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Union Pacific Railroad lands Peabody Energy contract to move coal from Colorado to Texas


Coal producer Peabody Energy and Kinder Morgan Energy Partners L.P. recently reached long-term agreements to secure and expand the Gulf Coast export platform for Peabody's Colorado, Powder River Basin and Illinois Basin coal products. In addition, Peabody Energy secured a rail service agreement with Union Pacific Railroad to transport the company's Colorado coal to Kinder Morgan's Houston terminals.

Under the multi-terminal agreements, Peabody Energy for the next eight to nine years would gain additional access to export coal at Kinder Morgan's Deepwater Terminal and Houston Bulk Terminal near Houston, and its International Marine Terminal in Myrtle Grove, La.

Kinder Morgan plans to invest about $400 million to expand its Gulf Coast terminal network. Peabody Energy expects to begin exporting Colorado and Powder River Basin coal products from the Deepwater facility beginning in 2014. Illinois Basin, Colorado and Powder River Basin coal will be exported through the Myrtle Grove terminal after 2014.
“Peabody is securing a large-volume, sustainable U.S. export platform to meet growing global seaborne coal demand," said Peabody Energy Chairman and Chief Executive Officer Gregory Boyce in a prepared statement.

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More News from 7/19/2012