Obama vs. Coal

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With citizens of the Earth increasingly looking to minimize their carbon footprints, the widespread use of coal still has us leaving tracks that could pass for Sasquatch.

Burning the stuff is problematic enough, but in many cases the extraction process itself leaves a footprint that spans mountain valleys. In Appalachia, where surface mines can create dramatic alterations of the landscape in a process known as mountaintop removal, miners of the region's high-quality bituminous coal discovered this week that the Obama administration brings an entirely different regulatory approach from its predecessor.

Even under the Bush administration's famously friendly stance toward the extractive industries, miners began to report an uptick in permitting scrutiny last year. Scores of permits were further delayed by court proceedings that ultimately failed to compel the Army Corps of Engineers to revamp the permit-review process.

Setting a new tone for the Environmental Protection Agency, administrator Lisa Jackson directed the agency to review 150 to 200 permits for new or expanded surface mines. In letters to the Corps, she voiced particular concern with three proposals --  involving miners like Massey Energy (NYSE: MEE) and Patriot Coal (NYSE: PCX) -- over worries about water quality and the continuity of existing streams.

While I bemoan the environmental vagaries of coal, I continue to view select coal miners objectively as among the most promising investment vehicles within a torturous climate for stocks.

Aside from those named above, Fools might want to take a fresh look at Appalachian miners through this new lens and consider that International Coal Group (NYSE: ICO) and Alpha Natural Resources (NYSE: ANR) also produce substantial portions of production from surface mines.

With virtually all production from underground mines, conversely, CONSOL Energy (NYSE: CNX) appears poised to benefit from the higher prices for Appalachian coal which could result from ongoing permitting delays up on the surface. Although active within Appalachia, Arch Coal (NYSE: ACI) enjoys regional diversity with big operations out West that are about to become bigger still. With no exposure to Appalachia, Peabody Energy (NYSE: BTU) continues to top my list of favorites, with CONSOL Energy running a close second.

Further Foolishness:

• Patriot Coal's midnight ride.
• Massey was on the defensive last year.
• The case for coal in 2009.