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NAPP Longwall Mines Off to a Slow Start


Combined coal production at the 25 largest Northern Appalachia mines was down only 1.6% in the first quarter, compared to 9.3% nationwide, with those operations turning out nearly 24.9 million tons of coal, compared to 25.3 million tons in the same period of 2012.

For the 12 months ending on March 31, production at the 25 mines was down only 1.1% compared to the same period a year ago, to 93.9 million tons, according to an SNL Energy analysis of Mine Safety and Health Administration (MSHA) data.

More than half of the 25 mines produced less coal in the first quarter than a year ago. Leading the production decline was CONSOL Energy’s Loveridge No. 22 mine in northern West Virginia. Production at Loveridge dropped 355,349 tons to 1.2 million tons during the first quarter and may have been hampered by an accident investigation. In February, a miner at Loveridge was critically injured and later died after being struck on the head with a slate bar while working on an underground mine car.
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Production at Alpha Natural Resources’ Emerald No. 1 mine in western Pennsylvania was also down sharply in the period. Coal production there dropped 29% to 878,950 tons. Alpha also saw a production decrease at its most productive mine in the region, Cumberland, where output slipped by 10,077 tons to nearly 2 million tons. For the 12 months ending on March 31, production at Cumberland was 9% lower at 6.4 million tons. Both mines operate in the Pittsburgh No. 8 seam. The mines sell high-Btu, high-sulfur steam coal, primarily to eastern U.S. utilities.

CONSOL’s Bailey mine reported a 5% decrease in production from the first quarter of 2012 to 2.7 million tons. For the trailing 12 months, Bailey production is 8.6% lower at nearly 10 million tons.

CONSOL also reported lower production from its Shoemaker and McElroy mines in Northern Appalachia. But it got stronger performance at its Enlow Fork and Robinson Run No. 95 mines.

Production at CONSOL’s Blacksville No. 2 surged 48% to 915,490 tons, compared with a year ago when CONSOL idled the longwall and cut back continuous mining due to weak market conditions. Production, however, was down from the fourth quarter of 2012 due to a fire in mid-March that continues to keep the mine idled. The company recently said it is close to setting a restart date.

During a recent conference call, CONSOL officials said production from Northern Appalachia could begin to pick up as inventories remain tight and the company is seeing new interest for coal from the region from utilities in the Southeast, which is traditionally served by Central Appalachia coal.

“Right now we’ve got about 6.5 million tons of our Northern App coal going down into the Southeastern markets,” said CONSOL Chief Commercial Officer James Grech. “And we have discussions that have started already looking at more sales—or adding those sales into 2014 and beyond. So that’s the extent that we’ve been penetrating, which for us is substantial, 6.5 million tons of our Northern App coal going down to the Southeast is a large percentage of our tons.”

Alliance Resource Partners LP’s Tunnel Ridge longwall mine in northern West Virginia had the largest output increase among Northern Appalachia coal mines in the first quarter. Production rose to 796,260 tons from 126,400 tons a year ago. Longwall production at the mine began in May 2012. Alliance Resource Partners’ general partner is Alliance Holdings GP LP.

At full capacity, Tunnel Ridge is expected to produce 6.5 million to 6.8 million tons of coal annually, up from 2 million tons produced in 2012.

Also showing production increases among mines in the region were Murray Energy Corp.’s Century mine in Ohio and Rosebud Mining Co.’s No. 78 mine in Pennsylvania.