December 21, 2010 / 10:40 PM / 9 years ago

UPDATE 1-Walter Energy buys coal shipping terminal

* Purchase from U.S. Steel’s unit

* Terms not disclosed

* Deal to increase port capacity, cut costs

Dec 21 (Reuters) - Metallurgical coal miner, Walter Energy WLT.N bought a shipping terminal in Alabama in a move to bulk up on coveted port capacity and lower costs, as it digests a recent deal that makes it a major player in the coal market.

Walter Energy, which has three coal projects in Alabama, bought the assets of Mobile River Terminal Co from a unit of U.S. Steel (X.N) for an undisclosed price.

“This acquisition will help ensure that we will have unconstrained shipping capacity to support our long-term coking coal production plans in Alabama,” interim Chief Executive Joe Leonard said in a statement.

The facility would help Walter maintain low mine-to-port costs and make it less reliant on third parties, Leonard said.

The facility is located less than four miles from the McDuffie Terminal where Walter Energy currently ships all of its coal to customers in South America and Europe.

Currently, Mobile River Terminal handles 3.2 million tons of iron ore, 1 million tons of furnace coke, and 0.5 million tons of other products annually, according to its website.

The acquisition comes three weeks after Walter signed a deal to buy Canada’s Western Coal WTN.TO for $3.3 billion putting it on track to become the world’s No. 3 producer of steel-making met coal at a time of booming demand. [ID:nLDE6B20EU] Since then Walter’s shares have gained 10 percent. They closed at $120.77 on Tuesday on the New York Stock Exchange. (Reporting by Savio D’Souza in Bangalore; Editing by Roshni Menon)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below