CONSOL Energy announces operations update
Monday, Jan 21, 2013
PITTSBURGH, Jan. 18, 2013 /PRNewswire/ -- CONSOL Energy Inc. (NYSE: CNX), the leading diversified fuel producer in the Eastern U.S., is providing an operations update for the quarter ended December 31, 2012.
"CONSOL's mines and gas operations ran well during the quarter," commented J. Brett Harvey, chairman and chief executive officer.
"Substantial improvements in safety have been realized during the year and new records have been set all across the company. Yet in the fourth quarter, we suffered a tragic fatality. For 2013, we are focusing our efforts on reducing the severity of incidents, while maintaining the pace of overall accident reduction we've achieved the past five years."
CONSOL's Coal Division produced 14.3 million tons for the fourth quarter of 2012, including 0.7 million tons of low-vol coking coal from the company's Buchanan Mine. This was lower than the 15.2 million tons, including 1.4 million tons from Buchanan, in the fourth quarter of 2011. Annual 2012 coal production was 56.0 million tons, including 3.5 million tons from Buchanan and 0.1 million tons from Amonate. Annual 2011 coal production was 62.0 million tons.
Most of the 2012 reduction in coal production was due to the company's efforts to control inventory. Several mines were idled during 2012, as the company continually sought to match production and sales.
During the fourth quarter of 2012, CONSOL's total coal inventory decreased by 0.3 million tons to 1.4 million tons as of December 31, 2012. Thermal coal inventory decreased to 1.1 million tons during the quarter, as sales exceeded production. Low-vol Buchanan and Amonate inventory decreased from September 30, 2012 by 0.2 million tons, to 0.2 million tons.
CONSOL Gas Division produced 41.8 Bcfe for the 2012 fourth quarter, or 5% more than the 39.7 Bcfe produced in the 2011 fourth quarter. Annual 2012 gas production was 156.3 Bcfe (net to CONSOL). During the quarter, CONSOL Energy completed its second well in Noble County, OH.
This Utica Shale well, the NBL 16A, was completed with 16 stages and tested at 12.0 MMcfd and 768 barrels condensate per day. This well is currently shut-in for further dissipation of frac fluids and the installation of a gas gathering system. The early results from this well, coupled with the results from the previously announced NBL 1A well, in addition to competitor data, gives the company confidence to begin transitioning its Utica Shale program in Noble County from an exploration mode to a development mode. CONSOL now plans to drill 11 wells in Noble County in 2013.
Coal Division Operations
For calendar 2012, CONSOL's Coal Division saw safety exceptions drop 11%, from 150 to 134. A similar improvement of 11% was seen in compliance citations.
In safety, the Miller Creek Complex achieved Absolute Zero for the third consecutive year. During the fourth quarter, many of the company's coal preparation plants − including Bailey, Shoemaker, Loveridge, and Ireland load-out facility − achieved Absolute Zero. Enlow Fork Mine also achieved a safety milestone by becoming the first longwall operation in the company's history to accumulate over one million man-hours without incurring a lost time incident.
At Buchanan Mine, the first of two phases of the $24 million Horn Mountain Portal Project was completed. This portal is strategically located at the mouth of our future 5 North reserves. In the meantime, it is one-and-a-half miles closer to the current mining "face," enabling miners to get to and from the work site much more quickly. Phase two involves converting a vent shaft to a supply hoist. Once this phase is completed in June, seven miles – each way − of supply haulage will be eliminated. This will help to better control costs at the mine.
SOURCE CONSOL Energy Inc.
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