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CONSOL ENERGY

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About CONSOL ENERGY

CONSOL Energy consoles its customers with coal. CONSOL is one of the US's largest coal mining companies, along with Peabody Energy and Arch Coal. The company has some 4.5 billion tons of proved reserves, mainly in northern and central Appalachia and the Illinois Basin. CONSOL primarily mines high BTU coal, which burns cleaner than lower grades. Customers – more... include electric utilities and steel mills. CONSOL delivers coal using its own railroad cars, terminals, and barges (it maintains a fleet of 27 tow vessels and 620 barges). The company also engages in natural gas exploration and production; it controls 3.7 trillion cu. ft. of net proved natural gas reserves of gas, and operates more than 12,500 net wells.

Operations

In addition to its coal and gas businesses, CONSOL distributes mining and industrial supplies through its Fairmont Supply unit. About 40% of Fairmont's business is with its parent company.

In 2012 CONSOL, which treats more than 36 billion gallons of water annually, decided to form a water division to market its water resources, as well as its water treatment and management services. It is targeting gas producers in the Marcellus Shale fairway in need of fresh water and acid mine drainage sources. CONSOL also acquired a minority stake in Pennsylvania-based Epiphany Solar Water Systems to develop solar-powered water purification systems.

Financial Analysis

CONSOL's revenues grew by 17% in 2011 thanks to a 19% increase in coal revenues due to the successful renegotiation of several domestic thermal contracts, and higher prices for high metallurgical coal increased due to growing demand, both domestic and foreign. Other factors included a 0.4% increase in gas revenues thanks to higher volumes from additional wells drilled under its ongoing drilling program, and additional volumes from wells purchased in the Dominion Resources' Appalachian acquisition.

Net income grew by of 76% in 2011 thanks to higher revenues and an increase in other income ($153 million in 2011 compared to $97 million in 2010).

The company has seen year-over-year revenue increase from 2007 to 2011.

Strategy

Aware that most planned power plants will be gas-fired, CONSOL has diversified its energy holdings by acquiring additional natural gas reserves.

The company also sold its nonproducing Northern Powder River Basin assets for $170 million in cash to Cloud Peak Energy in 2012. Along with gains from other asset divestitures, CONSOL earned $224 million to use toward growth and maintenance projects.

 In 2010 it bought Dominion Resources' exploration and production assets for about $3.5 billion. The acquisition doubled CONSOL's natural gas reserves to 3 million cu. ft. Also in 2010, as a logical follow-up on the Dominion Resources deal, CONSOL acquired the remaining shares in CNX Gas that it did not already own (for $965 million) in order to consolidate its natural gas holdings.

To raise cash to pay down debt, in 2011 CONSOL agreed to sell a 50% stake in a joint venture with Noble Energy to develop 663,350 Marcellus Shale acres in Pennsylvania and West Virginia. Noble Energy agreed to pay CONSOL $3.4 billion for its 50% stake. Later in 2011 Hess Corporation agreed to pay up to $593 million for joint exploration and development rights to CONSOL's nearly 200,000 Utica Shale acres in Ohio. It also agreed to sell 7% in 115,647 net acres of Marcellus Shale to Antero Resources Appalachian Corp. for $193 million.

Ownership

BlackRock, T. Rowe Price Associates, and Wellington Management Company, own 12%, 11% and 10% of the company, respectively.

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CONSOL ENERGY Employer Reviews

Senior Administrator (Former Employee), Canonsburg, PASeptember 16, 2014
Completions Engineer (Former Employee), Waynesburg, PAAugust 9, 2014
Industrial Engineer (Former Employee), Canonsburg, PaAugust 5, 2014
Engineering Trainee (Former Employee), Waynesburg, PAJune 18, 2014
Management (Former Employee), Cameron, WVMay 22, 2014

CONSOL ENERGY Photos