Louisville, Kentucky (Platts)--1Apr2015/506 pm EDT/2106 GMT

Several coal mines in southern Illinois have temporarily reduced production and barge shipping has been adversely affected by high water in the Mississippi River, state and company officials said Wednesday.

"Through January and February, everybody was producing whole hog, but this high water has impacted everybody," Art Rice, a veteran official at the Illinois Office of Mines and Minerals' office in Benton, Illinois, said.

Peabody Energy's Wildcat Hills underground and Cottage Grove surface mines in Gallatin County "had to stop production because they can't ship the coal out," he said.

Charlene Murdock, a spokeswoman for St. Louis-based Peabody, confirmed that company "temporarily reduced production" last month. "It was in early- to mid-March when it was raining and the river was getting fairly high and the barges were not operating," she said.
Murdock was hoping to get an update on Wildcat Hills and Cottage Grove, but none was available as of late Wednesday afternoon.

Wildcat Hills produced 2 million short tons and Cottage Grove turned out 1.9 million st of high-sulfur thermal coal in 2014, according to the US Mine Safety and Health Administration.

Knight Hawk Coal, which operates several surface and underground mines in southern Illinois, was unable to ship an estimated 55,000 st of high-sulfur thermal coal in the first quarter because of shipping issues on the Mississippi, said Andrew Carter, the company's sales manager. Knight Hawk's Lone Eagle dock on the Mississippi near Chester, Illinois, has remained operational, he said, but his company had been unable to get all the barges it needs.

"We've had to drop off our shipments," Carter said. "We probably lost three total days in the quarter due to a lack of barges. That impacts us by about 55,000 [st] or so that we haven't got out in Q1.

"As quickly as we can get barges, we'll make it up," he added. "We haven't cut back at any of our mines."

Arch Coal, also based in St. Louis, owns a 49% stake in Knight Hawk.

Despite the early year shipping setback, Carter said Knight Hawk remains confident it can reach the 5 million st mark in production this year for the first time. "It's still a realistic target," he said.

An Illinois coal industry source claimed the New Era and New Future underground thermal coal mines near Galatia operated by Murray Energy subsidiary American Coal had "backed off" production recently.

However, Gary Broadbent, associate legal counsel and spokesman for St. Clairsville, Ohio-based Murray, said in an interview that was not true, as far as he knew.

Together, New Era and New Future produced about 11 million st in 2014.

Officials at the US Coast Guard office in St. Louis could not be reached for comment Wednesday about the status of shipping on the upper Mississippi.

--Bob Matyi, newsdesk@platts.com
--Edited by Richard Rubin, richard.rubin@platts.com

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