Englewood-based Westmoreland Coal Co. announced today that it has agreed to purchase Chevron Mining Inc’s Kemmerer Mine in southwestern Wyoming for $179 million plus approximately $14 million in working capital.
Westmoreland said that it anticipates the purchase price will be funded through a combination of cash consideration of approximately $74 million, plus the assumption of approximately $118 million in certain liabilities. These include post retirement medical, pension, black lung and asset retirement obligation liabilities.
Over the last five years, Kemmerer has produced an average of 4.7 million tons of high quality sub-bituminous coal for sale to the adjacent Naughton Power Station, as well as various customers located in the region.
The transaction includes approximately 118 million tons of coal reserves as of Dec. 31, 2011, enough for 20 years of production.
The company said that substantially all of Kemmerer’s projected production from 2012 through 2016 is committed and priced under existing sales contracts.
“We view the Kemmerer workforce, which totals 290 people, as a core component of the transaction,” said Keith Alessi, Westmoreland’s president and CEO. “Employees of Kemmerer will be a tremendous addition to our company and we look forward to welcoming them to the Westmoreland family.”
Howard Pankratz: 303-954-1939 or hpankratz@denverpost.com.
