Coal Age

OCT-NOV 2017

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Page 6 of 51

October/November 2017 5 news continued assets to a new entity to be jointly owned by Knight Hawk Hold- ings LLC (Knight Hawk) and the company's secured noteholders. Armstrong expects its mining operations and customer ship- ments to continue throughout the chapter 11 process. "We remain firmly committed to serving our customers and to being a good employer by maintaining safe, productive operations as we undertake this process," said Armstrong Executive Chairman J. Hord Armstrong III. "We are confident that this court-supervised process is the best way to close the transaction expeditiously." Upon the close of the transaction, Knight Hawk will take con- trol of Armstrong's ongoing operations. The company filed various motions with the Bankruptcy Court requesting authorization to continue paying employee wages and providing health care and other benefits. Armstrong has also asked for authority to continue existing customer pro- grams and intends to pay suppliers in full under normal terms for goods and services provided after the filing date of November 1. As of June 30, Armstrong controlled more than 445 million tons of proven and probable coal reserves in western Kentucky and currently operates five mines. Armstrong also owns and oper- ates three coal processing plants and river dock coal handling and rail loadout facilities, which support its mining operations. In August, Armstrong Energy Inc. mentioned it was facing possible bankruptcy because it continued to experience operating losses and the inability to repay an interest payment. The compa- ny's net loss for the first six months of 2017 was $32.6 million, high- er than a net loss of $28.4 million in the second quarter of 2016. Pruitt Proposes Repeal of Clean Power Plan U.S. Environmental Protection Agency (EPA) Administrator Scott Pruitt issued a Notice of Proposed Rulemaking (NPRM) proposing to repeal the so-called Clean Power Plan (CPP). After reviewing the CPP, the EPA determined that the President Barack Obama-era regulation exceeds the agency's statutory authority. Repealing the CPP will also facilitate the development of U.S. energy resources and reduce unnecessary regulatory burdens associated with the development of those resources, keeping with the principles es- tablished in President Donald Trump's Executive Order on Energy Independence, the EPA said. w o r l d n e w s Exxaro Signs Long-term Agreement With Transnet Exxaro Resource Ltd. signed a coal export transportation agree- ment with Transnet, which will increase coal volumes from Water- berg to Richards Bay Coal Terminal (RBCT). The 10-year agreement between Exxaro and Transnet will allow for the transportation of a total of 7.8 million metric tons (mt) of export coal, of which 3 million mt will come from the Waterberg once all the projects are ramped up. "Exxaro is proud to be developing the Waterberg area in collab- oration with Transnet," said Mxolisi Mgojo, CEO of Exxaro. "This is an exciting milestone for Exxaro and is a realization of our vision to contributing to the unlocking of the Waterberg, thus creating jobs and powering economic development in South Africa. As such, we will be investing 50% of our R20 billion ($1.5 billion) coal capex program over the next five years in coal in the Waterberg area." This agreement, which supersedes the old agreement, will enable Transnet to increase rail infrastructure capacity to service both domestic and export markets from the Waterberg area, Mgojo explained. The new agreement comes at the time when Transnet's Water- berg program is in full swing with plans to complete the second phase of the project in March 2019. The Waterberg upgrade Phase 2 will grow export rail capacity to 6 million mt through incremental upgrades of the existing rail networks and yards using additional loops, while maintaining the existing axle load, electrical upgrades and improved train control systems. CEZ Cuts Power Plant Emissions in Czech Republic The largest Czech energy utility, the CEZ Group, has invested 100 billion crowns ($4.6 billion) in the second wave of greening of North Bohemia's brown coal power plants, Ota Schnepp, the CEZ spokesman for North and Central Bohemia, told Czech News Agency CTK. "Power plants will always rate at the top positions among air pollution sources, as even after they decrease emissions to an ab- solute minimum, they will still be the biggest production giants," Schnepp said. Compared to the early 1990s, emissions have been decreased by 92% for sulfur dioxide (SO 2 ), by 95% for particulate matter, by 50% for nitrogen oxides (NOx) and by 77% for carbon monoxide (CO), Schnepp said. In the next years, all measurable emissions will drop by an- other 50% thanks to the investments within the second stage of greening, owing to the completely restored Tusimice and Prunerov 2 plants and the newly built plant in Ledvice, among other invest- ments, he said. The long-term strategy of CEZ is to achieve a carbon neutral energy production by 2050. In the past decade, CEZ has invested more than 5 billion euros in low carbon technologies. Some coal- fired blocs will be shut down by 2020 due to the end of their life cycle and stricter emission limits, Schnepp said. The modernized Tusimice and Prunerov plants depend on coal from the Tusimice coal mines, therefore they will operate for as long as the mines are operating, with 25 years being the guaran- teed operation span, he added. The life cycle of the new, environmentally friendly plant in Ledvice is about 40 years, which covers the whole estimated re- maining life of the Bilina mine supplying coal to it, Schnepp said. Schnepp said the life cycle of the Pocerady plant cannot be antici- Continued on p. 7... top 10 coal-producing states (in Thousand Short Tons) Week Ending (10/21/17) YTD '17 YTD '16 % Change Wyoming 260,821 232,011 12.4 West Virginia 75,454 63,626 18.6 Pennsylvania 41,807 36,027 16.0 Illinois 39,307 35,095 12.0 Kentucky 35,583 34,300 3.7 Texas 30,027 31,269 -4.0 Montana 26,047 25,121 3.7 Indiana 25,723 23,166 11.0 North Dakota 23,261 22,398 3.9 Colorado 12,859 9,554 34.6 U.S. Total 635,561 575,457 10.4

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