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Alliance Resource Partners (ARLP) says it is evaluating the potential impact of idled production...

Alliance Resource Partners (ARLP) says it is evaluating the potential impact of idled production at its Pontiki mine in Kentucky to its Q3 results, including a possible impairment charge. Regardless of any decision to resume or indefinitely suspend production at Pontiki, ARLP anticipates the impact to future distributable cash flow will be negligible.
Comments (3)
  • dy2
    , contributor
    Comments (32) | Send Message
     
    Per the news release, the Pontiki mine produced about 558,000 tons in 2012 until it was shut down on August 29th (about 8 months) for inspection. The new Tunnel Ridge mine opened on May 15th is expected to produce 900,000 tons in the 3rd Qtr. and 1,200,000 in the 4th Qtr. The new mine is expected to produce about 6,000,000 tons in 2013.This should put the Pontiki mine in some perspective. As indicated in the release above, ARLP "anticipates the impact to future distributable cash flow will be negligible".
    2 Oct 2012, 08:48 PM Reply Like
  • groundhawk1
    , contributor
    Comments (62) | Send Message
     
    Will we really have buyers for this amount of additional product??

     

    Anticipating the state of the economy and the down turn of the Chinese requirements, shut down of coal fired plants, etc., I'm not to sure that all the additionall tonnage will be sellable.
    3 Oct 2012, 12:16 AM Reply Like
  • dy2
    , contributor
    Comments (32) | Send Message
     
    Generally speaking, ARLP is very careful in analysing the need for their coal in advance. They almost always enter into long term contracts for their production, as you can see from any of their 10k's.
    Most of their coal production is sold out for the next 3 years.
    In addition, they produce mostly high sulfur coal, which, thanks to scrubbers, is now the cheapest coal to produce and sell, other than PRB coal, which has lower BTU content and has to be shipped from the West.
    ARLP's high sulfur coal is beginning to eat into Cent. App. coal.
    3 Oct 2012, 09:06 AM Reply Like
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