A new regulatory filing shows Foresight Coal Sales and East Kentucky Power Cooperative have extended a 2015 coal supply agreement through 2019 at reduced tonnages and prices during the last two years of the deal.
For the first three years of the contract, Foresight supplied 240,000 st/year to the 1,371-MW Spurlock plant in Mason County, Kentucky, at prices ranging from $46.50/st to $50.50/st FOB, based on the filing with the Kentucky Public Service Commission. The coal was sourced from Foresight's underground mines in Illinois.
But starting this year and running through 2019, Foresight is to ship 120,000 st/year to at a firm price of $34.25/st FOB barge, the filing shows, based on a heat content of 11,300 Btu/lb at Sitran Dock.
The contract calls for price adjustments for coal with higher and lower heat contents. This year East Kentucky will pay an adjusted price of $34.86/st for 11,500 Btu/lb coal and $33.64/st for 11,100 Btu/lb coal.
Foresight's coal can come from several Illinois mines: Williamson Energy's Mach No. 1 longwall mine near Marion; the M-Class No. 1 longwall mine near Akin in Franklin County; the Shay No. 1 continuous miner operation in Macoupin County; and the Deer Run, or Hillsboro, longwall mine in Montgomery County.
Deer Run has been idled for more than two years, however, and it is uncertain if and when it will resume production.
