Massey boosts met coal reserves with Cumberland acquisition
Published: 18 Mar 2010 00:26:19 PSTSteelOrbis - Virginia, US-based coal producer Massey Energy Company (Massey) announced on March 16 that it has signed a definitive agreement to purchase Cumberland Resources Corporation (Cumberland) and its affiliated companies for $960 million in a combined cash and stock transaction.
Approximately 4.8 million mt of Cumberland's current annual production is of metallurgical quality. Of the estimated reserves owned by Cumberland, Massey believes more than half, corresponding to 216 million mt, have metallurgical coal qualities.
A press release by Massey said that Cumberland is one of the largest privately held coal producers in the US with coal revenue of $550 million in 2009 generated from the production and sale of 7.8 million mt of high quality Central Appalachian coal. Massey will acquire the company free of debt.
Based in Abingdon, Virginia, Cumberland operates primarily underground coal mines in southwestern Virginia and eastern Kentucky. Its assets include an estimated 416 million mt of contiguous coal reserves, a preparation plant in Kentucky served by the CSX railroad and a preparation plant in Virginia served by the Norfolk Southern railroad.
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