BRISTOL, Tenn. - Contura Energy Inc., which emerged from the bankruptcy of Alpha Natural Resources, announced on Wednesday a new metallurgical coal project in Logan County in its 2019 first quarter earnings report.
The company's board of directors approved investment in the "Lynn Branch Project," which it says has a high-quality, high volume met coal reserve of over 25 million tons.
"The project is expected to produce approximately 1 million to 1.2 million tons annually at its full estimated run rate, with a projected cash cost per ton in the low $60 range," according to the report. "The capital allocation required to bring the project online is estimated at approximately $25 million to $30 million and does not require an increase to previously guided capital expenditures."
The company said production is expected to commence in the second quarter of 2020.
Contura Energy reported its results for the first quarter of 2019 include the full quarter impact of the Alpha merger, which closed in November 2018.
"The Trading and Logistics segment sales in the first quarter of 2018 were largely driven by Alpha-related shipments, which are now included in the Central Appalachia Met (CAPP - Met) segment for the first quarter of this year," the report said.
Contura reported net income from continuing operations of $8 million, or $0.41 per diluted share, for the first quarter 2019. In the first quarter 2018, the company had net income from continuing operations of $58.3 million or $5.66 per diluted share.
Based in Tennessee, Contura operates the Cumberland mine in Waynesburg, Pennsylvania and several other Appalachian mines, as well assets in Wyoming.
About half of its coal revenue comes from metallurgical coal, which is used in steel making, according to data from the second half of last year.