COLUMBUS – American Electric Power has sold its AEP coal mining operations in Ohio and Kentucky to various affiliates of Wexford Capital LLC.
According to the terms of the transaction, AEP will receive $8.8 million cash and Wexford will assume an additional $10.8 million in future reclamation liability.
All Ohio sites. Wexford purchased all of AEP’s mining operations in Ohio, including one active mine portal, a coal preparation plant and a rail loading facility.
Also part of the transaction are mining assets in southeastern Kentucky, including two surface mines and six underground mine locations, two permitted reserves, a coal preparation plant and rail loadout facilities.
AEP will retain responsibility for completing approximately $35 million in reclamation work at sites in Kentucky.
The liabilities for this reclamation work have been fully reserved.
Focus on utilities. “With the sale of these assets, we’ve exited the business of mining coal to sell into the marketplace,” said Mike Morris, AEP chairman, president and CEO.
The company will continue to operate its Dolet Hills lignite mines in Louisiana, which powers the Dolet Hills Power Station.
In addition to its Dolet Hills operations, AEP maintains ownership interests in coal reserves in Pennsylvania, West Virginia, Ohio, Indiana, Illinois, Utah and Colorado as well as royalty interests in West Virginia reserves.
The company has no current plans to mine those reserves.
AEP acquired the AEP Coal assets when the company purchased the assets of Quaker Coal in 2001, as part of Quaker’s bankruptcy proceedings.
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