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May 2017 www.coalage.com 11 news continued Steve Riley, Indiana's chief mine inspector, said Sunrise's Oak- town two-mine underground complex in Knox County, Indiana, recently purchased an unspecified amount of coal on the ground at Gold Star, currently owned by ERC Mining Corp. Riley said he has heard that Sunrise/Oaktown may be in- terested in "supplementing" their output because Gold Star/ Landree boasts some of the best steam coal in the Midwest- ern state. Oaktown is Sunrise's flagship operation, producing about 5 million tons of coal annually. "It's real good quality coal" at Gold Star/Landree, Riley said. "Low ceiling, high in BTU and low in ash." An ERC Mining official, who asked not to be identified, in- sisted in late April he was unaware of any plans to sell Gold Star/ Landree. Idled so far for all of 2017, the mine is expected to resume production by this summer, he claimed. The mine produced only 14,871 tons of coal in 2016 and 3,022 tons in 2015, according to the federal Mine Safety and Health Administration. A succession of owners during the past decade has attempt- ed, mostly without success, to develop a continuous mining op- eration at Gold Star/Landree. Part of the mine's problems have been geological. It has what is referred to as "bad top" and has been plagued by roof falls in the past. In addition, the mine is surrounded by mined-out under- ground works that can pose a safety risk if miners advance into old tunnels flooded with water. Referring to Gold Star/Landree, Bilsland would not comment on "what we may or may not be considering to purchase." Oaktown Nos. 1 and 2 are budgeted to produce almost all of Sunrise's coal in 2017. Hallador already has committed sales of about 6 million tons this year, and Bilsland is confident the com- pany will secure another 500,000 tons or so of sales in the remain- ing months of 2017. He said Carlisle, currently idled, will reopen on a reduced basis once Sunrise gets a sales contract for its coal. For much of the past decade, Carlisle was Sunrise's major producer, annually turning out in the range of 3 million to 3.3 million tons. During its extended idling, Carlisle's mine plan has been re- configured, with portions of the mine closed off and sealed. Hallador also operates the small Ace in the Hole surface mine in Clay County, Indiana. Ace produced about 81,000 tons in the first quarter of 2017 and approximately 335,000 tons in 2016. Its lower-sulfur coal is blended with Oaktown's higher-sulfur coal to meet the specifications of some Sunrise utility customers, partic- ularly in Florida. Construction to Begin This Summer on Poplar Grove Paringa Resources Ltd. is proceeding to the construction phase this summer for its proposed Poplar Grove underground steam coal mine in McLean County, Kentucky, after completing a finan- cial transaction to raise about $40 million for the 2.8 million-ton- per-year continuous miner operation that will be the Australian company's first mine in the United States. Over the coming weeks, Paringa plans to begin establishing electrical service to the approximately 318-acre Poplar Grove site near the navigable Green River in the small western Kentucky county. McLean County is mostly a stranger to coal mining, un- like its neighbor Muhlenberg County, which once was a leading coal producer in Kentucky. As a result of South32 not completing the acquisition of the mine, Peabody will retain the previously negotiated deposit. The termina- tion of the transaction has no effect on operations, and Metropolitan intends to fully resume shipments following scheduled completion of a longwall move to a new coal panel at the end of May. Peabody said it intends to update its 2017 targets including Metropolitan mine in its upcoming fi rst quarter 2017 earnings release. China to Further Consolidate Coal Operations China plans to create about 10 mega coal companies by 2020 through mergers and reorganizations, as part of its long-standing efforts to cut overcapacity, according to China Daily. The country is preparing guidelines to overhaul the sector and it hopes to cre- ate several new large coal companies with annual capacity of 100 million metric tons (mt) by 2020, explained Wang Xiaolin, deputy director of the National Energy Administration (NEA). Six Chinese producers have already attained that production level, said Zhang Hong, deputy secretary-general of the China Na- tional Coal Association. The plan is part of the government's effort to optimize coal pro- duction. Last year, it set a target of reducing the number of coal producers by almost half to 3,000, with mines that produce 50 million mt or more generating 60% of industry output. In addition to the 10 or so mega miners, China also set two- year objectives for regional development, Wang said. As the world's largest coal producer and consumer, China has been accelerating the pace of reducing its excess capacity. Anglo to Sell its Interest in Drayton in Australia Anglo American confi rmed it has entered into an agreement with Malabar Coal Ltd. to sell its 88.17% interest in the Drayton ther- mal coal mine and Drayton South project, located in New South Wales, Australia. "The agreement to sell the Drayton thermal coal mine marks further progress as we focus our global portfolio around our largest and most competitive assets," said Mark Cutifani, chief executive of Anglo American. Malabar Coal Ltd.'s primary focus up until now has been the development of its Spur Hill underground coking coal project in the upper Hunter Valley of New South Wales. The Drayton transaction remains subject to several conditions and its terms are confi den- tial. Anglo American ceased mining activities at the Drayton mine during 2016. Posco to Build Second Coal-fi red Power Plant in Vietnam South Korea's POSCO Group received approval to build its second coal-fi red power plant in Vietnam. The Quynh Lap 2 project, valued at more than $2.5 billion, will be built in the north-central Nghe An province, on a land area of 171 ha and 37 ha of water surface. Quynh Lap 2 will operate two units with a total capacity of 1,200 megawatts (MW). Construction is expected to begin in 2022 and the project should be completed in 2026. Construction of Quynh Lap 1 began in October 2015 with total investment of $2.2 billion and Vinacomin as the investor. It is expected to begin operations in 2020. 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