Arch and CONSOL merge to create US$5.2bn global coal giant

NORTH AMERICAN coal companies Arch Resources and CONSOL Energy are combining in an all-stock merger to form a US$5.2bn mining giant.

Core Natural Resources will have the capacity to sell around 101m t/y of coal and run operations at 11 mines in the US’ largest coal producing states, including Wyoming, West Virginia, and Pennsylvania.

With coal demand in the US stagnant, the newly formed company is expected to mainly service international customers in steel, infrastructure, and energy.

Paul Land, CEO of Arch, said: “Core Natural Resources will enjoy the benefits of CONSOL’s growing seaborne thermal business focused on industrial applications coupled with Arch’s significant exposure to attractive global metallurgical coal markets.”

Global demand

Though US coal production increased year on year by 2.9% to 594m t in 2022, domestic consumption decreased by 5.5% in the same period.

Despite the US’ shrinking reliance, coal demand is booming internationally, mainly in China, where demand has increased by 6% to 276m t this year, and India, where it increased by 9.2% to 105m t.

Core Natural Resources will have access to export terminals on the US’ Eastern Seaboard, including CONSOL’s Baltimore Marine terminal, which processes and ships more than 10m t/y of coal to South America, Asia, and Europe. It will also have access to ports on the US’ West Coast and in the Gulf of Mexico.

The company’s main offerings will include metallurgical coal, which is mainly used to make coke for the steelmaking process, and thermal coal, which is also used for steelmaking and electricity generation.

The merger is expected to close by Q1 2025.