This transaction supplements 40 million tons that PVR previously acquired in December 2002. Funding for the acquisition was provided by borrowings under PVR’s revolving credit facility.
In addition to the acquisition of the reserves, PVR will receive an increase in royalty of $1 per ton for the approximate 10 million tons of coal reserves remaining on the original transaction, plus a royalty on the newly-acquired reserves.
William Shea Jr, CEO of PVR’s general partner, said: “We are pleased to have expanded our coal reserve base in Northern Appalachia, one of the premier coal producing areas in the country, and to have increased the economic attractiveness of our coal royalty properties in this area. This acquisition is expected to be immediately accretive to distributable cash flow.”
Headquartered in Radnor, Pennsylvania, PVR manages coal and natural resource properties and related assets, and operates a midstream natural gas gathering and processing business.
