Orano warns of financial problems at Niger uranium plant
The West African nation increasingly seeks new partners, such as Russia, in its mining sector.
Alpha Natural Resources took a $.73 billion hit in the fourth-quarter, but the US coal producer, the third largest of coking coal in the world, said it has a strategy to counter weak US coal markets by cutting production and concentrating on met coal used in steelmaking.
Announcing its Q4 and full-year results, the Virginia-based company (NYSE:ANR) said it lost $733 million last quarter or $3.34 per share, compared to net income of $10 million in the year-ago period. Alpha recorded a $745 million goodwill impairment charge during the quarter related to higher operating costs at the company’s eastern coal operations. The cost of producing a ton of coal in Appalachia has risen from $64.18 in the fourth quarter of 2010 to $81.14 last quarter.
Alpha also paid a $210 million settlement to the government in relation to an explosion at the Upper Big Branch Mine in West Virginia in 2010 that killed 29 miners. The mine was owned by Massey Energy, which Alpha later acquired.
CEO Kevin Crutchfield said the results were affected by less demand in the US for power-generating thermal coal due to a mild winter, along with large utility stockpiles and competition from natural gas.
Alpha Natural Resources earlier this month announced cutbacks due to slackening demand.
The company will immediately mothball four mines in central Appalachia, plans to idle two more by early next year and scale back output at other mines.
Despite the negative picture in the US, however, Alpha said the market for steelmaking is strong, particularly fueled by emerging economies in Asia continuing to demand high-quality metallurgical coal.
“As the third-largest supplier of coking coal in the world, with the largest port capacity of any US coal producer, Alpha is well-positioned to an improving global met coal market,” Crutchfield said during a call to analysts.
