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Source: SNLEnergy Coall Report

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Summary

Peabody Energy Corp. and Australia’s White Energy Co. Ltd. announced May 13 they have signed an agreement to pursue development of a coal upgrading plant that would be sited at a Peabody operation in the Powder River Basin.

Under the agreement, Peabody also has the first right to participate in new coal upgrading development projects that White Energy undertakes in North America and China. The deal also gives Peabody a right to acquire a nearly 15% equity interest in White Energy.

“The coal upgrading plant would utilize White Energy’s patented coal briquetting technology, a mechanical process that upgrades lower Btu coals,” the companies said in a joint statement. “The process increases the coal’s overall energy content by approximately 35 percent. The resulting product is higher quality, more efficient and cleaner, with lower carbon and other emissions. The upgraded coal can be used interchangeably with high rank thermal coal for a number of applications, including power generation, industrial processes and Btu Conversion, such as coal-to-gas and coal-to-liquids.”

“We view this technology as a way to unlock further value in our reserves in the Powder River Basin and at other locations to create new marketing opportunities for U.S. or export customers,” said Richard Navarre, Peabody’s president and chief commercial officer.