There are currently 14 active producing underground and surface mines on the approximately 126,000 acres of mineral estates being acquired, with 10 principal coal lessees operating the mines.
The coal is primarily steam coal that is consumed by major electric utilities and other industrial customers in the southeastern US, and approximately 75% of the expected production for the next five years is under permit.
Additionally, the oil and gas royalty interests to be acquired include 100% interests from 158 oil and gas wells.
To support the acquisition, Penn Virginia Resource GP, PVR’s general partner, has agreed to permanently forego $525,000 per year in incentive distributions otherwise payable by PVR to the general partner in connection with the acquisition.
The transaction is expected to close on or before year-end 2010 or early in the first quarter of 2011.
PVR owns and manages coal and natural resource properties and related assets, and owns and operates midstream natural gas gathering and processing businesses.
