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12 www.coalage.com September 2018 news continued er consumption at Schahfer and increases in cycle times to that station . . ." According to Wagner, rail carrier performance by one of the Merrillville-based utility's rail carriers "has fallen off. Cycle times — the time it takes for a unit train to make a round trip — for Nip- sco have increased, and Nipsco is working closely with that rail- road to improve both railroad performance and station unload- ing performance." The railroad in question was not identified. While Nipsco did not have any surplus rail capacity at the end of June, any idle train units are typically stored at Schah- fer, located at Wheatfield, Indiana, or at the now-retired Bailly generation station on the shores of Lake Michigan before trains are stored at third-party locations, Wagner said. "This practice has minimized the cost of storage," he said. "Storage costs are one of the many factors considered when determining the size of the unit train fleet." Wagner added that one key consideration is the cost of unit train capacity. Specifically, the market for railcars is extremely soft, he noted, "and this has driven the cost to carry surplus capacity down substantially." In the current market, Wagner said, the reliability afford- ed by surplus capacity "far outweighs the cost of capacity. In addition, modest surplus capacity protects against unforeseen changes in consumption and cycle times." These dynamics, he concluded, "drove 100% unit train uti- lization" by the end of June "and surplus capacity allowed Nip- sco to ship additional tonnage." Nipsco buys low-sulfur Powder River Basin coal from Arch Coal Sales Co. and Peabody CoalSales LLC, Northern Appa- lachian coal from Consol Pennsylvania Coal Co. LLC, and high-sulfur Illinois Basin coal from Alliance Resource Partners. During the second quarter, the utility also purchased an unspecified amount of spot NAPP coal from Ohio-based Mur- ray Energy Corp. through April 2019. Typically, Nipsco burns almost 7 million tons of coal annually. Alliance Reports Increased Coal Sales and Exports Alliance Resource Partners said strong second quarter coal sales volumes led total revenues higher to $516.1 million, an increase of 29.4% compared to the second quarter of 2017. Alliance is now essentially sold out for its planned 2018 sales volumes and has increased its anticipated export sales for this year to approximately 11.1 million tons. "Coal sales volumes increased significantly as we shipped substantially all of the 1.4 million tons impacted by weath- er-related transportation disruptions during the Sequential Quarter," said Joe Craft, president and CEO, Alliance. "U.S. coal market conditions remained favorable allowing us to secure new commitments for approximately 8.9 million tons to be de- livered to domestic customers through 2021. "We also continued to strengthen our international coal sales position, booking an additional 4.6 million tons for delivery to the export markets over the next 12 to 18 months. Our operations have also performed well, increasing production volumes to meet additional demand while continuing to control per ton costs." In response to growing international thermal coal demand, Alliance brought the first continuous mining unit back into operation at its Gibson North mine during the second quarter and they currently anticipate the second unit will commence production by the fourth quarter of this year. Coal sales volumes were 10.5 million tons, 23.9% higher than the second quarter of 2017, primarily reflecting fulfill- ments of shipments delayed during the first quarter due to weather-related transportation disruptions, as well as in- creased export volumes. Production volumes increased 2.6% year-on-year to 9.7 million tons, primarily due to increased production at the Gibson South and River View mines and the resumption of operations at our Gibson North mine. Warrior Met Coal Sees Net Income Decrease for Q2 2018 Compared to Q2 2017 Warrior Met Coal reported second-quarter 2018 net income of $91.3 million, or $1.72 per diluted share, compared to sec- ond-quarter 2017 net income of $129.9 million, or $2.46 per di- luted share. The company reported adjusted EBITDA of $128.8 million for the second quarter 2018 compared to adjusted EBITDA of $188.5 million for the second quarter of 2017. Year-to-date, Warrior reported net income of $270 million, or $5.10 per diluted share, compared to net income of $238.2 million, or $4.52 per diluted share, in the same period of 2017. Year-to-date Adjusted EBITDA was $345.3 million compared to $323.9 million in the same period of 2017. "The market for high-quality premium met coal continued to be robust in the second quarter, though moderated some- what from the exceptional strength we have seen over the past year," said Walt Scheller, CEO of Warrior. "Given the strength of our financial and operating results in the first and second quarters, performance at our mines, ongoing global GDP growth, and strong demand for steel production, we are raising our guidance for the balance of the year. "Warrior's performance clearly demonstrates the unique value of our highly focused business strategy as a premium 'pure-play' met coal producer." c a l e n d a r o f e v e n t s October 14-16, 2018: The World Coal Leaders Network 2018, Pullman Barcelona Skipper, Barcelona, Spain. Contact: Web: www.coaltrans.com/ world-coal-conference/details.html. November 6-8, 2018: MetCoke World Summit 2018, Pittsburgh, Penn- sylvania. Contact: Web: www.metcokemarkets.com/metcoke-summit. Janaury 27-30, 2019: 45 th Annual Conference on Explosives and Blasting Techniques, Nashville, Tennessee. Contact: Web: www.isee.org. February 24-27, 2019: SME Annual Conference & Expo, Denver, Colorado. Contact: Web: www.smeannualconference.com. March 10-13, 2019: Haulage & Loading, Hilton El Conquistador Resort, Tucson, Arizona. Contact: Web: www.haulageandloading.com. April 8-14, 2019: bauma, Messe Muenchen, Munich, Germany. Contact: Web: www.bauma.de. May 20-22, 2019: Longwall USA, David L. Lawrence Convention Center, Pittsburgh, Pennsylvania. Contact: Web: www.longwallusa.com.