The property auctioned off by Shrader Real Estate and Auction Co. of Columbia City, Ind., has been owned for more than four decades by American Electric Power Co. of Columbus, Ohio. After its Franklin Real Estate arm acquired the Henderson County holdings in the early 1970s, AEP proposed constructing a 3,900-megawatt coal plant near Geneva that would have been the largest such facility in the U.S. Local opposition to the project subsequently forced AEP to abandon those plans. Eventually, the company’s Indiana Michigan Power subsidiary built a 2,600-megawatt coal plant about 50 miles away near Rockport in Spencer County, Ind.
AEP finally decided to sell its remaining Henderson County holdings after concluding it would never build a plant there and the huge tract of land represented a “non-core” asset that could be safely jettisioned.
Gene Klingaman, the auction manager, said Peabody was the only coal company among the six entities interested in buying “the whole property.” Normally, the land would be sold off in pieces. “But large blocks of farmland are hard to find today…there were people from different states that bid.”
Klingaman confirmed the sale included extensive coal reserves. “That sale includes the mineral rights,” he said. “There’s coal under about 925 acres,” but the reserves have not been proved up. “We owned the majority of the oil and gas, and a little less than a thousand acres of coal.”
Peabody Spokesperson Megan Gallagher said the company has no immediate plans for the property. The chance to own the vast holdings was just too enticing to pass up, however. If Peabody chooses not to develop one or more mines in Henderson County, it conceivably could “flip” the property to another coal producer who might. If so, there could be several prospects. Alliance Resource Partners is ramping up production to more than 5 million tons a year at its new River View underground mine near Uniontown in neighboring Union County just downriver from Geneva. Patriot is actively mining in Henderson County.