Sunday, September 2, 2007

International Coal Group Inc ICO

International Coal Group Inc ICO

International Coal Group, Inc. (ICG), incorporated in March 2005, produces coal in Northern and Central Appalachia with a range of mid to high British thermal unit (Btu), low to medium sulfur steam and metallurgical coal.
The Company's Appalachian mining complexes, which include 10 of its mining complexes, are located in West Virginia, Kentucky and Maryland. The Company also has a complementary mining complex of mid to high sulfur steam coal located in the Illinois Basin. The Company markets its coal to a diverse customer base of investment grade electric utilities, as well as domestic and international industrial customers. As of December 31, 2006, ICG owned or controlled approximately 317 million tons of metallurgical quality coal reserves and approximately 746 million tons of steam coal reserves.
Further, the Company owns or controls approximately 566 million tons of non-reserve coal deposits. The Company operates through three segments: Central Appalachian, comprised of both surface and underground mines, Northern Appalachian, comprised of both surface and underground mines, and Illinois Basin, representing one underground mine.

As of December 31, 2006, ICG operated a total of 13 surface and 12 underground coal mines located in Kentucky, Maryland, West Virginia and Illinois. Approximately 66% of the Company's production has come from surface mines, and the remaining production has come from its underground mines. These mining facilities include eight preparation plants, each of which receive, blend, process and ship coal that is produced from one or more of its 25 active mines.

Northern and Central Appalachian Operations

The mines in Central Appalachia produced 11.2 million tons of coal, during the year ended December 31, 2006, and the mines in Northern Appalachia produced 3.2 million tons of coal, in 2006. Shipments to electric utilities, accounted for approximately 95% of the coal shipped, in 2006.

ICG Eastern, LLC operates the Birch River surface mine in Webster County, West Virginia. Birch River is extracting coal from five distinct coalbeds: Freeport; Upper Kittanning; Middle Kittanning; Upper Clarion, and Lower Clarion. Approximately 81% of the coal reserves are leased, while approximately 19% are owned in fee.

ICG Hazard, LLC comprises two mining complexes: ICG Hazard and Flint Ridge, which together operate six surface mines, two underground mines, a unit train loadout (Kentucky River Loading), a preparation plant (Flint Ridge Plant) and other support facilities in eastern Kentucky, near Hazard.

ICG Hazard's five surface mines include East Mac & Nellie, Vicco, Rowdy Gap, Tip Top and Thunder Ridge. The coal from these mines is being extracted from the Hazard 11, Hazard 10, Hazard 9, Hazard 8, Hazard 7 and Hazard 5A seams. Nearly all of the coal is marketed run-of-mine. Approximately 99.2% of Flint Ridge's reserves are leased, while 0.8% are owned in fee.

ICG Knott County, LLC operates five underground mines, the Supreme Energy and Raven preparation plants and rail loadouts and other facilities necessary to support the mining operations in eastern Kentucky, near Kite. ICG Knott County is producing coal from the Hazard 4, Elkhorn 2 and Elkhorn 3 coalbeds.
Three mines are operating in the Hazard 4 coalbed: Calvary, Clean Energy and Elk Hollow. The Raven and Classic mines are operating in the Elkhorn 2 and Elkhorn 3 coalbeds, respectively. Approximately 26% of ICG Knott County's reserves are owned in fee, while approximately 74% are leased.

ICG East Kentucky, LLC is a surface mining operation located in Pike County, Kentucky, near Phelps. ICG East Kentucky operates the Blackberry surface mine and the Phelps Loadout.
Blackberry is an area surface mine that produces coal from four separate coalbeds: Taylor; Fireclay, Lower Fireclay and Hamlin
Vindex Energy Corporation operates three surface mines, the Carlos mine, the Douglas mine and the Jackson Mountain mine, all located in the Potomac Basin in Garrett County, Maryland.

In 2006, the Company commenced operations at the Carlos mine and idled the Island mine in 2006. Vindex Energy Corporation is a cross-ridge mining operation extracting coal from the Upper Freeport, Bakerstown, Middle Kittanning, Upper Kittanning, Pittsburgh and Redstone seams.

Patriot Mining Company consists of two active surface mines: Crown No. 4 and New Hill East both located near Morgantown in Monongalia County, West Virginia.

Wolf Run Mining Company's Buckhannon Division consists of two active underground mines: the Sago mine and the Imperial mine, both located in Upshur County, West Virginia, near the town of Buckhannon.
Both mines extract coal from the Middle Kittanning seam. Wolf Run Mining Company's Philippi Development Division operates the Sentinel mine in Barbour County, West Virginia near the town of Philippi.
Sycamore Group consists of The Sycamore Group LLC and the Harrison Division. The Sycamore Group LLC is a joint venture between ICG and Emily Gibson Coal Company.

The joint venture, through an independent contract miner, operates one underground mine, the Sycamore No. 1 Mine, in Harrison County, West Virginia.
The Hillman property, located in Northern Appalachia, includes approximately 186 million tons of deep coal reserves in the Lower Kittanning seam located predominantly in Taylor County, West Virginia, near Grafton. ICG owns the Hillman coal reserve and the non-reserve coal deposits in the Kittanning, Freeport, Clarion and Mercer seams on the Hillman property.

The Upshur Property, located in Northern Appalachia, contains approximately 93 million tons of non-reserve coal deposits owned or controlled by ICG in the middle and lower Kittanning seams. The Company's Big Creek reserve, located in Central Appalachia, covers 10,000 acres of leased coal lands located north of the town of Richlands in Tazewell County, Virginia.
Total recoverable reserves are 27.5 million tons in the Jawbone, Greasy Creek and War Creek seams. The Big Creek reserve is all leased from Southern Regional Industrial Realty.
The Beckley Pocahontas mine located in Central Appalachia, is a 29 million-ton deep reserve of metallurgical coal in the Pocahontas No. 3 seam in Raleigh County west of Beckley, West Virginia. The southwest portion of the reserve underlies part of the closed BayBeck Mine in the Beckley seam.
Most of the 16,800 acre Beckley reserve is leased from three land companies: Western Pocahontas Properties, Crab Orchard Coal Company and Beaver Coal Company. The Jennie Creek reserve, located in Mingo County, West Virginia, is a 44.9 million ton reserve of surface and deep mineable steam coal

Illinois Basin Mining Operations

ICG Illinois, LLC operates one underground coal mine, the Viper mine, in central Illinois. The Viper Mine mines the Illinois No. 5 Seam, also referred to as the Springfield Seam. Approximately 61% of the coal reserves are leased, while 39% is owned in fee. Shipments to electric utilities account for approximately 58% of coal sales.
Other Operations

ADDCAR is the registered trademark of ICG, Inc. In ADDCAR highwall mining system, there is a launch vehicle, continuous miner, conveyor cars, a stacker conveyor, electric generator, water tanker for cooling and dust suppression and a wheel loader with forklift attachment. CoalQuest has entered into a joint operating agreement pursuant to which it will seek to produce coalbed methane, which is pipeline quality gas that resides in coal seams, from its properties in Barbour, Harrison and Taylor counties in West Virginia.

The Company competes with Massey Energy Company, Arch Coal, Consol Energy, Alpha Natural Resources and Foundation Coal Holdings.