“This is an historic event for Westmoreland,” said Westmoreland Chairman Keith E. Alessi. “The acquisition represents a transformation to our existing operations and expertise–this will more than double our business,” in one of the world’s most attractive mining jurisdictions.
The combined business will be the No. 6 North American coal producer, as measured by 2012 production, according to company officials. Additionally, activated carbon and char activities, although small in proportion to the coal business, “represent value-added product streams and provide expansion in the industrial environmental market and entrance into the consumer market,” added Alessi.
Westmoreland CEO Robert P. King was similarly enthused. “This acquisition,” he said, “significantly enhances our asset portfolio and positions us as the leading mine mouth coal producer in North America.”
The Prairie operations consist of six operating surface mines within Alberta and Saskatchewan and control mining rights to 654 million coal tons of Q4 2012. In 2012, Prairie operations delivered 22 million tons of low-sulfur thermal coal to domestic utilities. Mountain operations consist of one surface mine in Alberta that produced 4 million tons of low-sulfur, thermal coal in 2012, primarily for export, and one surface mine currently in reclamation. Mountain operations hold an aggregate reserve of 22 million coal tons of coal as of Q4 2012.
The transaction includes a Char production facility which sells to barbeque briquette producers and a 50% partnership interest in an Activated Carbon plant with Cabot Corporation. The Char plant produced 130,000 Char tons in 2012 and the Activated Carbon plant produced 14,500 tons of activated carbon in 2012.