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MISSOULA- Montana's economy would see a big boost in jobs, household income and tax revenues from construction of the Otter Creek Coal mine in southeastern Montana.

That's the conclusion of a new study from the University of Montana Bureau of Business and Economic Research that looks at the impact of the rising demand for coal in Asia, and the subsequent construction of the Otter Creek Coal mine proposed by Arch Coal.

UM economists say the impact from that proposed mine could mean a $1 billion shot in the arm for the state's economy.

The U-M study says during the permitting and construction phase of the Otter Creek Mine, new rail development and related infrastructure - more than 2,600 construction jobs would be created at its peak.

Most of those jobs would be in eastern Montana and impacts on new personal income for Montana households during peak construction could generate as much as $103.5 million.

During its operation phase, UM economists say Otter Creek would generate 1,740 new permanent year-round jobs, resulting in an increase in household income by $125.4 million. The new mine would also add 2,850 people to the state's population - as well as 560 school-aged students, while state and local tax revenue would increase by almost $92 million per year.

Key to the study is China's increasing demand for coal. Economist Patrick Barkey, who co-authored the study, says Montana has a geographic advantage over Wyoming coal in serving the fast-growing Asian markets.

"The anticipated increase in coal demand in China between 2010 and 2035 is more than twice the current U.S. production of coal," said Barkey. "Southeast Asia does not have sufficient capacity to satifsy this growth," explained Barkey.

"Because Montana coal fields are closer to Northwest ports than those in Wyoming, Montana has a geographic advantage in serving fast-growing Asian markets," Barkey said.

The Bureau of Business and Economic Research at UM is a research center producing economic and industry data for Montana. For more information go online.