Coal Age Magazine - For more than 100 years, Coal Age has been the magazine that readers can trust for guidance and insight on this important industry.
Issue link: https://coal.epubxp.com/i/640014
The coal business finished weak in 2015 and its off to a slow start in 2016, and the information contained in Coal Age's annu- al U.S. Longwall Census reflects a market in turmoil. Similar to overall U.S. coal production, total longwall production saw a double digit decrease. Collectively, U.S. longwall instal- lations produced nearly 182 million tons in 2015, a 12.3% decrease over 2014. The four top-producing longwall complexes operate two faces each, and three of them produced more than 10 million tons. Last year, 17 longwall installations produced at a capaci- ty of 5 million tons per year (tpy) or more, compared to 20 in 2014. This year, one longwall face was removed and the ownership of 15 faces changed hands. Alpha Natural Resources is no longer operating a longwall face at the Emerald mine in Pennsylvania and it was removed. Year-on-year, the total number of longwall mines dropped to 40 from 41. Similarly, the number of longwall faces dropped to 45 from 46. Five mines operate two longwall faces. Change Is the Only Constant Last year, Murray Energy Corp. (MEC) sup- planted CONSOL Energy as America's long- wall leader from a production standpoint. Foresight Energy's Sugar Camp mine and MEC's Marshall County mine posted total production figures of more than 10.5 mil- lion tons and nearly 10.3 million tons, respectively. The new Nos. 1 and 2 longwall mines displaced CONSOL Energy's Bailey and Enlow Fork mines, which have held those positions since 1992. Two years ago, MEC eclipsed CONSOL Energy on an ownership basis when the company purchased six of its West Virginia longwalls. In 2015, MEC purchased a con- trolling interest in Foresight Energy, adding four more longwalls to its portfolio and bringing its total to 14 longwalls. Despite some payroll reductions, much of MEC is operating as it has been. UtahAmerican Energy's West Ridge mine ceased opera- tions in 2015 as it had reached the end of its reserve life. The group is now operating the Lila Canyon longwall mine in Utah. Two of three Foresight Energy longwall mines in Illinois (Sugar Camp and Mach Mining) resumed production in early 2016 following a lengthy Christmas holiday break. The company's Deer Run longwall mine remains idled indefinitely, however, because of a stubborn carbon monoxide problem that has dogged the mine since March 2015. While MEC's acquisition of the Foresight Energy mines was a big deal, it wasn't the only deal in 2015. ERP Compliant Fuels has emerged as a new U.S. longwall operator. The company, which is affiliated with the Virginia Conservation Legacy Foundation (VCLF), acquired the American Eagle and the Federal No. 2 longwall mines in West Virginia from Patriot Coal through a bankruptcy sale at the end of October. ERP is actively marketing the sale of compliant fuel, which bundles refor- estation carbon credits with coal sales to reduce the rate of growth in atmospheric car- bon dioxide. Their goal is to rebalance the domestic supply through the purchase, reclamation and retirement of 135 mining permits in five states. In December, Cliffs Natural Resources agreed to sell its two longwall mines, the Pinnacle mine in West Virginia and Oak Grove mine Alabama, to Seneca Coal, an affiliate of ERP Compliant Fuels. At the time, the company said Seneca planned to pro- duce 4.4 million tons of metallurgical coal in 2016 and employ 811 people in West Virginia and Alabama. As this edition was going to press, Walter Energy announced it was selling its remain- ing assets to Seminole Coal Resources, an affiliate of ERP (see Breaking News, p. 4). Walter Energy, formerly Jim Walter Resources, operates the Blue Creek long- wall mines in Alabama. They produce met- 18 www.coalage.com February 2016 u . s . l o n g w a l l c e n s u s U.S. Longwall Operators Scale Back Production B Y S T E V E F I S C O R , E D I T O R - I N - C H I E F Ownership changes hands as new longwall operators emerge Table 1—Longwall Installations by Parent Company (2015-2016) C ompany Ala. Colo. Ill. Mont. N.M. Ohio Pa. Utah Va. W.Va. Wyo. Total A lliance Resource Partners 1 2 3 AmCoal (MEC) 2 2 American Energy (MEC) 1 1 A rch Coal 1 2 3 B lue Mountain Energy 1 1 B owie Resource Partners 2 2 4 CONSOL Energy 5 1 6 Drummond 1 1 E RP Compliant Fuels 2 2 F oresight Energy (MEC) 4 4 Murray American Energy (MEC) 6 6 Ohio Valley Coal (MEC) 1 1 Pacific Minerals 1 1 Seminole Coal Resources (ERP) 3 3 Seneca Coal Resources(ERP) 1 1 2 Signal Peak Energy 1 1 Solvay Chemicals 1 1 Tronox Alkali Co. 1 1 UtahAmerican Energy (MEC) 1 1 Westmoreland Coal 1 1 Total 5 4 7 1 1 2 5 3 1 13 3 45