Consol Energy has said it expects to invest US$ 200 million in order to complete the new BMX coal mine by the middle of March 2014.
The announcement comes as the company also sets a US$ 1.5 billion capital-spending plan, which sees the company look to increase natural gas production.
Over the latter half of 2013, Consol sold five large coal mines to Murray Energy Corp., in a deal valued at US$ 3.5 billion – one of the largest transactions seen in the coal sector over recent years. The company has been restructuring to take advantage of the shale gas boom in the US and looks set to divert much of its investment in resource extraction away from coal and toward natural gas production instead.
The company expects to invest US$ 1.1 billion of its capital-spending plan into its gas operations.
US$ 200 million, however, has been set aside for the BMX coal mine, which lies adjacent to the company’s Bailey and Enlow Fork mines in southwestern Pennsylvania.
Once completed in March, the underground mine is expected to come online in April. The single-longwall mine is expected to produce about 5 million tpa of high-quality thermal coal.
“Due to the well capitalised nature of the company’s retained coal assets [following the sale of coal mines to Murray Energy], we anticipate that maintenance of production capital for the year will be held to under US$ 4.25/t on the 31 million t expected to be produced [across all coal assets] for the year,” Consol said in a statement.
The deal with Murray Energy saw the sale of the McElroy, Shoemaker, Robinson Run, Loveridge and Blacksville No.2 mines in West Virginia. Consol maintains ownership of the Bailey, Enlow Fork, Buchanan and Miller Creek coal mines, as well as the CNX terminal in Baltimore.
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/coal/22012014/consol_invests_in_bmx_coal_mine_434/