ADVANCED RESOURCES INTERNATIONAL, INC. 

4501 Fairfax Dr, Suite 910, Arlington, Virginia 22203 Phone: (703) 528-8420 Fax: (703) 528-0439

Memorandum

To: Melissa Weitz; U.S. Environmental Protection Agency 

From: Michael Godec; Advanced Resources International, Inc. 

Date: 6/10/2010 

Re: Justification for the Changes in Cost Estimates for Compliance with Subpart FF 

Associated with Underground Coal Mines 

This memo is intended to communicate the rationale for the changes in the costs 

estimates for Subpart FF of the Mandatory Reporting of Greenhouse Gases Rule for 

Underground Coal Mines. 

In the proposed Mandatory Reporting of Greenhouse Gases Rule, compliance 

costs for underground coal mines were estimated to be $2.7 million nationwide in the 

first year, and $2.6 million annualized in subsequent years, averaging about $23,000 

per mine. EPA received numerous comments on the selected monitoring requirements, 

and its cost estimates. In response to those comments, EPA reviewed, and later 

revised, its monitoring requirements, cost analysis, and estimates. In the final rule, the 

estimated costs for underground coal mines is $3.7 million nationwide in the first year, 

and $2.6 million annualized in subsequent years. Estimated per mine costs are $32,517 

per affected mine in the first year, and $22,765 per mine annualized in subsequent 

years. 

The original proposal requirements for reporting emissions from underground 

coal mines are summarized in Table 1. 
June 10, 2010 

Table 1. Summary of Original Proposed Monitoring and Reporting Requirements for 

Underground Coal Mines

Component Monitoring Requirement 

Ventilation Systems 

Annual reporting of CH4 liberation from ventilation 

systems based on quarterly sampling 

Degasification Systems 

Annual reporting of CH4 liberation degasification systems 

at coal mines – using continuous wellbore monitors 

Destruction Devices 

Annual reporting of CH4 destroyed in destruction devices 

– using continuous wellbore monitors 

In response to the original proposed rule, a number of commenters felt that EPA 

did not appropriately take into consideration the full costs of compliance associated with 

the proposed rule, particularly those associated with the installation of CEMS on all 

degasification wells and gob gas vent holes. They noted that both the number of 

impacted wells and vent holes, as well as the costs associated with implementing such 

systems, were probably underestimated. 

Based on these comments, we reevaluated our cost assessment, and came to 

the conclusion that the costs were underestimated. In particular, we considered new 

information to provide a basis for estimating the number of degasification wells, gob gas 

vent holes, and other methane drainage wells that would likely be associated with 

underground coal mines required to report under the rule. This resulted in a 

substantially larger estimate of the number of degasification wells that would be 

required to install CEMS systems in compliance with the originally proposed 

requirements, with an associated greater incremental cost burden. 

The current requirements for reporting emissions from underground coal mines 

are summarized in Table 2. 
June 10, 2010 

Table 2. Summary of Current Monitoring and Reporting Requirements for Underground 

Coal Mines

Component Monitoring Requirement 

Ventilation Systems 

Annual reporting of quarterly CH4 liberation from 

ventilation systems using either quarterly or more frequent 

sampling of CH4 content and gas flow, or continuous 

emissions monitoring systems (CEMS). 

Degasification Systems 

Annual reporting of quarterly CH4 liberation degasification 

systems at coal mines – using either weekly sampling, or 

CEMS. 

Destruction Devices 

Annual reporting of quarterly CH4 destroyed in destruction 

devices – using continuous wellbore monitors. 

In EPA’s original proposal, it was estimated that there were 40 longwall mines in 

the U.S. that do not monitor remote gob gas vent wells/holes that are being used to 

degasify longwall mines prior to mining. These longwall mines would be required to 

monitor degasified gas volumes by installing continuous monitoring equipment on these 

remote gob gas vent holes. For purposes of developing costs, 5 gob wells were 

assumed per longwall panel. This resulted in an estimated 200 gob gas vent holes 

where the degassed CH4 was vented. 

In addition, the number of mines with mine degasification systems was also 

determined based on data collected by MSHA and EPA. Based on this data, it was 

estimated that in 2006, twenty U.S. coal mines supplemented their ventilation systems 

with active degasification systems where the gas was either sold or used on site. 

However, it was assumed that all of these degasification systems had CEMS already in 

place, and would therefore incur no incremental costs as part of this rulemaking. 

Specifically, for cost estimation purposes, the revised estimate of the number of 

these degasification wells in the U.S. was developed based on the following: 

• As part of developing the EPA greenhouse gas emissions inventory1 for the coal 

mining sector, for some mines, well-by-well data are compiled. This includes 

 

1 Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2006, 

USEPA #430-R-08-005, April 2008 (http://www.epa.gov/climatechange/emissions/usinventoryreport.html) 
June 10, 2010 

most of the mines in Alabama, and a few elsewhere. Where available, well 

counts based on these data were used. 

• For mines where well count information was available, these counts were used, 

in combination with estimated gas volumes recovered from the degasification 

systems associated with these wells, to develop estimated average state-specific 

annual production rates and typical well lives for these degasification wells. In 

some cases, these data were supplemented with degasification well recovery 

rates reported in the literature. 

• For states with known degasification projects, estimates are developed by EPA 

of the volume of methane recovered from degasification systems that is sold, 

used on site, or otherwise destroyed; as well as that drained but not sold, used 

on site, or otherwise destroyed.2 Where estimates of well counts were not 

available for a particular mine known to have a degasification project in place, the 

estimated number of active degasification wells was estimated by dividing the 

estimate of methane emissions recovered by the estimated state-specific 

average production rate per degasification well. The degasification wells were 

allocated to individual mines according to the estimated volumes vented versus 

that sold, used on site, or destroyed. 

• Where estimates of degasification well counts were not available for a particular 

mine known to produce some amount of methane that is not recovered by an 

existing degasification project, as well as all other longwall mines, the estimated 

number of active degasification wells where gas is currently vented was 

estimated by assuming that 40% of the methane vented was the result of 

degasification. This estimate of total fugitive methane emissions at the mine was 

then divided by the estimated average state-specific production rate per 

degasification well. 

 

2 Environmental Protection Agency, Identifying Opportunities for Methane Recovery at U.S. Coal Mines: 

Profiles of Selected Gassy Underground Coal Mines: 2002-2006, EPA 430-K-04-003, September 2008 

(Revised January 2009) 
June 10, 2010 

Based on this approach, it was estimated that about 1,400 degasification wells 

were associated with 15 mines with degasification systems where the recovered 

methane is sold, used on site, or otherwise destroyed. For cost estimation purposes, it 

was assumed that these wells had an average 5 year life, resulting in an average of 280 

new wells that are brought on line each year (as a comparable number are retired). 

Similarly, it was estimated that 500 degasification wells were venting methane to 

the atmosphere from 21 mines. For cost estimation purposes, it was assumed that 

these wells had an average 3 year life, resulting in an average of 167 new wells that are 

brought on line each year (as a comparable number are retired). 

Second, we reassessed the costs associated with installing and operating CEMS 

on degasification wells where CEMS were not already present. Based on comments 

obtained through interviews with individuals familiar with existing degasification 

systems3, it was concluded that, in many cases, it would be difficult and very costly to 

install CEMS on some gob gas vent holes because of their remote location, 

unavailability of power, inaccessibility, susceptibility to vandalism, and the relatively 

short longevity of many of these gob gas vent holes. 

We also reassessed and updated the estimated number of labor hours that may 

be required to comply with some of the elements of the proposed rule, based on the 

changes proposed for the final rule. Specifically, these changes are: 

• An option of using one or more CEMS to obtain data on mine ventilation systems 

is added. 

• For CH4 liberated from degasification systems, the requirement to monitor each 

well was removed. Now CEMS may be used to monitor aggregate CH4 from 

more than one well, as long as CH4 from all wells is monitored, and the 

methodology for estimating total emissions from all wells is documented. 

 

3

 Interviews were conducted with S. J. Schatzel, Pittsburgh Research Laboratory, National Institute for 

Occupational Safety and Health (NIOSH) (April 25, 2008); Jeff Schwoebel, Director, REI Drilling 

(December 17, 2009, and Michael Coté, President and Environmental Engineer, Ruby Canyon 

Engineering (November 10, 2009), and Jonathan Kelafant, Senior Vice President, Advanced Resources 

International (November 9, 2009). 
June 10, 2010 

• The requirement for continuous monitoring for total CH4 liberation at 

degasification systems was removed. Degasification wells may be monitored with 

CEMS or through weekly sampling of all degasification wells, including gob gas 

vent holes and other degasification wells. 

Finally, in the process of updating the cost estimates for the revised proposal, we 

also updated cost data for methane (CH4) sampling and monitoring equipment, along 

with other costs, for both degasification and ventilation systems., based on more up-todate cost quotes obtained from a variety of sources of equipment sales catalogs 

accessed from numerous web sites. 

The details associated with these changes in estimated costs can be found in the 

updated Regulatory Impact Assessment Cost Appendix for fugitive methane emissions 

for underground coal mines (in docket EPA-OAR-2008-0508). 

Based on this update, the total estimated annualized costs for complying with 

these requirements for underground coal mines are $3.7 million in the first year of 

compliance, and nearly $2.6 million in subsequent years. The basis and breakdown of 

these costs are summarized in Table 3. 

Table 3. Basis for Determining Nationwide Cost for Current Monitoring 

Options