(By Balachander) CONSOL Energy Inc. (NYSE:CNX), a producer of coal and natural gas, forecast a loss for the third quarter, citing a combination of marketing and operational issues.
"While precise figures are not yet available, it is clear that the company's previously announced planned and unplanned mine idlings took their toll on third quarter earnings," commented CFO William Lyons.
During the last several months, the company announced a planned two-week idling of Blacksville Mine and a one-week idling of Robinson Run Mine, due to weak thermal coal markets. The company had last month announced the idling of its premier low-vol Buchanan Mine for an estimated 30-60 days.
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Consequently, CONSOL said it suffered the failure of two new conveyor belts at the Bailey Preparation Plant, which hit output at the Enlow Fork and Bailey mines.
Meanwhile, the company's Gas Division, in the Ohio Utica Shale joint venture with Hess Corp. (NYSE:HES), reported an exploratory success from a well drilled in Stock Township, Noble County, Ohio. The division produced 39.5 Bcf for the third quarter ended September, down slightly from the 40.4 Bcf produced in the same period of last year. It expects production to be 42.5 – 44.5 Bcf for the fourth quarter.
CONSOL's Coal Division produced 11.6 million tons during the quarter, including 0.8 million tons of low-vol metallurgical and mid-vol coal from the company's Buchanan and Amonate Mines. For the fourth quarter, the unit is expected to produce 13.4 – 13.8 million tons, including 0.6 million at the Buchanan Mine, which is expected to re-start on the week of November 5 .
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The stock, which has been trading in the 52-week range of $26.41 to $46.90, closed at $35.14 on Friday.