Peabody Energy
Encyclopedia
Peabody Energy Corporation , previously Peabody Coal Company, is the largest private-sector coal company in the world. The company is headquartered in Downtown St. Louis
Downtown St. Louis
Downtown St. Louis is the central business district of St. Louis, Missouri, the hub of tourism and entertainment, and the anchor of the St. Louis metropolitan area. The downtown is bounded by Cole Street to the north, the river front to the east, Chouteau Avenue to the south, and Jefferson Avenue...

, Missouri.

In 2006, Peabody sold over 247 million tons of coal
Coal
Coal is a combustible black or brownish-black sedimentary rock usually occurring in rock strata in layers or veins called coal beds or coal seams. The harder forms, such as anthracite coal, can be regarded as metamorphic rock because of later exposure to elevated temperature and pressure...

. The company's coal fuels approximately 10% of the electricity generated in the United States and 3% of electricity generated throughout the world. Peabody sells coal to over 350 electricity generating and industrial plants in 15 countries. As of December 31, 2006, the company had 10.2 billion tons of proven and probable coal reserves. It holds majority interests in 40 coal operations located throughout the United States and in Australia and Venezuela. In addition, Peabody owns minority interests in two mines through joint venture arrangements. In the United States, company-owned mines are located in Wyoming
Wyoming
Wyoming is a state in the mountain region of the Western United States. The western two thirds of the state is covered mostly with the mountain ranges and rangelands in the foothills of the Eastern Rocky Mountains, while the eastern third of the state is high elevation prairie known as the High...

, Colorado
Colorado
Colorado is a U.S. state that encompasses much of the Rocky Mountains as well as the northeastern portion of the Colorado Plateau and the western edge of the Great Plains...

, Arizona
Arizona
Arizona ; is a state located in the southwestern region of the United States. It is also part of the western United States and the mountain west. The capital and largest city is Phoenix...

, New Mexico
New Mexico
New Mexico is a state located in the southwest and western regions of the United States. New Mexico is also usually considered one of the Mountain States. With a population density of 16 per square mile, New Mexico is the sixth-most sparsely inhabited U.S...

, Illinois
Illinois
Illinois is the fifth-most populous state of the United States of America, and is often noted for being a microcosm of the entire country. With Chicago in the northeast, small industrial cities and great agricultural productivity in central and northern Illinois, and natural resources like coal,...

, and Indiana
Indiana
Indiana is a US state, admitted to the United States as the 19th on December 11, 1816. It is located in the Midwestern United States and Great Lakes Region. With 6,483,802 residents, the state is ranked 15th in population and 16th in population density. Indiana is ranked 38th in land area and is...

. Peabody's largest operation is the North Antelope-Rochelle Mine located in Campbell County, Wyoming, mining more than 97 million tons of coal in 2008 and will likely mine over 100 million tons of coal in 2009.

Peabody also previously owned coal mines in West Virginia
West Virginia
West Virginia is a state in the Appalachian and Southeastern regions of the United States, bordered by Virginia to the southeast, Kentucky to the southwest, Ohio to the northwest, Pennsylvania to the northeast and Maryland to the east...

 and Kentucky
Kentucky
The Commonwealth of Kentucky is a state located in the East Central United States of America. As classified by the United States Census Bureau, Kentucky is a Southern state, more specifically in the East South Central region. Kentucky is one of four U.S. states constituted as a commonwealth...

. The company spun off these assets into the independently-traded Patriot Coal Corporation
Patriot Coal Corporation
Patriot Coal Corporation is a coal-mining company based in St. Louis, Missouri. The company is a spin-off of most of the Eastern U.S.A. operations of Peabody Energy....

 in October 2007.

Peabody was Nos. 497 and 453 on the Fortune 500
Fortune 500
The Fortune 500 is an annual list compiled and published by Fortune magazine that ranks the top 500 U.S. closely held and public corporations as ranked by their gross revenue after adjustments made by Fortune to exclude the impact of excise taxes companies collect. The list includes publicly and...

 list of companies in 2005 and 2006, respectively. In 2008 Peabody Energy was named in Fortune Magazine's list of America's Most Admired Companies, ranking first in their sector in: Innovation, People Management, Social Responsibility, Financial Soundness, et al.

Early years (1883 – 1959)

The Peabody Energy company was originally founded as Peabody, Daniels & Company in 1883 by Francis Peabody, the son of a prominent Chicago lawyer, and a partner. The company bought coal from established mines and sold it to homes and businesses in the Chicago area. In the late 1880’s, Francis Peabody bought out his partner’s share of the business and the company was incorporated in the state of Illinois under the name Peabody Coal Company in 1890. In 1895, it began operations of its first mine in Williamson County, Illinois
Williamson County, Illinois
-2010:Whereas according to the 2010 U.S. Census Bureau:*92.7% White*3.8% Black*0.4% Native American*0.8% Asian*0.0% Native Hawaiian or Pacific Islander*1.7% Two or more races*0.4% Other races*2.0% Hispanic or Latino -2000:...

 and later expanded its operations in Illinois. In 1913, the company won its first long-term contract to supply Chicago Edison Company, the predecessor to utility Commonwealth Edison
Commonwealth Edison
Commonwealth Edison is the largest electric utility in Illinois, serving the Chicago and Northern Illinois area...

. The company’s growth continued after World War I
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...

 and the corporation went public for the first time in 1929 with a listing on the Midwest Stock Exchange and in 1949, was listed on the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...

.

Despite being ranked eighth among the country’s top coal producers in the mid 1950’s, Peabody began to lose market share to companies operating cost-efficient surface mining operations. To address the situation, it entered into merger talks with Sinclair Coal Company. A merger between the two companies occurred in 1955, resulting in the transfer of Peabody's headquarters to St. Louis, Missouri
St. Louis, Missouri
St. Louis is an independent city on the eastern border of Missouri, United States. With a population of 319,294, it was the 58th-largest U.S. city at the 2010 U.S. Census. The Greater St...

. The merged company retained the Peabody name. Under the leadership of chairman Russell Kelce, the company expanded production and sales.

1960–2000

In 1962, Peabody expanded into the Pacific with the opening of mining operations in Queensland, Australia. During this period Peabody also forged an equity partnership with the Japanese trading company Mitsui & Co., Ltd. and the Australian construction company Thiess Holdings. In 1968, the company was purchased by the Kennecott Copper Corporation. However, the U.S. Federal Trade Commission challenged the purchase as an antitrust violation. In 1976, the FTC ordered Kennecott to divest itself of Peabody. The newly-created Peabody Holding Company purchased the Peabody Coal business of Kennecott for $1.1 billion, and a consortium of companies controlled Peabody-Holding.

In the 1980s, Peabody expanded its operations in the Eastern United States, acquiring the West Virginia coal mines of Armco Inc in 1984. The company sought to broaden its metallurgical coal portfolio through the purchase of Eastern Gas and Fuel Associates’ seven West Virginia mines in 1987. Peabody also expanded westward, opening the North Antelope and Rochelle mines in the low sulfur Wyodak seam in the heart of Wyoming’s Powder River Basin
Powder River Basin
The Powder River Basin is a geologic region in southeast Montana and northeast Wyoming, about east to west and north to south, known for its coal deposits. The region supplies about 40 percent of coal in the United States. It is both a topographic drainage and geologic structural basin...

 in 1983 and 1984, respectively.

The passage of the Clean Air Act amendments in 1990 prompted the closure of some Peabody mines. However, other mines under its ownership were able to remain in operation due to the implementation of new equipment and procedures that reduced sulfur dioxide emissions. Stricter requirements outlined in Phase II of the legislation also prompted Peabody to invest in emissions reducing technologies. In 1990, the U.K.-based conglomerate Hanson plc, one of the owners of Peabody Holding at the time, bought out the rest of the owners.

In 1993, Peabody Energy expanded their holdings in the Pacific with the acquisition of three mines in Australia and subsequently developed a fourth operation in New South Wales. Peabody also expanded its operations domestically with acquisitions in New Mexico in 1993 and Wyoming in 1994 and assumed a stake in Black Beauty, a Midwest producer, in response to increased demand for metallurgical coal.

2001-Present

Following corporate ownership changes in the 1990s, the company filed an initial public offering
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...

 (IPO) in May 2001, and since this time it has operated as a publicly-traded company.

In 2002 Peabody launched its Peabody Energy Australia Coal Co. following the acquisition of the Wilkie Creek Mine in Queensland’s Surat Basin
Surat Basin
The Surat Basin is a part of the Great Artesian Basin of Australia. The Surat Basin extends across an area of 270,000 square kilometres and the southern third of the basin occupies a large part of northern New South Wales, the remainder is in Queensland. It comprises Jurassic through to Cretaceous...

. In October 2006, Peabody completed an acquisition of Excel Coal Limited, an independent coal company in Australia. Peabody paid $1.52 billion for Excel and also assumed $227 million of Excel's debt. At the time, Excel owned three operating mines and three development-stage mines in Australia. Additionally, Excel had an estimated 500 million tons of proven and probable coal reserves. As of 2011, Peabody's Australian mining operations are located in Queensland and New South Wales. Most of the company’s Australian production is metallurgical coal.

The company also advanced a number of coal-to-liquids and coal-to-gas projects to reduce emissions during the decade. On August 30, 2007, Ernie Fletcher
Ernie Fletcher
Ernest Lee "Ernie" Fletcher is a Republican politician from the U.S. state of Kentucky. In 1999, he was elected to the first of three consecutive terms in the United States House of Representatives; he resigned in 2003 after being elected the 60th governor of Kentucky and served in that office...

, the governor of the U.S. state of Kentucky
Kentucky
The Commonwealth of Kentucky is a state located in the East Central United States of America. As classified by the United States Census Bureau, Kentucky is a Southern state, more specifically in the East South Central region. Kentucky is one of four U.S. states constituted as a commonwealth...

 signed into state law a bill that will provide approximately $300 million in incentives to Peabody to build a coal gasification plant in that state. The resulting incentives were provisioned in the form of breaks on sales taxes, incentive taxes and coal severance taxes. In 2007, Peabody and a consortium of municipal electric cooperatives began construction on the 1600-megawatt Prairie State Energy Campus
Prairie State Energy Campus
Prairie State Energy Campus is a 1,600 megawatt base load, coal fired, electrical power station and coal mine under construction near Marissa, Illinois southeast of St. Louis, Missouri...

 clean coal project in Lively Grove, Illinois
Lively Grove, Illinois
Lively Grove is an unincorporated community in Washington County, Illinois, United States. Lively Grove is located on Illinois Route 153 northwest of Oakdale. Lively Grove is approximately from Elkton....

. The company now retains five percent equity stake in the project, which is expected to begin generating power for customers in 2011. At the 2010 World Energy Congress, Peabody CEO Gregory Boyce proposed a plan that advocated for the expanded use of coal worldwide, placing emphasis on geographic areas with limited or no access to electricity.

Areas of business

Peabody Energy’s world headquarters is in St. Louis, MO, and as of 2010 it also maintains offices in London, England; Beijing, China; Ulaanbaatar, Mongolia; Singapore
Singapore
Singapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...

; Brisbane
Brisbane
Brisbane is the capital and most populous city in the Australian state of Queensland and the third most populous city in Australia. Brisbane's metropolitan area has a population of over 2 million, and the South East Queensland urban conurbation, centred around Brisbane, encompasses a population of...

 and Sydney, Australia; and Jakarta, Indonesia. In the U.S. West, Peabody operates Powder River Basin operations in Wyoming as well as other mining operations in Arizona and New Mexico. Operations in the U.S. Midwest consist of mines in Indiana and Illinois. Peabody also operates a single underground mine in Colorado. All of these assets are occupied with the mining, preparation, and selling of coal to utility companies or steelmakers.

Peabody’s Australian operations consist of metallurgical and thermal coal mining operations in Queensland and New South Wales. Purchasers of its coal product include Australian utility companies or steel producers.

The Trading and Brokerage function is primarily concerned with the brokering of coal sales, trading coal, and freight or freight-related contracts. A smaller division of Peabody Energy deals with mining, export and transportation joint ventures, energy related commercial activities, and the management of Peabody’s operations and holdings. With growing demand for coal across Asian markets, especially in China, Indonesia, and India, Peabody has expanded its presence in Asia through offices in China, Mongolia, Indonesia, and Singapore.

Black Mesa controversy

In 1964 Peabody Energy (then Peabody Western Coal) signed a contract with the Navajo tribe
Navajo Nation
The Navajo Nation is a semi-autonomous Native American-governed territory covering , occupying all of northeastern Arizona, the southeastern portion of Utah, and northwestern New Mexico...

 and two years later with the Hopi
Hopi
The Hopi are a federally recognized tribe of indigenous Native American people, who primarily live on the Hopi Reservation in northeastern Arizona. The Hopi area according to the 2000 census has a population of 6,946 people. Their Hopi language is one of the 30 of the Uto-Aztecan language...

 tribe, providing the company with an unusually generous mineral lease
Mineral Leasing Act of 1920
The Mineral Leasing Act of 1920 et seq. is a United States federal law that authorizes and governs leasing of public lands for developing deposits of coal, petroleum, natural gas and other hydrocarbons, in addition to phosphates, sodium, sulphur, and potassium in the United States...

 as well as use of the plateau's water source. The contract was approved despite widespread opposition and the lack of clear authority of U.S. appointed tribal councils. The contract was negotiated by prominent natural resources attorney John Sterling Boyden, who claimed to be representing the Hopi tribe while actually on the payroll of Peabody as well.

Peabody Energy pumped potable water from the underground Navajo Aquifer in a slurry pipeline
Slurry pipeline
A slurry pipeline is used in mining to transport mineral concentrate from a mineral processing plant near a mine.- Overview :The concentrate of the ore is mixed with water and then pumped over a long distance to a port where it can be shipped for further processing. At the end of the pipeline, the...

 operation to transport extracted coal to its Mohave Generating Station in Laughlin, Nevada
Laughlin, Nevada
Laughlin is a census-designated place in Clark County, Nevada, United States, and a port located on the Colorado River. Laughlin is south of Las Vegas, located in the far southern tip of Nevada. It is best known for its gaming, entertainment, and water recreation. As of the 2010 census, the...

. The Navajo Aquifer (N-aquifer) is a main source of potable water for the Navajo and Hopi tribes, who use the water for farming and livestock maintenance as well as drinking and other domestic uses. The tribes have alleged that the pumping of water by Peabody Energy has caused contamination of water sources and a severe decline in potable water.

Environmental track record

Peabody Energy has been tagged as a major offender of environmental degradation. Peabody Energy has a long history of opposing efforts to mitigate the negative environmental effects of coal production and combustion. Peabody Energy was an active opponent of efforts to enact a strong Clean Air Act
Clean Air Act
A Clean Air Act is one of a number of pieces of legislation relating to the reduction of airborne contaminants, smog and air pollution in general. The use by governments to enforce clean air standards has contributed to an improvement in human health and longer life spans...

 in 1970, of acid rain provisions in the 1990 Clean Air Act
Clean Air Act
A Clean Air Act is one of a number of pieces of legislation relating to the reduction of airborne contaminants, smog and air pollution in general. The use by governments to enforce clean air standards has contributed to an improvement in human health and longer life spans...

 Amendments, and throughout the current efforts to significantly strengthen mercury
Mercury (element)
Mercury is a chemical element with the symbol Hg and atomic number 80. It is also known as quicksilver or hydrargyrum...

 provisions.
In a recent report from the National Coal Council, headed by many major executives of Peabody Energy, they called for more than doubling U.S. coal consumption by 2025.

In Newsweek
Newsweek
Newsweek is an American weekly news magazine published in New York City. It is distributed throughout the United States and internationally. It is the second-largest news weekly magazine in the U.S., having trailed Time in circulation and advertising revenue for most of its existence...

's 2009 Green Rankings, Peabody Energy was ranked #500 out of the top 500 largest US companies based on their negative environmental impact - they received a the lowest possible score of 1 out of a possible 100.

Reference in song

The environmental impact of Peabody Energy's surface mining operations in Muhlenberg County, Kentucky
Muhlenberg County, Kentucky
Muhlenberg County is a county located in the U.S. state of Kentucky. As of the 2010 Census, the population was 31,499. The county is named for Peter Muhlenberg. Its county seat is Greenville....

 is the subject of John Prine
John Prine
John Prine is an American country/folk singer-songwriter. He has been active as a recording artist and live performer since the early 1970s.-Biography:...

's 1971 song "Paradise
Paradise (John Prine song)
"Paradise" is a song written by John Prine for his father, and recorded for his 1971 debut album, John Prine. Prine also re-recorded the song for his 1986 album, German Afternoons. The song is about the impact of coal mining both while in activity and what happens to the area around the Green River...

". The company was forever immortalized in the song, popular on the bluegrass circuit, whose refrain goes this way:

And daddy won't you take me back to Muhlenberg County
Down by the Green River where Paradise lay?
Well, I'm sorry my son, but you're too late in asking...
Mister Peabody's coal train has hauled it away.

See also

  • Black Mesa Peabody Coal debate
    Black Mesa Peabody Coal debate
    The Black Mesa Peabody Coal controversy arose in the 1960s over a mineral lease in the Black Mesa plateau of the Four Corners region in the western United States...

  • List of United States electric companies
  • Harco, Illinois
    Harco, Illinois
    Harco is an unincorporated community in Saline County, Illinois, United States. The Harrisburg Colliery Coal Company Mine was sunk in November 1916, in the center of section 27, township 8, range 5, Saline County, Illinois, and the town of Harco soon grew up around it...


External links

The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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