Texas has an appreciable quantity of low to medium grade bituminous coal and a large quantity of average to high grade lignite. Bituminous coal is found in north central Texas in Pennsylvanian rocks in Coleman, Eastland, Erath, Jack, McCulloch, Montague, Palo Pinto, Parker, Wise, Young, and other counties. Cannel coal is found in considerable quantities in Maverick and Webb counties. Coal deposits in the Trans-Pecos area of West Texas occur in Brewster, Hudspeth, and Presidio counties. Earlier mines at Thurber in Erath County, Bridgeport in Wise County, Newcastle in Young County, and Strawn in Palo Pinto County produced large tonnages and in 1950 continued small-scale production for local use. Lignite, a low-grade coal, is found in a broad band of Tertiary Eocene strata that extends across the Coastal Plain from the Rio Grande near Laredo in South Texas to the Arkansas and Louisiana borders of East Texas, and in a group of intervening counties including Panola, Harrison, Marion, Gregg, Rusk, and Shelby. The largest source and best grades of lignite occur in the Wilcox Group of strata north of the Colorado River in East and Central Texas. In the period from 1895 to 1943, Texas mines produced more than twenty-five million tons of coal. Sixty thousand tons of lignite was mined in Texas in 1947. Deposits have been found in Angelina, Atascosa, Bastrop, Fayette, Freestone, Grimes, Harrison, Henderson, Hopkins, Houston, Limestone, McMullen, Milam, Panola, Robertson, Rusk, Titus, Van Zandt, and Walker counties. A thorough survey on which to base an accurate estimate of Texas coal and lignite resources has never been made, but it is estimated that there are 60,000 square miles of lignite territory with a supply of probably twenty billion tons of commercially valuable lignite. The coal belt is spottier and more difficult to estimate, but it is believed that the deposits exceed eight billion tons.
Coal was a significant energy source in Texas before the development of oil and gas. Early Texas settlers undoubtedly mined both coal and lignite from numerous outcroppings across the state for use in their homes, stores, and blacksmith shops. Commercial mining, however, did not begin until the 1880s. Coal production, first listed at 125,000 tons for Texas in 1884, declined for the next three years but climbed significantly from 1889 to 1901, when it reached 1,107,953 tons. In the mid-1880s, discoveries in northwestern Erath County led to operations that made it a leading coal-producing area in the state. The Texas and Pacific Coal Company established a company town at Thurber, which survived until the 1930s. After a slight recession in the industry in 1902–3, production surpassed the 1901 total in 1904, and began a steady climb to reach an all-time peak in 1913 at 2,429,920 tons. Totals declined slightly between 1914 and 1916, but soared to near the 1913 peak again in 1917 as the United States became involved in World War I. In the 1920s the industry underwent a sharp recession as competition from petroleum and electricity hurt the entire bituminous-lignite industry. The Texas decline was not unique. A brief rise took place in 1927, followed by a steady decline until 1935, when production fell to a thirty-year low of 757,529 tons. Mining practically ceased after World War II, and production totaled only 18,169 tons in 1950. The industry received a tremendous boost in the 1950s, however, when the Aluminum Company of America began using char produced from lignite at a plant near Rockdale. Production figures were not released after 1953, but the ALCOA operation was expected to consume approximately 300,000 tons of lignite a year.
Several methods have been used for extracting coal and lignite, including the pillar and stall, longwall, and strip mining. Mining was usually done formerly by hand with primitive tools, although gasoline locomotives were sometimes used. Most mines were small, yielding between 10,000 and 50,000 tons per year, and the bulk of coal produced was used within the state. Though railroads were early purchasers, they found the quality poor and used it only sparingly. Lignite was burned in homes, converted to briquettes used in boilers to produce steam for generating power, and reduced to activated carbon, a substance used as a clarifying agent in the sugar-refining industry. By-products of coal and lignite, including gas, coal tar, and char, were also obtained.
In the 1970s bituminous coal production resumed in the state after a long hiatus. Construction began on surface mines in southern Coleman County and the Thurber area of Erath County to produce coal for use as fuel in the cement industry. Construction continued on a Texas Utilities Company generating plant in Freestone County to be fueled with lignite from Freestone and Limestone County amounting to five million tons a year. Milam County lignite mining by the Industrial Generating Company produced fuel for electric power generation, while Harrison County lignite mined by Atlas Chemical Industries was processed into activated carbon. In 1975 the four strip mines in Texas produced a total of 11,002,000 short tons of lignite, representing an increase of 43 percent over the previous year and 172 percent over 1972. Subsequent production continued to increase for the next several years. The Texas Utilities Generating Company operated the state's largest producer, the Big Brown mine in Freestone County, and the Monticello mine in Titus County, which together produced more than 80 percent of the total, and planned a pilot in situ project to test the potential for gasifying Texas lignites in deep-basin beds. The remainder of the year's production came from the ALCOA Sandow strip mine in Milam County and the ICI United States Darco strip mine in Harrison County. The entire production was used within the state. Mining of cannel coals in the Santo Tomás district of Webb County, used mostly for boiler fuel, ceased from 1939 till 1978, when a surface mine was opened to produce coal for use in the cement industry. Coals of the Santo Tomás district were also demonstrated to have high gas, oil, and sulfur content, a fact that suggested their possible use as a source of petrochemical products. Leasing for lignite and coal continued strong, but was slower than in previous years, a decline indicating that easily attainable acreage had already been acquired. Several new mines, however, including the Martin Lake strip mine near Beckville in Panola County, were under development.
In the 1980s exploration for lignite resources continued, and bituminous coal was mined in the Eagle Pass section of Maverick County in South Texas. In 1986 lignite production totaled 48,346,000 tons, principally for the production of steam-generated electricity. By the 1990s, Texas was the nation's sixth leading coal producing state. As much as 99 percent of the product was lignite. A Milam County mine supplied electric power for alumina reduction, a Harrison County strip mine produced lignite used to make activated carbon, and other mines in Atascosa, Bastrop, Freestone, Grimes, Harrison, Limestone, Rusk, Panola, Titus, and Hopkins counties produced lignite for municipal, domestic, and industrial needs. Lignite reserves were estimated at approximately 23 billion short tons, and economically recoverable reserves of strippable lignite were estimated at nine to eleven billion tons. Other lignite resources of the Texas Gulf Coastal Plain, occurring as deep-basin deposits, were comparable in magnitude to near-surface resources.