DTC Coal “MSHA” Flash

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DTC Coal “MSHA” Flash

MSHA Q3 2017 Production Review

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Detailed U.S. coal company production analysis before quarterly results are released

DTC Flash©: MSHA Q3 2017 Production Update

Q3 2017 MSHA Production: We estimate that about 96% of the expected production has been reported thus far. However, we note that there appears to be some inconsistencies and we are hunting down corrections as we find them. Additionally, there are still an estimated 7 to 9 mm tons of missing reports thus far. For this iteration, we have assumed the production volume from Q2 as a proxy for the missing entities. Peabody Energy’s Bear Run, Foidel Creek (Twentymile) and Francisco mines were not in the latest MSHA run. Also missing is Bowie’s Skyline mine in Utah.

With noted caution, we estimate Q3 production around 197 mm tons. This compares to EIA’s estimate of 206.5 mm tons which represents a 9.2 mm ton overestimation. The largest gap was in Napp where EIA estimated 29.8 mm tons and MSHA count is closer to 24.8 mm tons. EIA was also over in the SPRB and Gulf Lignite by 3.8 mm and 2.4 mm tons, respectively. EIA underestimated Capp by 1.3 mm which continues a trend where EIA has overestimated Napp and underestimated Capp – a difficult distinction given the estimates are based on state-level railcar counts.

DTC Comments: Arch Coal (ARCH) completed the sale of its Lone Mountain complex (Capp), two thought-to-be idled properties and two prep plants to Revelation Energy for $8.3 mm in September and as such, we have removed production from Arch’s profile.

  • Capp: Mt. Laurel reported 268K tons, down from 341K tons seq and 371K tons YoY. Longwall moves were expected at Mt. Laurel in both Q1 and in July.
  • Napp: Sentinel reported 381K tons, up from 371K tons seq and 286K tons YoY. Leer reported 749K tons, down from 1.01 mm tons seq and 977K tons YoY. A longwall move was scheduled at Leer for Q3.
  • ILB: All production from Viper.
  • CO/UT: All production from West Elk. A long wall move was scheduled for Q3.
  • PRB: Black Thunder reported 19.26 mm tons, up from 15.65 mm tons seq but down from 20.04 mm tons YoY. Coal Creek reported 2.10 mm tons, down from 2.21 mm tons seq and 2.50 mm tons YoY.

This DTC report also covers production from: Alpha Natural Resources, Arch Coal Inc, Cloud Peak Energy, Cliffs Natural Resources Inc, CONSOL Energy Inc, Peabody Coal Company, Patriot Coal Company, Foresight Energy, Hallador Energy, Murray Energy, Rhino Resource Partners, Global Mining Group, Westmoreland Coal Company.

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