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6/16/2011
Rail News: HomePage
CN to sell IC RailMarine Terminal's assets to Raven Energy
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Today, CN announced it reached a definitive agreement to sell substantially all of IC RailMarine Terminal Co.’s assets to Raven Energy L.L.C. for $73 million.
An indirect CN subsidiary, IC RailMarine Terminal is located on the east bank of the Mississippi River in Convent, La., west of New Orleans. The terminal stores and transfers bulk commodities and liquids between trains, ships and barges.
CN expects to close the transaction in about 45 days, pending regulatory approvals. After closing, the Class I plans to enter into a 10-year rail transportation agreement with Savatran L.L.C. — which, like Raven Energy, is owned by Foresight Energy L.L.C. and the Cline Group — to haul coal from four Illinois mines to the Convent transfer facility. Savatran would ship a minimum annual volume of coal via CN.
The sale and long-term coal transportation agreement are among initiatives that will enable CN “to make better use of its southern rail corridor while expanding its participation in the growing export of Illinois Basin coal,” said Luc Jobin, CN’s executive vice president and chief financial officer, in a prepared statement.
Foresight Energy plans to expand the Convent facility’s annual export coal capacity from 4 million tons to 8 million tons. There is the potential for an additional 8 million-ton expansion “as market conditions warrant,” Foresight Energy officials said.
“The acquisition of these terminal assets, as well as the signing of the transportation agreement with CN, is an important next step in our continuing investment in infrastructure assets that provide transportation and market optionality for our low-cost coal mining operations,” said Foresight Energy Chief Executive Officer Michael Beyer.
An indirect CN subsidiary, IC RailMarine Terminal is located on the east bank of the Mississippi River in Convent, La., west of New Orleans. The terminal stores and transfers bulk commodities and liquids between trains, ships and barges.
CN expects to close the transaction in about 45 days, pending regulatory approvals. After closing, the Class I plans to enter into a 10-year rail transportation agreement with Savatran L.L.C. — which, like Raven Energy, is owned by Foresight Energy L.L.C. and the Cline Group — to haul coal from four Illinois mines to the Convent transfer facility. Savatran would ship a minimum annual volume of coal via CN.
The sale and long-term coal transportation agreement are among initiatives that will enable CN “to make better use of its southern rail corridor while expanding its participation in the growing export of Illinois Basin coal,” said Luc Jobin, CN’s executive vice president and chief financial officer, in a prepared statement.
Foresight Energy plans to expand the Convent facility’s annual export coal capacity from 4 million tons to 8 million tons. There is the potential for an additional 8 million-ton expansion “as market conditions warrant,” Foresight Energy officials said.
“The acquisition of these terminal assets, as well as the signing of the transportation agreement with CN, is an important next step in our continuing investment in infrastructure assets that provide transportation and market optionality for our low-cost coal mining operations,” said Foresight Energy Chief Executive Officer Michael Beyer.
