Tuesday, November 20, 2012

Eastern coal companies sell heavy equipment as industry in region deals with production declines

Coal prices and production are down in the Eastern U.S. because of cheaper natural gas, increased pollution controls and geologic issues. The price of Eastern coal is down 30 percent, and production in Appalachia is down 9 percent. Several coal companies are auctioning off large earth-moving equipment to "generate cash and avoid maintenance" costs, Kris Maher of The Wall Street Journal reports.

The biggest auction of mining equipment that many industry officials said they had ever seen was in September, when 1,750 lots -- groups of certain types of equipment -- sold for $76 million. The sale has become known as "big iron." Much of the machinery was sold by Trinity Coal Corp., a West Virginia company in the middle of restructuring. It closed its Kentucky mines earlier this year after losing a large contract with a utility company. (Read more)

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