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Released November 10, 2021 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--The past decade hasn't been kind to the coal-mining industry, but CONSOL Energy Incorporated (NYSE:CEIX) (Canonsburg, Pennsylvania) believes the worst may be in the past. The company pointed to a revived coal market in its third-quarter results, with higher prices, stronger demand, and an industrywide lack of capacity to meet that growing demand. CONSOL is pivoting away from thermal coal, which is burned at coal-fired power plants, and is emphasizing the production of metallurgical (met) coal, which is used in steelmaking. Industrial Info is tracking more than $2.1 billion worth of active projects from CONSOL.
Click on the image at right for a heat map of active CONSOL projects, from Industrial Info's Geolocator tool.
Starting in September, CONSOL made significant strides on its Itmann No. 5 Coal Mine and Preparation Plant in Itmann, West Virginia, which is expected to produce 900,000 tons per year of low-volume met coal for more than 20 years. Executives at CONSOL recently noted that earthwork for the preparation plant began in the third quarter and is about 50% complete. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a detailed project report.
"Our Itmann mine and preparation plant are progressing as expected," said James Brock, the chief executive officer of CONSOL, in a quarterly earnings-related conference call. "The mine continues to operate productively on a single production shift, with a second support shift that was recently added. Due to the improved market dynamics, the underground operations are generating positive operating cash flows on a consistent basis. We continue to explore options to further ramp up production and promote the Itmann product in the low-volume met market."
CONSOL purchased the long-defunct Itmann mining area in 2019 and is now tearing down the existing structures to make way for the new plant, with primary processing equipment from other CONSOL facilities awaiting relocation to the Itmann site. "Commissioning of the Itmann plant remains targeted for the second half of 2022, which will coincide with the ramp-up to full production at the mine shortly thereafter," Brock said in the conference call.
CONSOL's flagship operation is the Pennsylvania Mining Complex, which has the capacity to produce approximately 28.5 million tons of coal per year and comprises three large-scale underground mines: Bailey, Enlow Fork and Harvey. Brock said CONSOL is restarting development of a fifth longwall at Enlow Fork, and the company has a series of projects to relocate, repair and replace equipment used in at longwalls throughout the Pennsylvania Mining Complex, in which a long wall of coal is mined in a single slice. Subscribers can click here for a list of related projects.
"Coal production at the Pennsylvania Mining Complex came in at 5.3 million tons in the third quarter of 2021, compared to 4.5 million tons in the third quarter of 2020," Brock said in the conference call. "The improvement versus the prior year period was due to the increased demand for our product, as coal markets were just beginning to recover from the COVID-19-related demand decline in the third quarter of 2020. However, we encountered multiple operational, geological and logistic issues as well as planned maintenance shutdown that limited our production in the quarter."
The U.S. lost its appetite for thermal coal long ago, but CONSOL and other coal-mining companies continue to see demand for the energy-generation resource abroad. The API 2 spot price, which is the benchmark price reference for coal imported to northwest Europe, ended the third quarter at $151 per ton, or 193% higher than that of third-quarter 2020.
"As we stand today, we have a solid order book for 2022, and we will remain opportunistic on additional sales we booked," Brock said.
Domestically, the U.S. Energy Information Administration (EIA) expects surging benchmark prices for natural gas will increase coal use at U.S. power plants by about 13%, on average, for all of 2021. However, this does not change the long-term outlook for U.S.-based coal-fired energy, which Brock acknowledged in the conference call: "While we view recent domestic business as a positive development for us, we continue to focus on our long-term strategic shift into the export market, which we expect will de-risk our domestic exposure and allow us to capitalize on growing international demand for our product."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
Click on the image at right for a heat map of active CONSOL projects, from Industrial Info's Geolocator tool.Starting in September, CONSOL made significant strides on its Itmann No. 5 Coal Mine and Preparation Plant in Itmann, West Virginia, which is expected to produce 900,000 tons per year of low-volume met coal for more than 20 years. Executives at CONSOL recently noted that earthwork for the preparation plant began in the third quarter and is about 50% complete. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a detailed project report.
"Our Itmann mine and preparation plant are progressing as expected," said James Brock, the chief executive officer of CONSOL, in a quarterly earnings-related conference call. "The mine continues to operate productively on a single production shift, with a second support shift that was recently added. Due to the improved market dynamics, the underground operations are generating positive operating cash flows on a consistent basis. We continue to explore options to further ramp up production and promote the Itmann product in the low-volume met market."
CONSOL purchased the long-defunct Itmann mining area in 2019 and is now tearing down the existing structures to make way for the new plant, with primary processing equipment from other CONSOL facilities awaiting relocation to the Itmann site. "Commissioning of the Itmann plant remains targeted for the second half of 2022, which will coincide with the ramp-up to full production at the mine shortly thereafter," Brock said in the conference call.
CONSOL's flagship operation is the Pennsylvania Mining Complex, which has the capacity to produce approximately 28.5 million tons of coal per year and comprises three large-scale underground mines: Bailey, Enlow Fork and Harvey. Brock said CONSOL is restarting development of a fifth longwall at Enlow Fork, and the company has a series of projects to relocate, repair and replace equipment used in at longwalls throughout the Pennsylvania Mining Complex, in which a long wall of coal is mined in a single slice. Subscribers can click here for a list of related projects.
"Coal production at the Pennsylvania Mining Complex came in at 5.3 million tons in the third quarter of 2021, compared to 4.5 million tons in the third quarter of 2020," Brock said in the conference call. "The improvement versus the prior year period was due to the increased demand for our product, as coal markets were just beginning to recover from the COVID-19-related demand decline in the third quarter of 2020. However, we encountered multiple operational, geological and logistic issues as well as planned maintenance shutdown that limited our production in the quarter."
The U.S. lost its appetite for thermal coal long ago, but CONSOL and other coal-mining companies continue to see demand for the energy-generation resource abroad. The API 2 spot price, which is the benchmark price reference for coal imported to northwest Europe, ended the third quarter at $151 per ton, or 193% higher than that of third-quarter 2020.
"As we stand today, we have a solid order book for 2022, and we will remain opportunistic on additional sales we booked," Brock said.
Domestically, the U.S. Energy Information Administration (EIA) expects surging benchmark prices for natural gas will increase coal use at U.S. power plants by about 13%, on average, for all of 2021. However, this does not change the long-term outlook for U.S.-based coal-fired energy, which Brock acknowledged in the conference call: "While we view recent domestic business as a positive development for us, we continue to focus on our long-term strategic shift into the export market, which we expect will de-risk our domestic exposure and allow us to capitalize on growing international demand for our product."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
