EVANSVILLE, Ind., April 20 /PRNewswire-FirstCall/ -- Vectren Fuels (Fuels), the wholly owned coal mining operations subsidiary of Vectren Corporation , has begun the process of opening two new underground mines near Vincennes, Ind. The first mine is expected to be fully operational by early 2009, with the second mine to open the following year. The southwestern Indiana mines will provide an estimated 425 local jobs to contract miners.
Both reserves are ideally located within 50 miles of eight coal-fired power plants and sit immediately adjacent to the CSX mainline railroad to easily serve neighboring facilities. Combined production is projected at five million tons annually, with the majority to be used at Vectren's A.B. Brown and F.B. Culley power plants in Posey and Warrick counties. This development will help replace the company's Cypress Creek surface mine in Boonville, Ind., whose reserves will be depleted within the next two to three years.
"This project allows Vectren to not only continue using Indiana coal to serve our customers in southwestern Indiana, but also provide a number of good jobs," said Vectren Chairman, President and CEO Niel Ellerbrook. "Our coal mining operations have been successful, and I'm confident this venture will continue that trend as recent advancements in clean-coal technologies for electric generation suggest continuing demand for coal."
The mineral rights for the reserves, which are estimated at 80 million tons of recoverable number-five coal at 11,200 BTU (British thermal units) and 6-pound sulfur dioxide, were purchased from Templeton Coal Company. The $125 million investment should begin production in the coming years as Fuels works to obtain permits and construct surface and underground facilities.
Once in production, the two new mines, combined with Fuels' existing underground mine, Prosperity, near Petersburg, Ind., will yield approximately eight million tons of coal per year. The combination of the new Vincennes- area mines and Prosperity places Fuels' total mining operations within 50 miles of 13 southwestern Indiana coal-fired generation facilities.
About Vectren
Vectren Corporation is an energy holding company headquartered in Evansville, Ind. Vectren's energy delivery subsidiaries provide gas and/or electricity to more than one million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren's nonutility subsidiaries and affiliates currently offer energy- related products and services to customers throughout the Midwest and Southeast. These include gas marketing and related services; coal production and sales; and energy infrastructure services. To learn more about Vectren, visit http://www.vectren.com/.
Safe Harbor for Forward Looking Statements
This document contains forward-looking statements, which are based on management's beliefs and assumptions that derive from information currently known by management. Vectren wishes to caution readers that actual results could differ materially from those contained in this document. Additional detailed information concerning a number of factors that could cause actual results to differ materially from the information that is provided to you is readily available in our annual report on Form 10-K filed with the Securities and Exchange Commission on Feb. 16, 2006.
