Consol wraps met coal contract talks

CONSOL Energy has completed most of its coal negotiations for low-volatile and high-volatile metallurgical output, including that from its Buchanan mine in Virginia.
Consol wraps met coal contract talks Consol wraps met coal contract talks Consol wraps met coal contract talks Consol wraps met coal contract talks Consol wraps met coal contract talks

Consol Energy's Buchanan mine in Virginia.

Donna Schmidt

The company said negotiations included almost 3 million tons at a selling price of $US165-175 per ton, free on board. The coal will be shipped to customers in North America as well as Europe and Asia.

Consol’s Buchanan operation in southwestern Virginia produced premium low-vol coking coal for the steel industry worldwide.

In related company news, Consol officials announced over the weekend that the company has inked an agreement to buy the remaining shares of CNX Gas it does not already own.

The deal for 9.5 million shares was signed with stockholders represented by intermediary T Rowe Price Associates. Under the transaction, Consol agreed to commence a tender offer by May 5 of $38.25 per share.

In total, the coal and gas producer will pay about $363 million for the TRP-controlled shares and will finance the deal with “internally generated funds, borrowings under its credit facilities and/or offerings of securities”

Consol already owned approximately 88.3% of CNX stock. The new transaction represents 37% of the shares of CNX Gas that CONSOL Energy does not currently own.

Earlier this month, the producer obtained the exploration and production arm of Virginia-based Dominion Resources in a $3.5 billion deal.

In January, Consol announced a capital budget for 2010 of $1 billion.

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