Murray Energy acquires coal reserves from Consol Energy
Murray Energy Corp. has acquired roughly 91 Mt (100 million st) of coal reserves in Hamilton and Saline counties in Illinois from Consol Energy Inc., Murray announced.
"This acquisition is a significant investment in [Murray subsidiary] The American Coal Company and our continuing operations in the Illinois Basin," said CEO Bob Murray in a statement.
The coal and other property being sold in the most recent transaction is part of the Herrin No. 6 Coal Seam, which are located adjacent to The American Coal Company's New Era Mine.
Even though market conditions and regulations have hurt coal production, particularly in Appalachia, the Illinois Basin has seen growth because technology has allowed power plants to use the region's high-sulfur coal, West Virginia's The State Journal reported.
The deal means not only Murray's growth and an extended life span for its New Era Mine in Illinois, but also Consol shedding more of its coal business. The company did not release the terms of the transaction.
Last year, privately held Murray bought from Consol five West Virginia coal mines, river and dock operations, plus significant amounts of coal reserves, in a $3.5 billion deal.
The situation for the coal industry remains precarious. Arch Coal Inc. recently announced a third-quarter net loss of $97 million. Peabody Energy Corp. lost $154 million during that time. Consol, which has significant natural gas operations, announced third-quarter net income of $20 million.