Consol celebrates 150 years - WOWK 13 Charleston, Huntington WV News, Weather, Sports

Consol celebrates 150 years

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Pittsburgh-based coal and natural gas producer Consol Energy is celebrating its 150th anniversary of active mining operations this year.

Through expansion, acquisition and innovation, the company survived The Great Depression, World War II and the many other obstacles that the industry has presented the company with since the very beginning.

Beginnings and Coal Production

The company was founded as Consolidation Coal Co. in 1860 by several western Maryland coal operators who consolidated their holdings; but the Civil War delayed operation until April 1864.

During World War II, Consolidation Coal supplied coal energy for transportation and home heating needs, and was then merged with the Pittsburgh Coal Co. following the war in 1945, shifting its base operations to Pennsylvania.

By the mid-1970s, Consolidation Coal operated 56 mines at its peak — numbers that steadily declined. Still, the company continued to open the largest underground coal mine complex, Bailey, in southwestern Pennsylvania, in 1984.

And despite the decline in coal use over the last several decades, in 2011, Consol’s Buchanan mine set a new production record, mining 5.7 million tons of high grade metallurgical coal for the year.

Natural Gas and Acquisitions

After the war, coal became less popular as a heating source, being primarily replaced in the Northeast by cheaper natural gas. But oil interests soon began taking over major U.S. coal companies in reaction to the emergence of OPEC in the 1970s and a dramatic increase in oil prices. Slightly ahead of the trend, Consolidation Coal was acquired by Continental Oil Co., or Conoco Inc., in 1966.

In 1981, American chemical company DuPont acquired Conoco and Consolidation Coal, splitting its oil and coal assets into separate subsidiaries, and selling some Pennsylvania mining interests to RWE A.G., a German electric utilities company. Then, a decade later, DuPont and RWE formed Consol Energy Inc. as a joint venture.

Consol soon found itself on the other end of the deal when it acquired Dominion Resource’s Appalachian Exploration and Production Business in 2010, which tripled the company’s Marcellus Shale gas holdings to approximately 750,000 acres.

The following year, Consol formed partnerships with Houston-based Noble Energy to jointly develop 628,000 acres in Marcellus Shale, and with Hess Corp., which is headquartered in New York City, to explore for and develop oil, liquids and gas on 200,000 acres of Utica Shale in Ohio.

Innovation and Today

Consol followed an innovative path very early on.

In 1958, Consolidation Coal established the first independent research and development facility dedicated to coal extraction and production. The company began extracting coal-bed methane prior to mining as a way to enhance mining safety and productivity in 1980; CBM production accounts for about 7 percent of the total dry gas production in the U.S.

CNX Ventures, a subsidiary of Consol, then formed a joint venture in 2001 with Allegheny Energy Supply Co. to build an 88-megawatt, CBM-fueled power generating facility in southwestern Virginia.

Today, the company’s coal production has significantly decreased since its peak, currently operating 12 bituminous mining complexes across Pennsylvania, West Virginia, Virginia and Utah. Consol’s premium coal assets are sold to electricity generators and steelmakers domestically and internationally.

On the natural gas front, however, the company has operated nearly 13,000 net producing wells, and has access to 5.7 trillion cubic feet of natural gas reserves, including coal-bed methane and shale beds.