Blankenship told the crowd at the Lehman Brothers Conference last week that Massey will boost metallurgical coal production in a bid to reclaim some of the coal market share currently held by producers in Australia.

 

About 40 million tons of metallurgical coal deals have been claimed by Australia-based companies from their American counterparts in recent years and Blankenship is keen to get some of them back.

 

He said strong global demand for steel, particularly from China and India, has driven metallurgical coal prices to impressive heights and Australia's bottleneck issues present an opportunity for the US to capitalise on opportunities being created.

 

Currently metallurgical coal accounts for 20% of Massey's 40Mt of total annual production, with the company set to expand this significantly over the next five years by boosting production at the Central Appalachian reserve.

 

Blankenship said production at the Central Appalachian site will increase from 16% to 35% and coal reserves will be boosted from 36% to 45% without making significant acquisitions.

 

He explained this will allow Massey to hold more coal while rivals' reserves decrease from production.

 

The reserve hosts 2 billion tons of coal.