CONSOL Energy Clarifying Statement on Guidance
28 October 2005 - 10:34AM
PR Newswire (US)
PITTSBURGH, Oct. 27 /PRNewswire-FirstCall/ -- CONSOL Energy
previously disclosed its intention to use the $420 million in
proceeds from the sale of a portion of CNX Gas Corporation to
accelerate certain capital projects and possibly to consider
acquisitions. The guidance issued today regarding capital
expenditures for 2006 and 2007 reflects previously disclosed
capital expenditures guidance plus additional expenditures that the
company may make. The company did not adjust previous production
and DD&A guidance to reflect the impact of the discretionary
additional expenditures. The company expects to make that
adjustment in January 2006 after a final capital budget and long
range plan are approved. The additional capital ($192 million in
2006 and $363 million in 2007) included in today's release is to be
understood as discretionary. President and Chief Executive Officer
J. Brett Harvey said, with the exception of capital required to
maintain production, that the decision to spend capital on mining
projects is balanced against other uses of the cash such as
acquisitions, increases in the dividend, or the repurchase of the
company's common stock based upon the best use of available funds.
He noted that current market fundamentals for coal and gas are
strong and that investments in efficiency or expansion projects are
expected to produce favorable rates of return. CONSOL Energy Inc.,
through its subsidiaries, is the largest producer of high-Btu
bituminous coal in the United States. CONSOL Energy has 17
bituminous coal mining complexes in six states. In addition, the
company is a majority shareholder in one of the largest U.S.
producers of coalbed methane, CNX Gas Corporation. CONSOL Energy
Inc. has annual revenues of $2.8 billion. The company was named one
of America's most admired companies in 2005 by Fortune magazine. It
received the U.S. Department of the Interior's Office of Surface
Mining National Award for Excellence in Surface Mining for the
company's innovative reclamation practices in 2002 and 2003. Also
in 2003, the company was listed in Information Week magazine's
"Information Week 500" list for its information technology
operations. In 2002, the company received a U.S. Environmental
Protection Agency Climate Protection Award. Additional information
about the company can be found at its web site:
http://www.consolenergy.com/. Forward-Looking Statements CONSOL
Energy is including the following cautionary statement to make
applicable and take advantage of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995 for any
forward-looking statements made by, or on behalf of, CONSOL Energy.
With the exception of historical matters, any matters discussed are
forward-looking statements (as defined in Section 21E of the
Exchange Act) that involve risks and uncertainties that could cause
actual results to differ materially from projected results. You can
identify these statements by forward-looking words such as "may,"
"will," "expect," "anticipate," "believe," "guidance," "forecast,"
"estimate," "intend," "predict," and "continue" or similar words.
These risks, uncertainties and contingencies include, but are not
limited to, the following: * the disruption of rail, barge and
other systems which deliver our coal, or pipeline systems which
deliver our gas; * our inability to hire qualified people to meet
replacement or expansion needs; * the risks inherent in coal mining
being subject to unexpected disruptions, including geological
conditions, equipment failure, fires, accidents and weather
conditions which could cause our results to deteriorate; *
uncertainties in estimating our economically recoverable coal and
gas reserves; * risks in exploring for and producing gas; *
obtaining governmental permits and approvals for our operations; *
a loss of our competitive position because of the competitive
nature of the coal industry and the gas industry, or a loss of our
competitive position because of overcapacity in these industries
impairing our profitability; * a decline in prices we receive for
our coal and gas affecting our operating results and cash flows; *
the inability to produce a sufficient amount of coal to fulfill our
customers' requirements which could result in our customers
initiating claims against us; * reliance on customers extending
existing contracts or entering into new long-term contracts for
coal; * reliance on major customers; * our inability to collect
payments from customers if their creditworthiness declines; * coal
users switching to other fuels in order to comply with various
environmental standards related to coal combustion; * the effects
of government regulation; * our inability to obtain additional
financing necessary in order to fund our operations, capital
expenditures, potential acquisitions and to meet our other
obligations; * the incurrence of losses in future periods; * the
effects of mine closing, reclamation and certain other liabilities;
* our ability to comply with restrictions imposed by our senior
credit facility; * increased exposure to employee related long-term
liabilities; * lump sum payments made to retiring salaried
employees pursuant to our defined benefit pension plan; * the
outcome of various asbestos litigation cases; * our ability to
comply with laws or regulations requiring that we obtain surety
bonds for workers' compensation and other statutory requirements; *
results of class action lawsuits against us and certain of our
officers alleging that the defendants issued false and misleading
statements to the public and seeking damages and costs; * our
ability to service debt and pay dividends is dependent upon us
receiving distributions from our subsidiaries; and * the
anti-takeover effects of our rights plan could prevent a change of
control. DATASOURCE: CONSOL Energy Inc. CONTACT: Thomas F. Hoffman
of CONSOL Energy Inc., +1-412-831-4060 Web site:
http://www.consolenergy.com/
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