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ILB Q2 coal production totals 23.4 million st, down 5%: MSHA

https://www.chemnet.com   Jul 25,2016 Platts
Illinois Basin coal production totaled 23.4 million st in the second quarter, down nearly 5% from the prior quarter and down 22.4% from the year-ago quarter, according to Mine Safety and Health Administration data.

For the year, coal production in the basin totaled 50.3 million, putting the basin on an annualized pace that would be the lowest since 2008, when production totaled 99.3 million st.

The Illinois Basin is made up of mines in Illinois, Indiana and western Kentucky.

The lost tonnage is not expected to reverse given increased competition from Northern Appalachia, said Matt Preston, an Annapolis, Maryland-based analyst for Wood Mackenzie.

"I think they're going to face serious challenges," Preston said. "Eastern gas is driving their prices down, forcing NAPP coal to be more competitive."

SUGAR CAMP INCREASES PRODUCTION

Several top producers have cut production over the last year, although Foresight Energy countered that trend by increasing production to 4.9 million st, a 13.7% increase from the prior quarter and 4% over the year-ago quarter.

Foresight's Sugar Camp mine, the basin's largest in terms of tonnage, produced 2.9 million st in the quarter, up 3.8% from the prior quarter and up 8.1% over the year-ago quarter.

Foresight's Mach No. 1 mine totaled 1.4 million st in the quarter, up nearly 35% from the prior quarter, but still down 10.9% from the year-ago quarter.

Alliance Resource Partners, which produced 5.7 million st in the second quarter, dropped production 16% from the first quarter and 34% from the year-ago quarter.

Alliance's River View mine, the second biggest in the basin, produced 2 million st in the quarter, down 7.8% from the prior quarter and down 9.9% from the year-ago quarter. Its Hamilton No. 1 mine, formerly White Oak, produced just 504,272 st in the quarter, down 31.1% from Q1 and down 63.3% from the year-ago quarter.

Peabody Energy's biggest IB mine, Bear Run, produced 1.8 million st in Q2, down 6.7% from the prior quarter and down 7.8% from the year-ago quarter. Murray Energy's New Era mine, part of the Galatia complex, produced 487,924 st in Q2, down 48.1% from the prior quarter and down 15.6% from 2015.

Murray's production totaled 1.6 million st in the quarter, down 3.9% from the prior quarter and down 34.9% from the year-ago quarter.

Aside from Sugar Camp, only a few mines have increased production both year-over-year and from the prior quarter. Knight Hawk's Prairie Eagle underground mine is one of them, producing 887,225 st in the quarter, up 3.3% from the prior quarter and up 7% from the prior year.
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