Alpha Natural Resources Acquires 
Mining Operations & Coal Reserves 
from Progress Fuels


Mike Quillen

   Alpha Natural Resources, Inc. (NYSE: ANR), a leading Appalachian coal producer, announced that is has agreed to acquire certain coal mining operations in eastern Kentucky from Progress Fuels Corp., a subsidiary of Raleigh, North Carolina-based Progress Energy (NYSE: PGN). 
    Alpha will acquire the stock of Diamond May Coal Co. and Progress Land Corp. and the assets of Kentucky May Coal Co., Inc. from Progress Fuels. The operations to be acquired are adjacent to Alpha's Enterprise business unit and will be integrated with Enterprise. 
    Alpha will pay approximately $23 million plus an adjustment for working capital at closing, and will assume $8 million in reclamation liabilities.     Alpha plans to use its existing revolving credit facility to finance the transaction. 
    Diamond May operates two surface and two underground mines in Kentucky, employing 380 union-free employees. Production in 2005 was approximately three million tons of steam coal. 
    Diamond May controls an estimated 55.5 million tons of proven and probable surface and underground reserves, including the undeveloped Elkhorn 2 block of more than 35 million tons. Diamond May also operates a 700 ton-per-hour preparation plant and loadout facility on the CSX railroad. 
    Kentucky May Coal Co. owns an estimated 17.8 million tons of proven and probable underground reserves, most of which are high in Btu content and low in sulfur. It has no current active mines. 
    "This acquisition will more than double our reserve base in eastern Kentucky," said Michael J. Quillen, Alpha's president and CEO. 
    "What we learned from acquiring and quickly integrating the Callaway coal operations last October will help us with Progress. Like Callaway, these are the type of operations that meet our acquisition criteria, and they should benefit from being managed by one of our best business units, Enterprise." 
    Over the next two years Alpha plans to develop a slope and shaft into the underground Elkhorn 2 reserve, with first production expected from the mine in 2008. From a rail transportation standpoint, Elkhorn 2 is advantageously positioned with the growing utility scrubber market in the Southeast. 
Closing is anticipated by May 1, 2006 and is subject to customary closing conditions. 



Coal Career Opportunities



Michelle Holbrook

    Michelle Holbrook, Coal Careers Program Director, with the Big Sandy Community & Technical College, recently spoke to the Kentucky/Virginia Human Resources Officers at their monthly meeting about BSC&TC's role in the Kentucky Coal Academy. Big Sandy Community & Technical College's partners are Booth Energy and Excel Mining.
    The Coal Careers Program is a collaborative effort for workforce development. The average age of our current mining workforce is 49 years, therefore, the Coal Careers Program hopes to address the expected need for workers in the future and attract more miners into the coal industry. The program is 48 weeks long. Students complete 24 weeks of classroom instruction and 24 weeks of co-op experience. Students are paid $8.00 per hour by sponsoring coal companies. Students are considered part-time employees of the sponsoring coal companies.


Coal Careers students receive classroom instruction in the following: 
-- Underground Mine Certification 
-- Surface Mine Certification 
-- Basic Computers 

-- Safety & First Aid 
-- Business & Personal Finance 

-- MET (Mine Emergency Technician) 

-- Work-related Skills 
-- Welding 
-- Electricity 
-- Hydraulics
Virtual Training is available for training in the following fields: 

-- Continuous Miner 
-- Roof Bolter 
-- Dozer 
-- Haul Truck 
-- Loader
    The program has been well received. COHORT I: 22 students completed the first classroom

 session, their first 8-week co-op training, their second classroom session, and now 13 of the original Cohort I are participating in their second 8-week co-op session. COHORT II: 19 students have completed their first classroom instruction as well as their first 8-week co-op training and are now participating in their second classroom session which primarily consist of skills training. COHORT III: 20 students have completed their first classroom session and are now participating in their first 8-week co-op. 100 percent of the students taking the Underground Certification test passed. All of the students in Cohort I and Cohort II are CPR Certified. Cohort I and Cohort II students have received permanent miner certification as well. Applications are now being accepted for Cohort IV. Cohort IV is planned to begin on April 24, 2006. A new cohort of students is chosen about every 8 weeks. cl


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