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ASHLAND COAL EXTENDS LONG-TERM CONTRACTS WITH APPALACHIAN POWER COMPANY

 HUNTINGTON, W.Va., Oct. 14 /PRNewswire/ -- Ashland Coal, Inc. (NYSE: ACI) announced today that it has completed the renegotiation of its three low-sulfur coal supply agreements with Appalachian Power Company (APCO), an operating company of the American Electric Power System.
 The coal under all the contracts is for delivery principally to APCO's John E. Amos Plant in Putnam County, W.Va.
 One contract, which is supplied by Hobet Mining, Inc., was to expire on Sept. 30, 1998, but has now been extended to Dec. 31, 2003. Under the original contract, approximately 1.1 million tons would have been shipped in 1994, and thereafter the tonnage was scheduled to decline ratably each year until the contract's 1998 expiration. The revised contract calls for annual coal deliveries of 1.2 million tons beginning Jan. 1, 1994, and continuing to Dec. 31, 2003. It also provides for a minor price reduction effective Jan. 1, 1993, and for significant reductions on Jan. 1, 1994, July 1, 1994 and Jan. 1, 1995.
 In addition, the price under a second contract, which is supplied by Dal-Tex Coal Corporation and expires on Dec. 31, 1994, is being reduced in 1993, with further reductions on Jan. 1, 1994 and again on July 1, 1994.
 In connection with the previously stated price reductions, a third contract, under which shipments from Dal-Tex are to begin on Jan. 1, 1995, and which originally was to expire on Dec. 31, 1999, has been extended through Dec. 31, 2003.
 As a result of these renegotiations, adjustments will be made in the rates of amortization of the investments in these contracts. This will reduce amortization expense in 1994.
 William C. Payne, chairman, president and chief executive officer of Ashland Coal, Inc., said, "I am very pleased that we were able to negotiate the extension of two important coal supply agreements through the year 2003. This step represents a significant contribution to the long-term prospects of our company."
 Ashland Coal, Inc. is engaged in the mining, processing and sale of low-sulfur coal, and markets its coal principally to electric utilities in the eastern United States and into the export markets.
 Hobet Mining, Inc. and Dal-Tex Coal Corporation are independent operating subsidiaries of Ashland Coal, Inc.
 -0- 10/14/93
 /CONTACT: David G. Todd, vice president, Ashland Coal, 304-526-3755/
 (ACI)


CO: Ashland Coal, Inc.; Appalachian Power Company; Hobet Mining, Inc.;
 Dal-Tex Coal, Inc. ST: West Virginia IN: MNG SU: CON


CD -- PG006 -- 2036 10/14/93 09:04 EDT
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Publication:PR Newswire
Date:Oct 14, 1993
Words:413
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