(SNL, October 31) – Powder River Basin coal production surged 47.1% in the third quarter from the prior period, though production remains below the year-ago quarter.
According to an S&P Global Market Intelligence analysis of U.S. Mine Safety and Health Administration data, PRB producers mined 91.7 million tons of coal in the third quarter, up sharply from 62.4 million tons in the year-ago period, but still 13.5% below what the region generated in the same period of 2015.
Peabody Energy Corp.‘s North Antelope Rochelle mine, the largest in the country, produced 26.7 million tons of coal in the quarter, up from 20.0 million tons in the prior quarter and approaching the year-ago production of 27.1 million tons. Peabody’s Caballo mine boosted its production from 1.7 million tons to 3.7 million tons quarter-to-quarter. Peabody’s Rawhide mine increased production from 638,936 tons to 2.3 million tons.
Arch Coal Inc., which just emerged from bankruptcy reorganization, ramped up coal production at its Black Thunder mine from 13.7 million to 20.0 million tons. Arch’s Coal Creek mine increased production from 1.7 million tons to 2.5 million tons quarter over quarter.
The three mines Cloud Peak Energy Inc. runs in the PRB boosted production from a cumulative 11.8 million tons in the second quarter to 17.0 million tons in the third quarter. On an Oct. 28 earnings call, Cloud Peak President and CEO Colin Marshall said higher gas prices should ensure PRB coal continues to burn through the winter.
“[A]t the moment, things have turned significantly in the right direction, but I think we’d like to see how the next few months play out to get a better understanding of how next year should be,” Marshall said. “But it was certainly looking better than it was a few months ago.”
Coal production from two former Alpha Natural Resources Inc. mines that have been run by Contura Energy Inc. since Alpha’s bankruptcy increased third-quarter coal production cumulatively from 7.0 million tons to 10.2 million tons.
Mines owned by Westmoreland Coal Co., Peter Kiewit Sons’ Inc., Western Fuels Association Inc., Wyodak Resources Development Corp. and Decker Coal Co. also increased production quarter to quarter.