STEAMBOAT SPRINGS (AP) – The pending sale of the Twentymile Coal Co. Mine outside Steamboat Springs is a piece of rare good coal news for Routt County officials.
Peabody Energy said last week it was selling Twentymile and the El Segundo and Lee Ranch mines in New Mexico for $358 million in cash, as well as the assumption of certain liabilities, to Bowie Resource Partners.
The transaction is expected to close by the first quarter of 2016, and Bowie will become the largest bituminous coal producer in the western United States. With 1,700 employees operating at five mining complexes in Colorado, New Mexico and Utah, Bowie’s production will double to 25 million tons per year.
“Nationally, coal might be on the decline, and there might be some day in the future when there is no coal industry, but my hope is we’re the last coal mine standing,” Routt County Commissioner Tim Corrigan said.
Twentymile Mine operates 24 hours per day, 361 days a year, about 15 miles southeast of Steamboat Springs.
In February, Twentymile had 335 full-time employees and is one of Yampa Valley’s largest employers. In 2014, Twentymile employed about 400 full-time employees. The mine produced 6.7 million tons of coal in 2014, down from 7.2 million tons in 2013.
Steady rumors about Twentymile’s future – including that it was going to close – illustrates its importance in the Yampa Valley.
“We live with that worry on an ongoing basis,” Corrigan said.
According to a news release from Bowie, all of Twentymile’s employees are expected to remain and become Bowie employees.
“I view it as a real positive development,” Corrigan said. “It’s hard to believe that Bowie would purchase the mine without the intent of continuing production.”
Bowie’s corporate offices are located in Louisville, Kentucky. Its operations office is in Grand Junction.
County Commissioner Cari Hermacinski said she had been hearing for months that Bowie was looking to buy Twentymile. She added she has talked to a couple of the mine’s employees.
“They viewed this as a good transition,” Hermacinski said. “If the people working out there think it’s a good thing, it probably is.”
Moffat County Commissioner Chuck Grobe also said he was glad to hear of the sale.
“Personally, I think it’s a good thing for the area,” Grobe said. “It brings a lot of stability.”
Bowie said the purchase will allow it to compete with natural gas concerns. Bowie is banking on existing long-term contacts the mines hold. For example, Twentymile has a contract with the Hayden Station power plant near Hayden. The station is currently adding $160 million worth of technology to reduce emissions.
“These acquisitions fit the vision and model that were the genesis of Bowie as we continue to buck the industry trend with long-term contractual partnerships with our customers and secure margins in our niche,” said Executive Chairman John Siegel.
