CONSOL Energy Inc, the leading diversified fuel producer in the Eastern US is providing an operations update for the quarter ended June 30th 2012.
CONSOL Energy's core values are safety, compliance and continuous improvement. During the Q2, CONSOL made meaningful progress in safety across the company. The safety accomplishments were highlighted by Enlow Fork Mine which ran accident free while producing 2.6 million tonnes and Buchanan Mine which ran accident-free while producing 1.1 million tonnes.
Several other mines and operations also had accident free quarters. Regarding compliance across the coal division, violations were down 18% from the Q1. In continuous improvement, a CONSOL operated Marcellus Shale well in Westmoreland County, Pa. achieved a peak 24 hour production rate of 17.9 MMcf, the highest of any well in company history.
CONSOL's Coal Division produced 14.6 million tonnes during the quarter, including 1.1 million tonnes of low vol metallurgical coal from the company's Buchanan Mine. CONSOL's Gas Division produced 37.3 Bcf for the 2012 Q2 or 10% more than the 34.0 Bcf produced in the 2011 Q2 adjusting for the subsequent sale of 3.5 Bcf of that quarter's production to Noble Energy Inc. and Antero Resources Appalachian Corp. During the quarter, CONSOL Energy drilled 17 Marcellus Shale wells, while placing 18 online. Additionally, Noble Energy drilled six Marcellus Shale wells in the liquids rich area of the play.
Q3 2012 Forecasts;
Coal - CONSOL Energy expects to produce 14.0 million tonnes to 14.5 million tonnes during the quarter including 1.1 million at the Buchanan Mine. As previously announced, the Blacksville No 2 and Robinson Run mines will see normal vacation schedules increased by a combined three weeks during the quarter. As noted previously, we have idled the surface operations at the Fola Mine and expect to idle the underground mining at the end of August.
Coal Division Operations;
During the Q2 both the McElroy and Blacksville No 2 mines successfully completed 120 psi sealing projects which decreased their active footprints by approximately 25%, improving their safety, efficiency and maintenance requirements. At the Buchanan Mine, the mainline belt terminal groups were replaced; the change out will improve our availability and compliance around the terminal groups.
Demonstrating how its coal and gas divisions can work together to create value for shareholders, for the first time, CONSOL Energy's Coal Division supplied the Gas Division with 40 million gallons of treated mine-sourced water to support their drilling activity.
CONSOL's total coal inventory increased during the quarter by 0.2 million tonnes to 2.4 million tonnes as of June 30th 2012. Thermal coal inventory increased by 0.1 million tonnes during the quarter, as production outpaced sales. Low vol Buchanan coal inventory also increased by 0.1 million tonnes during the quarter to 0.3 million tonnes.
Mr J Brett Harvey chairman and CEO of CONSOL Energy said that "The impressive results that were achieved by our entire operations team during the second quarter reinforce our belief that adherence to our core values of safety, compliance and continuous improvement drives success. I commend our employees for their daily commitment to these values."
Source - CONSOL Energy
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