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Peabody Begins Production At Highland No. 11 Mine.

Peabody Energy's Highland No. 11 underground mine near Morganfield, Ky., has begun shipping coal to LG&E Energy Corp. while the startup of the company's nearby Highland No. 9 underground mine has been delayed until late this year.

Peabody Spokesperson Beth Sutton confirmed Highland No. 11, which employs about 70 people, is shipping coal. The mine is expected to ship about 750,000 tons to LG&E, the parent company of Louisville Gas & Electric Co. and Kentucky Utilities Co., under a multi-year agreement. The sale of LG&E Energy's parent company, British-based PowerGen Plc., to German energy giant E. On AG was expected to become final by the end of June.

Of the two mines, Highland No. 9 will be much bigger and have a longer life. St. Louis-based Peabody originally targeted the mine for initial production by the end of June or early July. However, Sutton said in June that production at the mine will begin ramping up near the end of this year, with the mine in full production in January 2003.

Highland No. 9 is expected to produce about 4 million tons of coal annually for sale to the Tennessee Valley Authority's Cumberland steam plant near Nashville, Tenn., under an 8-year agreement that calls for Peabody to supply about 6 million tons each year to the federal utility. The remaining 2 million tons annually are expected to come from Black Beauty Coal Co. mines in southern Illinois. Peabody owns more than 82% of Black Beauty, based in Evansville, Ind.

Highland No. 9 has an estimated 85 million tons of reserves, enough to last at least 20 years. The mine, which will employ about 240 people, will take the place of Peabody's Camp No. 1 underground mine near Morganfield, which closed in October 2000.

At peak production, Highland No. 9 will use four production units including two super units equipped with a miner on each side of the section and two FCT continuous haulage units.

Coal will be moved by a 5 1/2-mile above-ground belt to the company's Camp No. 9 preparation plant. After cleaning and processing, the coal will be loaded onto Ohio River barges at Uniontown, Ky, officials said.

Matt Haaga, a veteran Peabody employee, recently was named operations manager for Highland Mining. He will oversee both Highland mines. In another Peabody development in Kentucky, the company has exercised an option to buy Beaver Dam Coal Co., a major holder of coal reserves in western Kentucky. Through the transaction, which was expected to close by the end of June, Peabody will become owner of more than 100 million tons of coal reserves and 22,000 surface acres.

Peabody said the deal will lower the cost structure of future mines to be developed in the region and expand the reserve base near the company's proposed 1,500-megawatt Kentucky Thoroughbred Energy coal-fueled power plant near Central City in Muhlenberg County, Ky.

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Title Annotation:Peabody Energy
Comment:Peabody Begins Production At Highland No. 11 Mine.(Peabody Energy)
Publication:Coal Age (1996)
Article Type:Brief Article
Geographic Code:1USA
Date:Jul 1, 2002

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