Greymont owns 15 million tons of high-quality coal reserves near the eastern Kentucky town of Raven, as well as rights to obtain particular current mining permits.
The Raven facility, expected to commence production by spring 2006, could mine 1mtpa by 2007 when it reaches prime production levels.
Currently based in Ashland, Kentucky but awaiting the completion of its new West Virginia headquarters, ICG will also be constructing a 650tph preparation facility at the site in 2006.
The company currently owns operations in West Virginia, Kentucky and Illinois.
Led by New York billionaire Wilbur Ross, ICG purchased a majority of bankrupt Horizon Natural Resources' assets in October of last year and this year took control of Anker Coal Group and CoalQuest Development in a $US275 million deal.
ICG announced in July it would invest $US200 million to develop a new underground mine near Grafton in northern West Virginia.