HENDERSON, Ky. − Coal mining is returning to Henderson County in a big way and with a proven company.
Alliance Coal LLC on Thursday morning announced that it will develop a new $35 million underground mine in southern Henderson County that will be part of its existing River View Mine complex in Union County.
Once in operation, River View Henderson Portal 1 will create 260 new jobs plus employ a certain number of miners who will be transferred from the existing River View operation. Wages are to average $34.50 per hour. Including benefits, compensation will average $49 an hour.
The new portal and man shaft will be located on 56 acres on the John Royster farm at the intersection of Kentucky 145 and Sulfur Springs Road near the community of Little Dixie.
Construction is expected to begin in April 2023 and be completed by December 2024.
“River View is excited to expand into Henderson County,” River View General Manager Bill Adelman said. “The coal industry has faced a lot of challenges in recent years, but this project allows us to continue to mine coal for the power producers who care about providing affordable and reliable electricity to homes and businesses,
“Kentucky has many state and local elected officials who have supported investment and growth in our commonwealth,” Adelman said. “We’re appreciative of their efforts, and the laws they’ve passed, that make expansion opportunities like this one more likely to happen. River View looks forward to what this project means for our miners and Henderson County.”
“Henderson County is thrilled to welcome River View Coal and Alliance Resource Partners to our community,” Henderson County Judge/Executive Brad Schneider said. “Our county has a long history of helping provide this country its most abundant and reliable energy source, coal, and it is exciting that we’ll soon be back in the business of powering America.
“And not only are we both grateful for, and ecstatic about, the new jobs and new capital investment this facility will bring here, we are just as thankful that this project means all the existing mining jobs at River View’s current portals in Union County will remain in the neighborhood,” Schneider said. “That means our brothers and sisters in surrounding counties who depend on these jobs to feed their families won’t have to worry about their futures. Their work will go on right here in Northwest Kentucky. It’ll just be a few more minutes down the road.”
“I applaud the investment by Alliance Coal and I am excited that coal mining will continue to be strong in NWKY for many years to come,” state Senator Robby Mills of Henderson said.
“River View Coal has been vested in the success of our communities for many years. It is great news that they are continuing to produce great paying jobs and making a huge investment in Henderson,” state Rep. Jonathon Dixon said.
River View began producing coal in 2009 and is now the largest underground room-and-pillar mine of its kind in North America. The existing operation includes a preparation plant on site with a throughput capacity of 2,700 tons of raw coal per hour. Currently, River View employs 783 people in Kentucky.
Alliance Coal also operates mines in Eastern and Western Kentucky, Indiana, Illinois and West Virginia.
The new 30,000-square-foot River View Henderson Portal 1 will be identical to the River View Portal 2 near Waverly in Union County, according to Missy Vanderpool, executive director of Henderson Economic Development, which assisted Alliance with this project.
Coal from the new mining operation will be transported through underground conveyors in the former Patriot Coal Co.’s Highland Mine, which Alliance acquired several years ago, to connect with River View’s operations in Union County, where the coal will surface before being conveyed to a terminal on the Ohio River near Uniontown.
Local and state financial incentives were offered to Alliance to encourage the investment in the new mining operation.
Henderson County Fiscal Court has agreed in principle to provide $1 million to assist with land acquisition for the portal. Those funds will be released when the mining operation opens, according to Schneider.
Also, fiscal court agreed to a 1/2% occupational tax waiver for 10 years for both new jobs and existing River View miners who are transferred from the Union County mine to the Henderson portal “so existing employees don’t get a pay cut,” he said. (Henderson County has a 1% occupational tax but agreed to roll it back to 1/2% to match Union County’s occupational tax.)
“It’s a pretty fair sum of money,” Schneider said of the tax waiver. “But what we get back in property taxes and coal severance will quickly pay it back” many times over.
“We’re more than pleased to make this investment,” he said.
Meanwhile, to encourage the investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) on Thursday preliminarily approved a 10-year incentive agreement with the company under the Kentucky Business Investment program. The performance-based agreement can provide up to $3.4 million in tax incentives based on the company’s investment of $35 million and annual targets of:
Creation and maintenance of 260 Kentucky-resident, full-time jobs across 10 years; and
Paying an average hourly wage of $49 including benefits across those jobs.
KEDFA also approved River View Coal for up to $300,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing.
By meeting its annual targets over the agreement term, the company can be eligible to keep a portion of the new tax revenue it generates. The company may claim eligible incentives against its income tax liability and/or wage assessments.
In addition, the company can receive resources from Kentucky’s workforce service providers. Those include no-cost recruitment and job placement services, reduced-cost customized training and job-training incentives.
Alliance Coal is a subsidiary of Tulsa-based Alliance Resource Partners LP (ARLP), the second-largest coal producer in the eastern United States and the largest in the Illinois Basin. In addition to coal, it generates revenue from oil and gas royalties.
For 2020, ARLP reported revenues of $1.57 billion, up 18.2% from the previous year. After expenses, it reported net income of $178.2 million, compared with a net loss of $129.2 million the previous year.
In early August, ARLP announced that its revenues had surged to a record $616.5 million in the second quarter of the year, up 70.1% from the same quarter last year on higher coal sales prices and volumes.
While many mines have closed in Western Kentucky have closed in recent years and production has plummeted as the cost of natural gas and other energy sources have become competitive, Schneider said Alliance’s announcement underscores coal’s continued importance.
“Power pinches around the world because of Ukraine and other factors make coal as important as ever before,” he said.
“Energy independence is as important as every was, and coal mining is a part of that, and no one is better at it than Alliance, in my opinion,” Schneider said.
“We have around 100 years of coal left in Henderson County, including around 30 years out of this portal. So they’ll be here quite a long time.”
Recent economic development announcements in Henderson County:
July 2021: Pratt Paper to build $600 million recycling and corrugated box complex, hire 320
April 2022: Columbia Sportswear to add 175 jobs at distribution center, invest $3.7 million
May 2022: Sitex Corp. to add 30 jobs with $4.5 million expansion
July 2022: Accuride Corp. to invest $2 million, add 15 jobs
July 2022: Hydro Aluminum to invest $15 million in recycling plant, preserve 47 jobs over 10 years
September 2022: Alliance Coal to open underground mine portal in rural Henderson County, hire 260 workers and transfer some from River View Mine in Union County
This article originally appeared on Henderson Gleaner: Henderson County lands Alliance Coal's newest mine, 260 jobs to come