Peabody is also evaluating whether to reopen the Empire mine near Craig, reported Rocky Mountain News. Peabody acquired Empire when it bought Twentymile from RAG Coal International in April 2004.

Twentymile group executive Chuck Burggraf said Peabody planned to increase the mine's output to 12 million tons by 2008.

The mine produced 8.6 million tons in 2004, making it the fifth most productive in the US according to International Mining Consultants' statistical review published in American Longwall Magazine. This equated to an average output of 11.18 tons per total man-hour from the 387 strong workforce.

Burggraf, speaking at the National Western Mining Conference in Denver, said the increase would require a new longwall system.

Increased production at Twentymile will offset production losses from the Seneca mine scheduled to close later this year.

Twentymile accounts for 5% of Peabody's coal output and about 20% of Colorado's production of 40.1Mt in 2004. This figure was a record for the state and worth US$1.08 billion. In 2005 output for Colorado is expected to increase by 3%-5%.