Mahanoy City, Schuylkill County, PA -
Blaschak Anthracite, one of Schuylkill County’s largest producers of coal, is gearing up for what it sees as a robust market for Pennsylvania anthracite over the next decade or so.
“Anthracite is a grand old business, lasting about 200 years, but it had a really long down cycle,” says J. Gregory "Greg" Driscoll, Blaschak’s chairman. “With the infrastructure that’s now in place, we see a 2- to 3-million ton a year industry growing to maybe 5- to 10-million tons over the next 10 years.”
Driscoll’s optimism is not just idle talk.
Blaschak, which was founded during the Great Depression, recently reorganized under new ownership — a move Driscoll says will generate new capital for investment in a planned expansion of the business.
The move comes amid another sign of growing optimism about the future of the anthracite industry.
Reading, Blue Mountain & Northern Railroad recently announced changes in its corporate leadership to deal with what it termed “unprecedented growth” in its anthracite business.
Anthracite producers in Northeast Pennsylvania are making significant investments in their facilities, the railroad said in a July news release. Since almost all North American anthracite originates along its line, Reading & Northern is making investments to handle increased demand.
Eric Peters, vice president of transportation, has taken on the role of managing the Port Clinton-based railroad’s coal business.
With demand for Pennsylvania anthracite expected to reach double-digit levels in years to come, the railroad said, it has invested in more coal cars and resigned senior management to its coal business.
Reading & Northern’s 2,000 coal cars will handle more than 12,000 loads this year, the company reported.
War and steel
The renewed interest in anthracite is fueled by the war in Ukraine and modernization in the steel industry,
Russia’s invasion of Ukraine in February 2022 caused a seismic shift in international purchasing of anthracite, industry sources say.
“Sanctions against the sale of Russian coal in the western world changed the way people look at Pennsylvania anthracite,” Driscoll said. “Within months of Russia’s invasion of Ukraine, we had people coming to us looking for 4 million tons of new anthracite.”
Perhaps even more important is the growth of electric arc furnaces, which use anthracite, in the steel industry.
Electric arc furnaces are used in about 70 percent of American-made steel, Driscoll said, and they’re being used increasingly by steel makers around the world.
Compared to blast furnaces, once the predominant method of crafting steel, electric arc furnaces are more efficient, economical and environmentally sound, Driscoll said.
Blast furnaces used one ton of coal to produce one ton of steel, he said. By contrast, electric arc furnaces use 40 to 50 pounds of anthracite to produce a ton of steel.
Electric arc furnaces emit a ton of carbon dioxide per ton of steel, he said, compared with 2.5 tons emitted by blast furnaces.
"Electric arc furnaces are the most environmentally and commercially sound steel-making process in the world,” Driscoll said. “Since anthracite is the primary source of carbon, that benefits the Pennsylvania anthracite industry.”
Fired up about coal
Blaschak Anthracite was owned primarily by Milestone Partners, a Radnor-based private equity firm, for the past 15 years.
When Milestone decided to close out the equity fund of which Blaschak was a part, a group that included company management, board members and others purchased the business.
Dan Blaschak, a member of the company’s founding family who lives in the Lehigh Valley, is among the new investors, who trade as Saint Nicholas Investors Group, Driscoll said.
Walter, Anthony and John Blaschak, trading as Blaschak Brothers Coal Company, initially founded the business as a coal trucking company. They opened their first mine in 1942, and a breaker in 1955.
“This is a perfect investment for us,” Driscoll said. “Blaschak is a national leader in anthracite coal production, and a prime growing source of needed carbon for electric arc furnaces both here and abroad.”
Blaschak is looking to increase its production, currently about 350.000 tons a year, significantly in the coming decade.
Purchasing two new excavators last year, the company has already increased production, said Driscoll, who foresees continued expansion of its mining operations in the region.
“The economics are favorable and we can afford to reinvest,” he said. Driscoll said. “There’s plenty of coal in the ground, and we can continue to increase our production.”
