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The thermal coal market in the US is still robust

Foresight Energy last year increased its exports amid a soft US domestic market, its chief executive told delegates at the 33rd Coaltrans World Coal Conference in Berlin.

Michael Beyer said exports rose to 45 per cent of production last year, but with the return of the domestic US market it has this year returned to its “traditional split” where one third of its coal goes to international markets and two thirds to the domestic market.

Foresight Energy operates in the Illinois Basin, which comprises Illinois, Indiana and Western Kentucky and has been a major coal producing region in the US for a long time.

Mr Beyer said that since 2000 production in the Illinois Basis has made a “come back”. In 2012 it was up 50 per cent from its low point and Foresight Energy expects that growth to continue into 2012 “The reason that the Illinois Basin now fares very well is because the Illinois Basin has the best remaining underground coal reserves left in the US,” said Mr Beyer.

However, he cautioned that there are a number of significant factors weighing down on demand, which have been affecting the US coal industry such as shale production and new regulatory issues.

“A lot of people are under the impression that the US coal industry is going away, but even with all these outside impacts there is still a very robust and significant thermal market in the US,” he said.

With over 3 billion tons of coal reserves, Foresight Energy believes that it is among the largest holders of coal reserves in the US and its reserves are sufficient to support over 100 years of production at its current production level.

This content is provided by Coaltrans Conferences for informational purposes only, and it reflects the market and industry conditions and presenter’s opinions and affiliations available at the time of the presentation.

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