Alliance Resource Partners, L.P. (NASDAQ: ARLP) announced today that its
subsidiary, Excel Mining, LLC (Excel), issued Worker Adjustment and
Retraining Notification (WARN) Act notices to all employees at the
Pontiki mining complex in Martin County, Kentucky. ARLP currently plans
to continue operations at the Pontiki complex until early December to
fulfill commitments under existing sales contracts at which time the
mine is expected to cease production.
"For over 36 years, the Pontiki mining complex has operated safely and
profitably — providing quality jobs for our hardworking people
and meeting the needs of customers," said Joseph W. Craft III, President
and Chief Executive Officer. "When Pontiki resumed production last year,
we knew the market outlook was uncertain but were hopeful that
conditions would improve. Unfortunately, market conditions remain weak,
and we have been unable to secure new coal sales commitments for Pontiki
coal beyond the existing 2013 contracts. While we are deeply saddened by
the impact of this decision on our employees, their families and their
communities, we have no choice but to take this unfortunate but
necessary step to begin the process of winding down production
operations at Pontiki."
ARLP continues to execute on its growth projects in the Illinois Basin
and Northern Appalachia, and management is currently evaluating options
to provide employment opportunities to Pontiki personnel at other ARLP
operations in those regions. Information sessions will be scheduled in
the near future to allow Pontiki employees to learn more about these
opportunities.
Following a closure order by the Mine Safety and Health Administration
with respect to the Pontiki coal preparation plant and associated
surface facilities, the Pontiki mining complex was temporarily idled on
August 29, 2012 and resumed operations on November 25, 2012. Due to that
temporary idling of the mine, ARLP recorded in 2012 approximately $26.6
million of related losses and charges, including a $19.0 million
non-cash asset impairment charge. ARLP does not currently expect the
closure of the Pontiki mine to have a material impact on its 2013
financial results.
The Pontiki mining complex is owned by Pontiki Coal, LLC and operated by
Excel, both wholly-owned subsidiaries of ARLP. The Pontiki mining
complex currently employs approximately 142 workers and has generated
2013 year-to-date coal sales and production volumes of approximately
613,000 tons and 634,000 tons, respectively.
About Alliance Resource Partners, L.P.
ARLP is a diversified producer and marketer of coal to major United
States utilities and industrial users. ARLP, the nation's first publicly
traded master limited partnership involved in the production and
marketing of coal, is currently the third largest coal producer in the
eastern United States with mining operations in the Illinois Basin,
Northern Appalachian and Central Appalachian coal producing regions.
ARLP operates eleven mining complexes in Illinois, Indiana, Kentucky,
Maryland and West Virginia. ARLP is also constructing a new mine in
southern Indiana and is purchasing and funding development of reserves,
constructing surface facilities and making equity investments in a new
mining complex in southern Illinois. In addition, ARLP operates a coal
loading terminal on the Ohio River at Mount Vernon, Indiana.
News, unit prices and additional information about ARLP, including
filings with the Securities and Exchange Commission, are available at http://www.arlp.com.
For more information, contact the investor relations department of ARLP
at (918) 295-7674 or via e-mail at investorrelations@arlp.com.
The statements and projections used throughout this release are based on
current expectations. These statements and projections are
forward-looking, and actual results may differ materially. These
projections do not include the potential impact of any mergers,
acquisitions or other business combinations that may occur after the
date of this release. At the end of this release, we have included more
information regarding business risks that could affect our results.
FORWARD-LOOKING STATEMENTS: With the exception of historical
matters, any matters discussed in this press release are forward-looking
statements that involve risks and uncertainties that could cause actual
results to differ materially from projected results. These risks,
uncertainties and contingencies include, but are not limited to, the
following: changes in competition in coal markets and our ability to
respond to such changes; changes in coal prices, which could affect our
operating results and cash flows; risks associated with the expansion of
our operations and properties; legislation, regulations, and court
decisions and interpretations thereof, including those relating to the
environment, mining, miner health and safety and health care;
deregulation of the electric utility industry or the effects of any
adverse change in the coal industry, electric utility industry, or
general economic conditions; dependence on significant customer
contracts, including renewing customer contracts upon expiration of
existing contracts; changing global economic conditions or in industries
in which our customers operate; liquidity constraints, including those
resulting from any future unavailability of financing; customer
bankruptcies, cancellations or breaches to existing contracts, or other
failures to perform; customer delays, failure to take coal under
contracts or defaults in making payments; adjustments made in price,
volume or terms to existing coal supply agreements; fluctuations in coal
demand, prices and availability; our productivity levels and margins
earned on our coal sales; unexpected changes in raw material costs;
unexpected changes in the availability of skilled labor; our ability to
maintain satisfactory relations with our employees; any unanticipated
increases in labor costs, adverse changes in work rules, or unexpected
cash payments or projections associated with post-mine reclamation and
workers′ compensation claims; any unanticipated increases in
transportation costs and risk of transportation delays or interruptions;
unexpected operational interruptions due to geologic, permitting, labor,
weather-related or other factors; risks associated with major
mine-related accidents, such as mine fires, or interruptions; results of
litigation, including claims not yet asserted; difficulty maintaining
our surety bonds for mine reclamation as well as workers′ compensation
and black lung benefits; difficulty in making accurate assumptions and
projections regarding pension, black lung benefits and other
post-retirement benefit liabilities; coal market's share of electricity
generation, including as a result of environmental concerns related to
coal mining and combustion and the cost and perceived benefits of other
sources of electricity, such as natural gas, nuclear energy and
renewable fuels; uncertainties in estimating and replacing our coal
reserves; a loss or reduction of benefits from certain tax deductions
and credits; difficulty obtaining commercial property insurance, and
risks associated with our participation (excluding any applicable
deductible) in the commercial insurance property program; and difficulty
in making accurate assumptions and projections regarding future revenues
and costs associated with equity investments in companies we do not
control.
Additional information concerning these and other factors can be
found in ARLP’s public periodic filings with the Securities and Exchange
Commission ("SEC"), including ARLP’s Annual Report on Form 10-K for the
year ended December 31, 2012, filed on March 1, 2013 with the SEC. Except
as required by applicable securities laws, ARLP does not intend to
update its forward-looking statements.
Copyright Business Wire 2013