Peabody

IEEFA Research

IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

Production Declining by as Much as 40 Million Tons; Prices Failing to Benefit Shareholders or Stimulate New Investment; Anemic Exports; Little or No Gain From Regulatory Relief; Increasingly Dim Employment Prospects

We’re out this morning with our annual outlook for U.S. coal markets, and the picture isn’t pretty. We see the potential for some short-lived strength in the current uptick for coal producers but the title of our assessment sums up the larger view: “Short-Term Gains Will Be Muted by Prevailing Weaknesses in Fundamentals.” You can […]

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As Texas Coal-Fired Power Plants Close, Powder River Basin Mines Are Losing Their Largest Customers

Trends Will Force Closures and Complicate Efforts by Alpha Natural Resources, Arch Coal and Peabody Energy to Work Their Way Out of Bankruptcy

CLEVELAND, Aug. 3, 2016 (IEEFA.org) — The Institute for Energy Economics and Financial Analysis today published a report detailing how Powder River Basin coal producers are losing their largest customers as Texas power producers turn increasingly to other sources of energy. The report, “Texas’ Outsize Role in the Decline of the Powder River Basin Coal […]

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The Federal Government’s Coal-Leasing Program Is Broken: Here’s How to Fix It

The Federal Government’s Coal-Leasing Program Is Broken: Here’s How to Fix It

Appoint a Price-Setting Commission; Ban Exports; Cancel Some Leases; Eliminate Self-Bonding; Mandate Set-Asides for Mine Clean-up and Miner Pensions; Require Twice-a-Year Audits; Assume Smaller Markets

It’s time for the U.S. to modernize how it manages its publicly owned coal reserves. That’s the essence of comments we’ve filed today with the Department of the Interior as it begins a review of its federal coal-leasing program in the Powder River Basin, a program that has been mismanaged for years at taxpayer expense […]

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Coal Won’t Solve the Energy Poverty Problem

Coal Won’t Solve the Energy Poverty Problem

Times Have Changed; Old Electricity-Generation Models Don’t Work Anymore

Coal-fired electricity is no longer the economy builder its proponents say it is. Time was when coal in fact did contribute to growth in many economies, but times have changed. Today governments and private interests worldwide concede—even emphasize—the economic and environmental dysfunction of coal. We’ve just published an IEEFA Briefing Note (“Energy Poverty, Then and […]

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If Peabody Is to Recover, It Must Close More Mines

If Peabody Is to Recover, It Must Close More Mines

The World’s Biggest Private-Sector Coal Company’s Current Turnaround Strategy Won’t Work

Peabody Energy, the largest private-sector coal-mining company in the world, is out with a dismal review today of its 2015 performance. The metrics unto themselves are damning, and Peabody’s plan for turning things around is even worse. In a report we’ve just published (with the Seattle-based Sightline Institute)—“Peabody’s Strategies for Survival Ignore Market Realities and Risks […]

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For U.S. Coal, Market Realities Grow Increasingly Harsh

For U.S. Coal, Market Realities Grow Increasingly Harsh

Debt Hurdles, Reclamation and Pension Challenges, Abandonment by Hedge Funds

We distributed a briefing note this week that delves into some of the many pressing difficulties confronting U.S. coal producers. In the note (“Struggling U.S. Coal Companies Face Debt Hurdles, Complications From Reclamation and Pension Obligations, Pressure from Hedge Funds”) we talk about how the cumulative impacts of the industry’s many mounting liabilities—reclamation costs, pension […]

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PEABODY ENERGY:  Management Is Rewarded as Investors Lose and Workers Are at Risk

PEABODY ENERGY: Management Is Rewarded as Investors Lose and Workers Are at Risk

Peabody Energy Management Is Rewarded as Investors Lose and Workers Are at Risk By David Schlissel, Director of Resource Planning Analysis, IEEFA

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2014 – Another Year of Unmet Promises for the Prairie State Energy Campus

2014 – Another Year of Unmet Promises for the Prairie State Energy Campus

2014 – Another Year of Unmet Promises for the Prairie State Energy Campus (pdf) By David Schlissel, Director of Resource Planning Analysis, Institute for Energy Economics and Financial Analysis

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Report: 20 Fourth-Quarter Questions for Powder River Basin Coal Producers

Report: 20 Fourth-Quarter Questions for Powder River Basin Coal Producers

20 Fourth-Quarter Questions for Powder River Basin Coal Producers (pdf) By Tom Sanzillo, Director of Finance, Institute for Energy Economics and Financial Analysis

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Memo: Analysis of Paducah Power System’s Recent and Future Cost of Power from the Prairie State Energy Campus

Memo: Analysis of Paducah Power System’s Recent and Future Cost of Power from the Prairie State Energy Campus

Memo: Analysis of Paducah Power System’s Recent and Future Costs of Power from the Prairie State Energy Campus By David Schlissel, IEEFA Director of Resource Planning Analysis

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More News and Commentary

IEEFA Guest Commentary: Peabody Must No Longer Be Self Bonded

IEEFA Guest Commentary: Peabody Must No Longer Be Self Bonded

‘Dodging Debt Obligations Through Bankruptcy Proceedings’

Wyoming’s Department of Environmental Quality is facing a critical decision regarding Peabody Energy and whether the company can continue to self-bond for its $728 million Wyoming coal mine cleanup obligation. Self-bonds are unsecured IOUs, uncollectable when a company hides under bankruptcy protection. Peabody is the nation’s largest coal company, and is going through Chapter 11 […]

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IEEFA Update: Shutdown of Navajo Generating Station Likely Blows a Hole in Peabody’s Bankruptcy Plan

IEEFA Update: Shutdown of Navajo Generating Station Likely Blows a Hole in Peabody’s Bankruptcy Plan

Company Seen as Unlikely to Meet its Production or EBITDA Projections; Fate of Plant Is Emblematic of Larger Shift

Bankrupt Peabody Energy is being dealt a fresh setback on news this week that owners of the coal-fired Navajo Generating Station don’t expect to keep the plant open past 2019. The 2,500-megawatt station in Northern Arizona is owned by a consortium of public and private utilities with significant service areas in several states. While Peabody […]

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More Opposition to Peabody’s Bankruptcy Reorganization Plan

Tracy Rucinsk for Reuters: Indiana and several environmental groups are objecting to a plan by Peabody Energy Corp to exit its $8 billion Chapter 11 bankruptcy, citing concerns over how the company will cover about $1 billion in future mine cleanup costs. Most creditors support the plan by the world’s largest private-sector coal company to […]

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As Peabody Comes Out of Bankruptcy, Little Clarity on Its $728 Self-Bonding Commitments in Wyoming

Heather Richards for the Casper Star-Tribune: The company’s court documents shed little light on what the coal behemoth will do about $728 million in self-bonds in Wyoming and $1.1 billion in self-bonds in a total of four states. The company promised it would follow the law post-bankruptcy but failed to provide details as to how […]

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Op-Ed: Taxpayers Gain if Federal Coal-Lease Reforms Stand

Meredith Fowlie for The Conversation: The federal coal program is supposed to manage vast federally owned coal reserves, which account for more than 40 percent of U.S. coal production, “for the benefit of current and future generations.” But the program has, for a long time, been criticized for selling taxpayers short. For this and other […]

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Peabody Shareholders Object to the Short End of the Stick

Taylor Kuykendall for SNL: Palmer, once Peabody’s senior vice president of government relations, filed a shareholder objection to the plan and a related disclosure statement in a detailed filing Jan. 20. In his objection, Palmer claims a plan to give management 10% ownership of the new Peabody by canceling the stock of existing shareholders is […]

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IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals
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IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

Production Declining by as Much as 40 Million Tons; Prices Failing to Benefit Shareholders or Stimulate New Investment; Anemic Exports; Little or No Gain From Regulatory Relief; Increasingly Dim Employment Prospects

We’re out this morning with our annual outlook for U.S. coal markets, and the picture isn’t pretty. We see the potential for some short-lived strength in the current uptick for coal producers but the title of our assessment sums up the larger view: “Short-Term Gains Will Be Muted by Prevailing Weaknesses in Fundamentals.” You can […]

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U.S. Trustee Objects to ‘Exorbitant’ Fees in Peabody Bankruptcy Case

Tracy Rucinski for Reuters: The U.S. government’s bankruptcy watchdog objected on Wednesday to certain parts of Peabody Energy Corp’s plan to slash $5 billion of debt and exit Chapter 11, calling a proposed $240 million in transaction fees “exorbitant,” court papers showed. Peabody Energy, the world’s largest private sector coal producer, has proposed a $750 […]

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IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

Production to Decline by as Much as 40 Million Tons; Prices Will Not  Benefit Shareholders or Stimulate New Investment; Anemic Exports; Few Gains From Regulatory Relief; Increasingly Dim Employment Prospects

Jan. 19, 2016 (IEEFA.org) – The Institute for Energy Economics and Financial Analysis (IEEFA) today published its U.S. Coal Outlook 2017 in which it describes an industry like to decline further this year, though at a slower pace than in 2016. The report—“IEEFA U.S. Coal Outlook 2017:  Short-Term Gains Will Be Muted by Prevailing Weaknesses […]

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Rancor Among Stockholders at Peabody’s Reorganization Plan

Taylor Kuykendall for SNL: The ad hoc committee of non-consenting creditors claims the plan would allow Peabody and its “noteholder co-proponents” to “inappropriately shift value to themselves at the expense of nearly every other stakeholder in the debtors’ capital structure.” The committee said the plan will allow those who helped negotiate the plan to benefit […]

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