One of the world’s oldest coal companies is selling off the business that gave Consol Energy Inc. its name, giving up five West Virginia mines and its river transport arm in an effort to transform into a growth-oriented gas business.
After weeks of speculation, Cecil-based Consol confirmed it is selling its Consolidation Coal Co. subsidiary to an Ohio mining competitor in a deal that includes $850 million in cash. The company will keep five mines to help supply overseas demand and use the capital it’s freeing up to reinvest in exploration and production of shale gas.
“We’ve kept the jewels for our shareholders,” CEO J. Brett Harvey said. “It’s important for you to understand that.”
Harvey said Consol retained an advantage over drilling competitors by retaining what it considers its best coal assets. The five mines it will hold, including its Pennsylvania operations, can supply both electric and metals makers, allowing it to sell at the best price and get more money to keep growing gas production by 30 percent annually, Consol executives said.