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C i t i n g d r o p s i n g l o b a l c o a l p r i c e s , A u s t r a l i a n - b a s e d A m b r e Energy is backing away from its involvement in two planned coal export terminals in Oregon and Washington, as well as its North American coal interests in the Powder River Basin. T h e c o m p a n y , w h i c h i s p l a n n i n g t o d i v e s t i t s i n t e r e s t s t o Colorado private equity firm Resource Capital Funds (RCF) in an $18 million deal, disclosed its plans in a recent regulatory filing with the Australian Securities and Investments Commission. "Since deferring an initial public offering of the company's shares on the Australian Securities Exchange planned for mid-2012, the company has struggled, in the face of a sharply deteriorating thermal coal market, to raise the capital required to fund the opera- tions, that is, the development of its U.S. port projects, the optimiza- tion of its U.S. coal mining assets and the implementation generally of its U.S. coal export strategy," officials said in the filing. "During that time, the only source of capital the company has been able to secure has been from its major shareholder, RCF. This is the case despite various attempts to raise equity and debt from third parties and, more recently, to raise cash by trying to sell individual assets...not required for the company's core busi- ness. All of these attempts have been unsuccessful." Ambre's planned Port of Morrow (Columbia River) project in Oregon was slated to ship as much as 8.8 million tons of coal to Asia annually from Boardman and Port Westward; however, the Oregon Department of State Lands denied a key permit to the project three months ago. A sister terminal project, Longview, is still awaiting necessary permit approvals before it can move forward. The producer, which expects final shareholder approval for the divestment deal in December, said its Decker mine (shown above) in Montana is also included in the RCF transaction, as are the Black Butte mine and Big Horn deposits in Wyoming. Its Utah subsidiary, Ambre Energy North America, will be transferred to RCF and remain a representative for the export projects. The company's leadership will remain in place. Alpha Saves 750 Jobs in West Virginia Alpha Natural Resources has confirmed that a Worker Adjustment and Retraining Notification Act (WARN) notice issued earlier this year has expired, allowing about 750 of its workers from eight of its operations that had been facing layoff to keep their jobs. As of December 8, the company said, Highland Mining's Superior, Reylas, Freeze Fork and Trace Fork surface mines in Logan n e w s 4 www.coalage.com December 2014 Ambre Energy to Divest Pacific Northwest Interests B R E A K I N G N E W S CONSOL to Spin Off Coal Pennsylvania-based producer CONSOL Energy, furthering its wish to grow its oil and gas E&P; focus, will be spinning off its thermal coal business into a newly formed master limited partnership (MLP) that it plans to take public and will also set up a new subsidiary for its met coal properties and facilities. CONSOL officials said that the thermal MLP's purpose will be to own interests in its mines and facilities in Pennsylvania including the Bailey, Enlow Fork and Harvey mines along with its related preparation plant. The company, which sold several Appalachian properties from the Consolidation Coal division in late 2013 to Murray Energy, is anticipating a mid-2015 initial public offering (IPO) for the MLP; post-IPO, it plans to own the partnership's general partner along with any incentive distribution rights and a majority of limited partner interests. Additionally, CONSOL's board, citing a wish to create a more profitable financial structure, has approved the separate establishment of a sub- sidiary entity to encompass its met coal properties and related property, with the aim of conducting an IPO of up to 20% of the subsidiary's equity in the second half of next year. The subsidiary's assets would include the Buchanan mine in Virginia and its related preparation plant as well as CONSOL's interest in the Western Allegheny Energy joint venture. Each business would have its own separate management team. Once complete, CONSOL will be mainly made up of: its core oil and gas exploration and production business; its interest in CONE Midstream Partners LP; a controlling interest in its cash flow generating thermal coal MLP; and a controlling interest in its metallurgical coal subsidiary.