LEXINGTON, Ky., July 10, 2012 /PRNewswire/ -- Rhino Resource Partners LP (NYSE: RNO) ("Rhino") today is providing an operational update of its second quarter activities.
- Northern Appalachia operations produced 477 thousand tons of steam coal during the second quarter. Coal sales were 476 thousand tons and limestone sales totaled 128 thousand tons.
- With Rhino's Hopedale sales fully contracted through 2014, Rhino has had discussions with some of its Hopedale customers about extending deliveries in order to provide a better match between current production and sales volumes.
- During the quarter, Central Appalachia operations produced 171 thousand tons of steam coal and 99 thousand tons of met coal. Met coal sales totaled 109 thousand tons and steam coal sales were 218 thousand tons.
- During June, the bulk of Rhino's Central Appalachia operations were idled to reduce excess inventory, primarily of met coal. During the month, overall inventories were reduced by approximately 75,000 tons and are now close to targeted levels. Production at the idled operations resumed on July 9.
- There was a pickup in met sales activity during the quarter, with 30 thousand tons sold on a spot basis as a low quality met product. Rhino's steam customers have generally been taking contracted deliveries.
- Rhino's Castle Valley operation produced 220 thousand tons and sold 251 thousand tons during the second quarter. During June, Castle Valley had its first 100 thousand ton plus sales month since Rhino began operations at this location, allowing this operation to reduce coal inventory by approximately 32 thousand tons.
- Rhino Eastern produced 98 thousand tons of met coal during the second quarter and sales were 92 thousand tons.
- Rhino Eastern's new Eagle #3 mine is prepared for production pending final regulatory approval. At full capacity, Eagle #3 is expected to produce at a rate of approximately 490 thousand tons per year.
- While the impact of the Patriot Coal Corporation bankruptcy filing on the Rhino Eastern joint venture is uncertain at this point, Rhino expects the joint venture will continue normal operations and does not expect the bankruptcy filing to have a material negative effect on Rhino Eastern.
- Rhino's new services company is nearing completion of construction of its first drill pad in the Utica region.
- At the end of June, borrowing under Rhino's $300 million bank line was approximately $171 million. Letters of credit outstanding were $27 million.
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