The deal will include a combination of cash, tonnage-based royalty payments and reclamation obligations of $2.5m.

HKCC is said to have around 20 million tons of coal reserves in Russell and Buchanan counties, Virginia.

The company’s operations comprise high wall and deep mine reserves of hi-vol A and hi-vol B metallurgical coals and thermal coal.

SunCoke Energy will sell HKCC’s warehouse, two idled coal preparation and certain coal load out facilities.

SunCoke Energy chairman and CEO Fritz Henderson said: "Given the ongoing difficult coal price environment, we made the strategic decision early in 2014 to sell or downsize our coal mining operations.

"With their nearby coal mining activities and familiarity with our operations, Omega is a natural fit for this portion of our coal business."

Subject to regulatory approvals and other customary closing conditions, the transaction is expected to be completed in the first quarter of 2015.

SunCoke said it will evaluate downsizing plans for its coal mining business, while considering a sale of remaining coal mining operations.