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Alliance completes Green River acquisition

OKLAHOMA-based producer Alliance Resources Partners has again grown in the Illinois Basin with it...

Donna Schmidt

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The acquisition includes an estimated 40 million tons of reserves in the West Kentucky 9 seam in Webster and Hopkins counties, as well as the 315-worker, 2.1 million ton per annum Onton No. 9 underground room and pillar operation near Sebree.

The deal’s financial terms were not released.

While the complex is currently running three active continuous mining units, air shaft construction is underway to allow the addition of a fourth CM unit as demand warrants increased production.

“The acquisition of Green River provides an attractive addition to ARLP’s existing operations in the growing market for Illinois Basin coal,” president and chief executive officer Joseph Craft III said.

“Ongoing expansion of scrubber capacity by US utilities supports our view that demand for Illinois Basin and northern Appalachian coal will continue to increase.

“We remain committed to ARLP’s mission of creating exceptional value for our unitholders through sustainable cash flow growth and increases in unitholder distributions.”

ARLP confirmed that 2012 production of about 1.5Mt from the Onton No. 9 operation was committed.

According to ARLP’s website, its other Illinois Basin operations – Dotiki, Gibson County, Hopkins County, Pattiki, Warrior and River View – produced a combined 24Mt in 2010, about 80% of the company’s total production.

Another Illinois Basin mine, Gibson South, is scheduled to start production of 3-3.5Mtpa in 2014.

Before the Green River purchase, ARP was predicting full-year 2012 production of 34-35Mt, helped by the start-up of its Tunnel Ridge longwall mine in West Virginia.

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