New W Kentucky mines to boost region's high-sulfur production

Washington (Platts)--8Jun2005

New underground coal mines being developed in western Kentucky could boost the
high-sulfur coal region's annual production by 3 mil-5 mil t/yr.

Within three months, initial production should get under way at Alliance
Resource Partners' Elk Creek mine in Hopkins County and Advent Mining's new
deep mine in neighboring Webster County, Dennis McCully, western Kentucky
representative for the Kentucky Coal Council, said Wednesday. The Coal Council
is a state agency that promotes coal development.

"We're getting some new companies and some new underground mines," McCully
told Platts Coal Trader. Advent, for instance, is expected to produce about
1-mil tons of coal/yr to supply a new contract with the Tennessee Valley
Authority, he said.

McCully said Ohio County Coal, a Peabody Energy subsidiary, also is
refurbishing the former Lodestar Energy mine in Webster and Union counties.
"They may be opening that back up," he said. If so, that would mean western
Kentucky's coal production could rise by about 5-mil t/yr. About 23.4-mil tons
of coal were produced in western Kentucky in 2004.

Veteran western Kentucky coal operator Don Bowles is also evaluating a new
underground mine that could be in production in 2006.

McCully said the western Kentucky coalfield also has seen "a half-dozen or so
smaller mines come on line in the last year or so." The mines, mostly surface
operations, are located in Muhlenberg, Hopkins and Crittenden counties.
Why the increase? "The burn is up ... we're continuing to consume more
electricity and we've had a lot of plants being scrubbed," enabling them to
burn the region's high-sulfur coal, he said.

This story was originally published in Platts Coal Trader
http://www.coaltrader.platts.com

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