Coal occupies the centre place in the energy sector. Thermal coal usage is heading back to the historical norms as the winters boosted it’s demand bringing it par with it’s supply. The use of the energy hasn’t multiplied but for the various reasons the price of coal are adamantly high.
Probably, metallurgical coal required in the production steel has driven the prices of coal. The high demand of coal in the developed countries is expected to bring met coal to a level of $200 if not $300.
Patriot Coal (PCX) recorded a 11% high in past week raining money on the shareholders inspite of the company suffering temporary bolt on its one of the most lucrative & largest mine.
The reason identified was the rumor of merger of PCX to another Appalachian coal company, which spread just because their representatives dint speak to media. Normally in case of mergers, the shares of the company acquiring goes down while the shares of the company acquired booms up. But the peculiarity of this case was that the share prices for both the companies shot up.
Well if this is not rumor and the companies really intend to enter into deal then a three way deal involving CONSOL (CNX) could be helpful. Central Appalachia sets out CONSOL which would send to Massey for cash and small plots of reserves, the Fola and the Buchanan County, Va., mines.
And thus the two giants can divide their assets north and south.
Media could not have got a better story.
It would be good for America if its firms get bigger and bigger in size because to make varieties of steel for infrastructure you need huge amount of met coal.Npower Home Energy offers electricity and gas, boiler installations & boiler repair.
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