is the formation's largest leaseholder.
“You hear about peak consumption in the world and things like that," Hamm said. "I never liked the phrase 'peak.'"
Hamm said that five years ago, his company would have been excited to see 700,000 barrels of crude produced daily in the Bakken. Now the trends are pointing toward record production of 1.2 million barrels in the near future.
Hamm's pitch for domestic energy independence was couched in memories of the 1973 oil embargo, which was enforced by foreign oil exporters.
“Those remembrances are vivid," he said, "Waiting in line for gasoline.”
He said that event spurred a change in domestic energy policy that's just recently materialized.
Another recent development in energy is the growth of renewable energy sources, which had a place at the summit. Panelists speaking about that sector stressed the all-of-the-above energy attitude to the audience filled with oil, gas and coal interests.
Solar developer Mark Klein said his company's largest projects are in Yellowstone County.
“Our focus is about 500 megawatts in the state of Montana, and that represents a capital expenditure for those projects in the neighborhood of $500 (million) to $700 million dollars.”
Of those 500 megawatts, he said 400 megawatts would be exported via the transmission lines that extend from Colstrip.
Renewable energy's disruption to fossil fuel sectors also came up during Thursday's round of speakers. In addition to the more widely used natural gas, renewable sources of electricity have pushed market prices below that of sources like coal.
That has put coal companies, and communities that rely on them, on pins and needles. One of those communities is the Crow Reservation, which is the headquarters of the Absaloka coal mine.
Speaking as part of a panel on the coal industry, David Freedman, special council to Crow Chairman AJ Not Afraid for economics and energy resource development, said production at the mine has decreased significantly. With an annual production capacity of 7.5 million tons, he said the mine is hovering around 3.5 million tons.
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The Absaloka mine is run by Westmoreland, which eyed bankruptcy earlier this year and has seen its stock price plummet. Last week, the company announced a cash infusion that would keep the company alive.
Meanwhile, the Crow Tribe is looking to secure foreign export deals, Freedman said.
“There’s still a steady demand abroad," he said. "We recognize that basically, from Crow’s perspective, they have 9 billion mine-able tons of coal on the reservation.”
As expected, the coal discussion centered on the fate of Colstrip's power plant, which faces the closure of units 1 and 2 by 2022 and the potential closure of its remaining two units by the end of that decade.
In addition to market forces, panelists often talked about regulation they said hindered business. Dale Lebsack, president of Talen Energy's Montana operation, said some regulations that govern air emission and waterway discharges weren't about water or air at all.
"Make no mistake: it’s all about making coal more expensive and ultimately putting it out of business," he said. "It's really about getting it to the point to where it's so expensive that it's not a profitable business to run.”
Economist Pat Barkey, who directs the Montana Bureau of Business and Economic Research, said his office is working on a study of the effects of the closure of the Colstrip plant.
While he kept any figures close to his chest, he said the loss in tax revenue could be felt throughout Montana. Large power customers like universities or hospitals might see price spikes if they lose Colstrip as a nearby power source, he said.
It would be hard for a facility that size not to change the consumer landscape with its closure.
“But with wholesale prices coming down, its mass effect is that if we lose this kind of capacity in the state, its going to have an impact on the entire region,” Barkey said.
The panelists didn't discuss the potential for specific closure dates. While the six shareholders of the plant also haven't explicitly set a date, there are many signs that 2027 might be the year.
The plant's largest shareholder, Puget Sound Energy, has agreed to be financially ready to close the plant by 2027. Avista Corp. has named that year as the end of the plant's "useful life."
Owners Portland General Electric and PacifiCorp are looking at cutting ties by 2035 and 2030, respectively.
As part of the process, companies have announced millions of dollars for Colstrip to help the town transition.
But those who live and work in Colstrip remain committed to the plant's future, as evidenced by Thursday's panelists.
“We will continue to work hard to see Colstrip run for as long as it can,” Lebsack said.