Consol announces closure on WV mine sales - Beckley, Bluefield & Lewisburg News, Weather, Sports

Consol closes on WV mine sale deal

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Consol Energy Inc. announced Dec. 5 it had closed on its late-October agreement to sell its Consolidation Coal Company subsidiary to a Murray Energy Corporation at a value of $3.5 billion.

The sale includes all five of its longwall coal mines in West Virginia.

Consol announced Dec. 2 it had passed the federal antitrust waiting period.

Included in the proposed sale are Consol's Shoemaker Mine in Benwood, Robinson Run Mine near Mannington, Loveridge Mine in Fairview, McElroy near Moundsville and Blacksville No. 2, which straddles the West Virginia-Pennsylvania border.

Murray Energy also will acquire 1.1 billion tons of Consol's high quality, low-sulfur Pittsburgh No. 8 seam reserves in addition to its river and dock operations, a network of 21 towboats and 600 barges that transported 19.3 million tons of coal and other commodities along the upper Ohio River system last year.

"The completion of this complex transaction this year enables us to enter 2014 with our focus of achieving our gas growth production targets of 210-225 Bcfe for 2014 and 30 percent annual gas production growth in 2015 and 2016," said Consol Chairman and CEO J. Brett Harvey.

The total consideration paid in the transaction includes $850 million in cash paid at the closing and future payments expected to total nearly $18.4 million in value, resulting from the retention of a royalty on select reserves and tolling fees at Consol's Baltimore Terminal.

Murray Energy also is acquiring $2.4 billion on Consol's balance sheet liabilities as well as Consol's UMWA 1974 Pension Trust obligations, which currently value about $94.1 million.