CONSOL Energy Inc. to Sell All Five WV Longwall Coal Mines
The State Journal
28 October 2013
CONSOL Energy Inc. announced Oct. 28 it will sell all five of its
West Virginia longwall coal mines and related assets for $3.5
billion in value to a Murray Energy Corporation subsidiary.
The mines being sold are McElroy Mine, Shoemaker Mine, Robinson
Run Mine, Loveridge Mine and Blacksville No. 2 mine. CONSOL
operates 12 bituminous mining complexes in four states.
Both Shoemaker and McElroy are located in the Northern Panhandle.
Blacksville, Loveridge and Robinson Run are located in the
North-Central portion of West Virginia.
Collectively, the mines produced 28.5 million tons of thermal coal
"While this transaction furthers CONSOL's E&P growth strategy,
the sale of these five mines — assets that have long contributed
to America's economic strength and our company's legacy — was a
very difficult decision for our team," CONSOL Chairman and CEO J.
Brett Harvey said in a news release. "The employees at these mines
are among the safest and most productive miners anywhere in the
"In the end, we concluded that the time had come to sell these
mature assets to ownership whose strategic direction is more
aligned with those mines."
CONSOL's River and Dock Operations are included in the
transaction. Murray Energy also is acquiring CONSOL's UMWA 1974
pension trust obligations. Under a contract with the UMWA, CONSOL
Energy currently services that obligation through a $5.50 per hour
contribution, which amounts to approximately $33 million per year.
The UMWA International President Cecil E. Roberts issued a
statement, saying the news that Murray Energy is buying five
active operations in West Virginia and one closed operation in
Pennsylvania from CONSOL Energy comes as "no great surprise,"
"This changes nothing for our members with respect to the terms
and conditions of their employment," Roberts said. "Our collective
bargaining agreement does not go away with this transaction, and
our members remain covered by its provisions.
"There will be no changes in pay, benefits, insurance, schedules,
working conditions, safety provisions, grievance procedures or any
other language in the contract."
Roberts said there are some 2,800 active hourly workers
represented by the UMWA at the five West Virginia operations that
have been sold to Murray Energy. Some 23,000 retirees, dependents
and surviving spouses are affected by this transaction.
"This sale enhances CONSOL Energy's ability to grow its gas
production, enabling the company to extend its gas growth
production targets beyond 2014," a news release from CONSOL
Harvey said he expects West Virginia to continue to play an
important role in CONSOL's growth strategy.
"We have a sizeable Marcellus Shale footprint in West Virginia,
which will take a significant amount of labor and capital to
develop," he said.
CONSOL is retaining its Buchanan Mine in southwestern Virginia as
well as the Miller Creek Mining Complex in southern West Virginia.
The parties expect to close the transaction by the end of the
In a press release issued Oct. 28, Robert E. Murray, Chairman,
President and Chief Executive Officer of Murray Energy, said, "no
company has developed a better legacy with its employees, with its
customers, with the financial markets, with the regulatory
agencies, or with the public in general, over many decades, than
has CONSOL and Consolidation Coal. Murray Energy intends to
preserve this well-earned legacy."
Robert D. Moore, Executive Vice President, Chief Operating Officer
and Chief Financial Officer of Murray Energy, continued, "we will
be able to efficiently operate the acquired Consolidation Coal
mines and provide their employees with an opportunity for long
Murray Energy currently operates six underground longwall mining
systems and 23 continuous mining units.
U.S. Sen. Jay Rockefeller, D-W.Va., issued a statement Oct. 28
saying he was monitoring the sale because he wants to make
"absolutely sure that West Virginia's coal miners are treated
fairly and with the total respect they deserve."
"Murray Energy must make it their priority to focus directly on
the thousands of West Virginia workers and retirees impacted by
this deal -- their workplace safety, their job security and the
health and pension benefits they've earned with tough and
dangerous work over many years," Rockefeller said. "I have spoken
with the senior leadership of CONSOL about the sale, and I have
asked Mr. Murray and his team to meet with me as soon as possible
to discuss their plans and address our miners' concerns.
"I intend to do everything I can to make sure every step of this
transition keeps the best interests of West Virginia's coal miners
and their families in mind."