Coal Age

MAY 2013

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news continued 31.9%; Bell County, 1.1 million tons, 26%; and Knox County, 565,000 tons, 45.5%. In addition to Union County, two other western Kentucky counties showed production increases last year—Hopkins County, 8.9 million tons, 1.8%; and Ohio County, 7.2 million tons, 30.5%. Muhlenberg County, another traditional coal producer in the west, checked in with 4.8 million tons, a 14.9% decrease. Midwest Generation Granted a Reprieve in Chicagoland Over the objections of environmentalists, Illinois regulators have given bankrupt Midwest Generation some breathing room to meet the state's pollution control rules at its coal-burning power plants in the Chicago area. The April decision by the Illinois Pollution Control Board means the Chicago-based subsidiary of Edison Mission Energy has until 2015 and 2016 to comply with restrictions on sulfur-dioxide emissions at its Waukegan, Joliet and Will County plants, an approximately two-year reprieve. Public comments on the proposed variance were mixed. The CALENDAR OF EVENTS June 11-13, 2013 Longwall USA Exhibition & Conference—will be held at the David L. Lawerence Convention Center in Pittsburgh, Pa. Contact: Tanna Holzer (Tel: 303283-0640; Email: tholzer@mining-media.com; Web: www.mining-media.com). June 23-25, 2013 2013 RMCMI Annual Meeting—will be held at the Steamboat Sheraton Resort in Steamboat Springs, Colo. Contact: The Rocky Mountain Coal Mining Institute (Tel: 303-948-3300; Fax: 303-954-9004; Web: www.rmcmi.org). July 23-26, 2013 Mpumalanga Minex 2013—will be held in Middelburg, South Africa. Contact: Jurie Smit, Minex Management (Tel: 27 79 467 0738; Fax: 27 86 719 4581; Email: minex2013@minex.co.za; Web: www.mminex.co.za). July 30-August 1, 2013 32nd International Conference on Ground Control in Mining— will be held at the Lakeview Golf Resort and Spa in Morgantown, W.Va. Contact: Karen Centofanti (Tel: 304-293-3901; Fax: 304-293-5708; Email: KLcentofanti@mail.wvu.edu; Web: www.mine.cemr.wvu.edu). August 11-15, 2013 23rd World Mining Congress—will be held in Montréal, Québec, Canada. Contact: Canadian Institute of Mining, Metallurgy and Petroleum (Tel: 514.939.2710; Web: www.wmc-expo2013.org or www.cim.org). August 20-23, 2013 AIMEX—will be held at the Sydney Showground, Sydney Olympic Park, Australia. Contact: Reed Mining Events, Reed Exhibitions Australia (Tel: 61 2 9211 7544; Email: aimex@reedexhibitions.com.au; Web: www.aimex.com.au). September 4-6, 2013 Fall Blasting & Explosives Safety Training Seminar—will be held at the South Dakota School of Mines, Rapid City, S.D., and the Crazy Horse Memorial. Contact: RAM, Inc.-Robert A. McClure, Inc. (Email: info@ramets.com; Web: www.ramets.com). September 11-13 2013 Bluefield Coal Show—will be held at the Brushfork ArmoryCivic Center in Bluefield, W.Va. Contact: The Greater Bluefield Chamber of Commerce (Tel: 304-327-7184; Fax: 304-325-3085; Email: info@bluefieldchamber.com; Web: www.bluefieldchamber.com). September 16-20, 2013 XV International Congress for Mine Surveying—will be held in Aachen, Germany. Contact: RWTH Aachen, Institute for Mine Surveying (Tel: 49 241 80 95687; Fax: 49 241 80 92150; Web: www.ism-germany-2013.de). September 21-24, 2013 2013 National Association of Abandoned Mine Land Programs Conference—will be held at the Resort at Glade Springs in Daniels, W.Va. Contact: WV DEP/AML&R; (Email: Barbara.E.Mays@wv.gov; Web: www.naamlp2013.com). 18 www.coalage.com board said it received 4,221 comments in favor of the extension and 4,326 comments in opposition. The move buys time for Midwest Generation, which, along with EME, filed for Chapter 11 bankruptcy reorganization last December in the U.S. District Court for the Northern District of Illinois, to figure out a long-term solution for the plants while it keeps them in operation. "The key to the variance was a slight revision to sulfur-dioxide emission rate limits in 2015-16 that would enable us to defer some $200 million of capital expense out of 2013-14, which is the critical period for cash conservation as we undergo our financial restructuring," said Midwest Generation President Doug McFarlan. McFarlan said his company took pains to make the board understand that the variance alone does not address all of the company's financial challenges. "But it does give us the best-possible opportunity to develop a path for maintaining a viable coal fleet," he said. The company still needs to make "unit-by-unit decisions on retrofit versus retirement, but the variance gives us additional flexibility to factor into our decision-making," McFarlan said. Midwest Generation retired its two aging coal plants in the city of Chicago, Crawford and Fisk, last fall, sooner than planned under a deal brokered by Chicago Mayor Rahm Emanuel. In asking for more time to meet the rules, Midwest Generation, a merchant power generator that sells its electricity on the wholesale market, told the board it faces significant cash flow losses due to "unexpected and significantly declining energy prices." The company had a net income of $85 million during the first three quarters of 2011, but a net loss of $63 million for the same period of 2012. Midwest said its financial condition "has been exacerbated" by 60% higher costs for low-sulfur Powder River Basin coal than in 2008 and the debt of EME. Midwest Generation said its remaining coal plants—Powerton, in addition to Waukegan, Joliet and Will County, could find themselves under new ownership before the bankruptcy process is completed. Together, they generate about 4,300 mw of electricity. Midwest Generation has signed deals to buy 11.8 million tons of PRB coal for the plants this year. Midwest Generation purchased six coal plants from Commonwealth Edison, also headquartered in Chicago, for $4.9 billion in late 1999. IURC Rules in Favor of Vectren The Indiana Utility Regulatory Commission ruled in late April that Vectren Corp. did nothing wrong in canceling a coal sales agreement with Christopher Cline's Foresight Energy Partners for failing to meet specifications for ash content. When Vectren, an Evansville-based electricity and natural gas company that also owns coal mines in southern Indiana, concluded Foresight's high-sulfur Illinois Basin coal did not meet its coal quality standards, it notified the coal company on November 27, 2012, it was suspending their agreement that took effect October 31, 2011. Vectren purchased about 250,000 tons from Foresight in 2012 for the utility's 490-mw A.B. Brown power plant near West Franklin in Posey County, Ind., along the Ohio River about 10 miles west of Evansville. Indiana's consumer watchdog, the Office of Utility Consumer Counselor, had expressed concern about the contract termination, which affected Vectren South, Vectren's electric utility subsidiary that serves about 140,000 customers in southwestern Indiana. OUCC Senior Utility Analyst Michael Eckert said the May 2013

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