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8 www.coalage.com May 2017 news continued IP&L;, a subsidiary of Arlington, Virginia-based AES Corp., told the commission that Petersburg would be forced to close by April 11, 2018, without improvements to comply with the federal Environmental Protection Agency's (EPA) Coal Combustion Re- siduals (CCR) rule. IP&L; plans to spend $46.9 million on the CCR project and another $29.2 million to meet EPA's National Ambient Air Quality Standards for sulfur dioxide. Several environmental groups led by the Sierra Club and Hoosier Environmental Council urged the commission to deny the utility's request, saying they favored the plant's retirement next year. But IP&L; prevailed when the IURC concluded the pol- lution control plan was cost-effective and would preserve "steel in the ground" electric generation that serves as a hedge against market volatility. Last year, IP&L; converted its 700-megawatt (MW ) Harding Street power plant in downtown Indianapolis to natural gas from coal. The utility also retired its 341-MW Eagle Valley coal plant near Martinsville, Indiana, where it is building a new 650-MW gas plant. Petersburg is IP&L;'s only remaining coal plant. In Ohio, Houston-based Dynegy Inc. agreed to purchase Dayton Power & Light Co.'s 28% interest in the 1,300-MW Zimmer baseload plant near Moscow, Ohio, and 36% stake in Units 7 and 8 at the 1,378-MW Miami Fort plant near North Bend, Ohio. The deal is expected to become final by the end of this year. The agreement contains termination rights for both par- ties if the sale is not consummated within 12 months. David Onufer, a Dynegy spokesman, said his company "is looking for- ward to owning Miami Fort and Zimmer outright and operating them. They are great power generation facilities and we look forward to continuing to be a good neighbor in these two strong Ohio communities." Recently, Dynegy sold its 40% ownership interest in the Conesville power plant, representing 312 MW, to American Elec- tric Power (AEP) and acquired AEP's 25.4% ownership interest (or 330 MW ) in the Zimmer power plant. No cash was exchanged, no additional debt incurred and AEP returned $58 million in letters of credit previously posted by Dynegy to AEP. As a result, Dynegy owns 71.9% (971 MW ) and operates Zimmer. Dynegy no longer has ownership interest in the AEP-operated Conesville. Columbus, Ohio-based AEP has been retiring coal plants in recent years as it looks to add more natural gas generation and renewables, particularly solar energy. Coal currently accounts for about 47% of its generation portfolio, down from 71% in 2005. Nevertheless, AEP chairman, president and CEO Nicholas Akins said in late April that coal will remain an important part of his company's generation portfolio going forward. Hallador Buys Coal From Gold Star Hallador Energy Co. President and CEO Brent Bilsland declined to comment in April on coalfield speculation that his company's Sunrise Coal subsidiary may be interested in acquiring the on- again, off-again Gold Star underground steam coal mine, former- ly known as Landree, near Jasonville in Greene County, Indiana. Bilsland said if production resumes later this year at Sunrise's Carlisle underground steam coal mine in Sullivan County, Indi- ana, the mine's capacity would be reduced from 3.3 million tons annually to about 2.5 million tons a year. have to address the issue of quality of Indian coal that can be exported as pollution generated from Indian coal is higher." At the same time, the government would be more aggressive in substituting imported coal with domestic supplies, the minister said. According to data sourced from Central Electricity Authority (CEA), total coal imports during April 2016 to February 2017 was estimated at around 60 million metric tons (mt). Of this, 19 mil- lion mt were imported by 29 power companies for blending with domestic coal while 11 other companies imported 42 million mt for entirely feeding their plants. CIL officials said even though imports during the period were down 20% over the corresponding previous period, even if domestic miners were able to replace at least half of the imported volume by domestic coal, it would mitigate the rising problem of pithead stocks. As of March, pithead stocks had mounted to 69 million mt, up from around 49 million mt in May 2016. Government officials said, according to recent communications from the Ministry of Power, domestic thermal power plants would require an estimated 584 million mt of coal during 2017-2018. Based on past trends, thermal power plants accounted for about 75% of domestic coal consumption, total coal consumption during the year would be 780 million mt, which could be adequately met at current rates of production by domestic miners. Late last year, Ministry of Coal started planning to enter in- ternational coal markets starting with shipments to neighboring Nepal and Bangladesh. However, even a modest starting offer of 10 million mt had failed to find takers in Nepal and Bangladesh, which were averse to buying low grade, high ash content Indian coal. Even within four months of planning to commence coal exports, the government jet- tisoned the plan early this year. However, with the government once again keen to explore ex- port options to check mounting stocks, miners including CIL see higher volumes of beneficiation of coal as a prerequisite to woo international buyers of Indian coal. Peabody to Retain Metropolitan Coking Coal Operation in Australia Peabody has decided to retain the Metropolitan metallurgical coal mine and its associated 16.67% interest in Port Kembla Coal Ter- minal, after proposed purchaser South32 terminated the purchase contract. South32 was unable to obtain clearance from the Aus- tralian Competition and Consumer Commission (ACCC) within the timeframe required under the contract. "We are surprised that South32 and the ACCC reached an im- passe, given both the physical synergies and the global nature of the metallurgical coal markets," said Glenn Kellow, president and CEO, Peabody Energy. "On the other hand, we see continuing opportunities given Metropolitan's quality coking coals and port location, and our objective will be to operate the mine while maxi- mizing returns in the international marketplace." The Metropolitan mine, which exports coal from Port Kembla in New South Wales, sold 2 million metric tons (mt) of hard coking coal in 2016 and has approximately 26 million mt of proven and probable reserves. The mine employs approximately 250 employees and contractors. Continued from p. 6... Continued on p. 11...