A federal judge in Missouri has blocked a proposed joint venture between two of the world’s largest private coal companies: Peabody Energy and Arch Resources, Kallanish Energy reports.
The decision by U.S. District Judge Sarah Pitlyk backs an earlier decision by the Federal Trade Commission that said the proposed joint venture could not proceed because it would allow the companies to dominate the Powder River Basin coal market in Wyoming and Montana.
In June 2019, the two Missouri-based companies had proposed combining Peabody’s North Antelope Rochelle Mine and Arch Coal’s Black Thunder mine near Wright, Wyoming.
The FTC last February moved to block the deal. The state of Wyoming had supported the two companies.
Peabody said in a statement that it was disappointed in the decision.
The company said it will continue to mine low-cost Powder River Basin coal to compete against natural gas and subsidized renewables, said president and CEO Glenn Kellow in a statement.
Arch Coal announced that it has terminated the agreement with Peabody and will pivot to produce coal for steel and metallurgical markets and move away from thermal coal.
It is also intensifying its pursuit of strategic alternatives for its thermal assets, the company said.
No appeals are planned, the company said.
The Powder River Basin in 2019 produced 267 million tons of coal or about 40% of the U.S. total.
The two companies have five mines in the basin plus several in Colorado.
Coal mining companies are struggling as coal use declines due to natural gas and renewables.
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