Massey Energy Postpones West Virginia Coal Prep Plant Expansion

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Massey Energy Company (NYSE:MEE) (Richmond, Virginia) has put the $10 million expansion at its Delbarton Mining Company subsidiary coal mine in Delbarton, West Virginia on hold. The project would have involved the construction of a 1,000 ton per hour coal preparation plant adjacent to the existing 600 ton per hour plant. The company is citing poor market conditions and rigorous West Virginia state government regulations as the cause of nonfeasible conditions for expansion in the area.

Massey Energy's capital expenditures for 2003 will focus on rebuilds of existing mining and prep plant equipment. Ninety-five percent of these rebuilds will involve continuous miners, shuttle car systems, and new feeders.

Capital spending has slowed considerably for the company, which began operations of a new $100 Million Aracoma underground coal mine located near Stollings, West Virginia in 2001. This mine is operated by Massey's subsidiary Bandmill Coal Company and is scheduled to produce three to four million tons per year.

Another Massey subsidiary, Tennessee Consolidated Coal Company, has recently begun operations of a new coal distribution terminal located in Kingsport, Tennessee. The coal terminal will be owned and operated by Tennessee Consolidated Coal and will be dedicated to supplying the needs of Eastman Chemical Company's coal-fired power plant and chemical plant. The terminal will unload railcars and deliver approximately 5,800 tons of coal per day to the Eastman Kingsport chemical complex. Eastman's power plant produces about 202 megawatts of electricity for internal use.

Massey Energy is one of the largest coal producers in the U.S and will produce close to 45 million tons of coal in 2002. The company has coal mining operations in four eastern states including West Virginia, Kentucky, Tennessee, and Virginia.