Westmoreland Announces Shift to Reclamation at Jewett Following Cancellation of Supply Contract at Year End
August 24 2016 - 10:10AM
Westmoreland Coal Company (Nasdaq:WLB) announced today
that NRG Texas Power (NRG) has provided notice that it will
terminate the lignite supply agreement at the Jewett mine two years
early on December 31, 2016. Westmoreland will conduct the
multi-year reclamation work for NRG following the conclusion of the
supply contract.
“As NRG has decided to fuel its plant differently in response to
current energy market conditions, we are shifting our focus to
providing multi-year reclamation services. We have an
outstanding track record of operating the Jewett mine safely and
cost efficiently and plan to build on this performance during the
reclamation phase,” said Kevin Paprzycki, Chief Executive Officer
of Westmoreland Coal Company.
The lignite supply contract with NRG is a cost plus contract
which accounts for approximately 2% of Westmoreland’s 2016 adjusted
EBITDA guidance. Westmoreland expects to maintain positive
cash flow generation at Jewett during the next several years with
the cost plus arrangement continuing through reclamation. NRG
is responsible for the reclamation liability so Westmoreland does
not foresee using cash net of reimbursements for reclamation.
About Westmoreland Coal Company
Westmoreland Coal Company is the oldest independent coal company
in the United States. Westmoreland’s coal operations include
surface coal mines in the United States and Canada, underground
coal mines in Ohio and New Mexico, a char production facility, and
a 50% interest in an activated carbon plant. Westmoreland
also owns the general partner of and a majority interest in
Westmoreland Resource Partners, LP, a publicly-traded coal master
limited partnership (NYSE:WMLP). Its power operations include
ownership of the two-unit ROVA coal-fired power plant in North
Carolina. For more information, visit
www.westmoreland.com.
Cautionary Note Regarding Forward-Looking
Statements
Forward-looking statements are based on Westmoreland’s current
expectations and assumptions regarding its business, the economy
and other future conditions. Because forward-looking
statements relate to the future, they are subject to inherent
uncertainties, risks and changes in circumstances that are
difficult to predict. Actual results may differ materially
from those contemplated by the forward-looking statements.
Westmoreland cautions you against relying on any of these
forward-looking statements. They are statements neither of
historical fact nor guarantees or assurances of future
performance. Important factors that could cause actual
results to differ materially from those in the forward-looking
statements include political, economic, business, competitive,
market, weather and regulatory conditions.
Any forward-looking statements made by Westmoreland in this news
release speak only as of the date on which it was made.
Westmoreland undertakes no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future developments or otherwise, except as may be required by
law.
For further information, please contact
Gary Kohn, Vice President Investor Relations
1-720-354-4467
gkohn@westmoreland.com