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/695160
8 www.coalage.com June 2016 news continued County, Kentucky, and the Survant and Kronos deep mines in Ohio and Muhlenberg counties, respectively. In response to a question, Wilson said Armstrong is contracted to produce about 5.6 million tons in 2016, down more than 20% from 7.7 million tons in 2015. "It will take well into 2017 to get the supply and demand more in line, so I would be extremely cau- tious about saying we'll sell more than what we're committed for in 2016," he said. Next year most likely will be another challenging year for the domestic coal industry, Wilson said, as Armstrong is starting to see solicitations aimed at locking in lower-priced tons for next year. "I think people's margins — I can't say this for the entire in- dustry — will be down for the majority of producers in 2016 and 2017." For 2017, Armstrong so far has 4.3 million tons of coal con- tracted at an average price in the low $40s/ton, he said. Wilson said the company may have a further 2017 sales update during its second-quarter earnings conference later this summer. Mine Foreman Pleads Guilty in Death Case A former mine foreman in Bell County, Kentucky, has pleaded guilty to violating federal mine safety regulations that contributed to an October 2014 worker death. According to the Associated Press, Anthony Tyler Cornett entered his plea June 1, and now faces up to one year in prison, a $250,000 fine and the permanent forfeiture of his foreman certification. Cornett was a foreman at Common- wealth Mining's Tinsley Branch 61 highwall mine near Pikeville on October 7, 2014, when he allowed miner Justin Mize to enter a non-supported auger hole. After another miner refused the task, nine-year mining veteran Mize was sent in to examine a cutter head chain that had fallen off. A roof rock slab measuring 8 feet wide, 6 ft long and 16 inches thick fell and crushed the 31-year-old miner. Federal investigators said in a final report of the incident that there were several more cutter head chains at the operation at the time, so retrieving the slipped one was not necessary. The Mine Safety and Health Administration had not given permission to enter as re- quired. Cornett is scheduled to be sentenced in August. Foresight Reaches Debt Restructuring Deal For the second time, Illinois Basin-focused producer Foresight Energy has come to an agreement with its bondholders to restruc- ture more than $600 million in debt. The St. Louis company en- tered a regulatory filing on May 23 to the effect, noting that the deal is contingent upon a larger restructuring plan with its smaller credit holders, according to the St. Louis Business Journal. It called negotiations "global restructuring" in the filing, and said they are ongoing and not yet finalized. In all, the company has been able to retool $1.25 billion in debt; it reached a deal in April with secured lenders totaling $650 million. On May 20, Fore- sight announced an agreement with certain lenders to extend the terms of a forbearance agreement dated December 18, 2015, through July 15. The deals follow a March warning by the compa- ny that it may have to file bankruptcy if a bondholder deal for $600 million in debt could not be negotiated. Foresight is controlled by Cline Group founder Chris Cline. Hallador CEO Expects Gas Prices to Rise While he may not have a crystal ball, Hallador Energy Co. Presi- dent and CEO Brent Bilsland sees a rising U.S. steam coal market required to mine them," the company said. "A number of options to continue operations were examined, including the proposed Tahmoor South and Tahmoor North projects, but current market conditions do not support these projects." Glencore said support services are being put into place to assist its workforce; 350 impacted employees will be gradually reduced over 18 months while development work at Tahmoor is completed. The metallur- gical operation frst started production in 1979. It produced 2.1 million metric tons (mt) in 2015. India's NTPC Temporarily Halts Coal Imports India's largest government owned and operated power producer, NTPC Ltd., has decided to stop imports of coal during the current fscal, in view of higher domestic availability and its own production from captive mines. Coal India Ltd. (CIL), with rising production and mounting stocks, has as- sured the thermal power producer of meeting entire contracted volumes of coal prompting NTPC Ltd. to scrap plans for importing the dry fuel. According to an NTPC offcial, only marginal volumes already contracted for imports during the previous fscal would be shipped in but no import contracts would be signed this year. During 2015-2016, the power utility had initially planned for coal imports of 21 million tons, which over the course of the year was reduced to 16 million tons, but actual shipments were far lower at 10 million tons, in response to higher dispatches from CIL, the off- cial said. While a halt in imports has been declared for the current fscal, it was a distinct possibility that the same would be extended for the next few years as captive coal blocks allocated to NTPC were progressively brought into production over the next few years, the offcial said. For one, the captive coal block of Pakri Barwadhi in eastern province of Jharkhand had already been handed over to mine developer operator (MDO), Thriveni-Sainik, and was scheduled for commercial production by the end of 2016. The block was expect- ed to provide assured supplies of 15 million tpy for thermal power plants of NTPC. The latter was also in the process of appointing a MDO for the Kerandari coal block also in Jharkhand province. This coal block scheduled for be brought into production over the next two years would offer an additional coal supply of about 6 million tpy to the power utility. It was pointed out that another trigger point for calling a halt to im- ports was CIL's decision to offer higher volumes for sales through e-auction during the period August 2016-March 2017, including forward auction to enable large coal consumers to plan their feedstock requirements and sourcing over a longer period. CIL has already committed to offer 79 million tons of coal during the period for both power and non-power consumers. Of the total offering, 63 million tons had been earmarked for power sec- tor consumers through special forward e-auction and 19 million tons to non-power sector through e-auctions. Solar Power Eclipses Coal-fred Power in the UK Solar power in the U.K. produced more electricity than coal across the whole of May, according to The Guardian, the frst ever month to pass the milestone, according to research by analysts at Carbon Brief. Solar panels generated 50% more electricity than the fossil fuel across the month, as days lengthened and coal use fell. Solar generated an estimated 1,336 gigawatt hours (GWh) of electricity in May, compared to 893 GWh output from coal. Solar surpassed coal over a whole day for the frst time on April 9, while the electricity produced by coal fell to zero several times in early May, thought to be the frst time this had happened since the late 19 th century. The Continued from p. 7... Continued on p. 10...