Paso Diablo Mine
|This article is part of the CoalSwarm coverage of Venezuela and coal|
the Paso Diablo Mine, the largest coal mine in Venezuela, is owned and operated by Carbones del Guasare (CDG). Peabody Energy has a 48.37% interest in the joint venture. In 2010 it bought the 25.5% stake held by Anglo Coal and transferred 2% to the government-owned Carbones del Zulia S.A.
The mine is located near Paso Diablo in Zulia State in the Guasare coal basin and has a rated production capacity of 8 million tonnes a year.
Coal is trucked approximately 85 kilometres to the to an export barge loading terminal at Santa Cruz del Mara export terminal Mara which is owned by CDG. In a profile on mining in Venezuela, the Consulate General of Denmark states that "a floating storage and transfer station, the Bulk Wayuu, is permanently anchored in Lake Maracaibo to provide additional storage capacity and to perform an efficient ship loading operation. Coal is reclaimed from barges on to Bulk Wayuu and subsequently loaded, via a series of conveyors and discharge systems, into ocean-going vessels docked alongside this facility."
Peabody Energy, which refers to the mine as the Paso Diablo Mine, states on its website that the mine "is a 6.6 to 8.0 million ton-per-year surface operation that exports coal for electricity generators and steelmakers in North America and Europe. Paso Diablo utilizes the truck-shovel method to access approximately 175 million tonnes of reserves (in the current coal concession) in the Guasare coal basin ... Most coal travels approximately 90 kilometers to the port at Santa Cruz de Mara on Lake Maracaibo ... Peabody markets a proportional amount of the mine's output to customers of seaborne coal seeking high-Btu, low sulfur thermal coal for electricity generation and PCI coal for use in steel production."
Despite a production capacity of 8 million tonnes per annum, in its 2008 annual report Peabody Energy reported that "the Paso Diablo Mine produced approximately 4.8 million tons of steam coal in 2008 for export to the U.S. and Europe. During 2008, the Paso Diablo Mine contributed $5.7 million to segment Adjusted EBITDA in “Corporate and Other Adjusted EBITDA” and paid a dividend of $19.9 million. At December 31, 2008, our investment in Paso Diablo was $54.2 million."
Later in the report, the company explained that the reduced profit from its Venezuela interest was primarily caused by "trucking issues experienced earlier in the year, a temporary shortage of explosives and delays in receiving equipment, which impacted operations."
In its 2010 annual report Peabody stated that lower than expected financial performance originated from "lower productivity, higher operating costs and ongoing labor issues; in addition, we recognized a $34.7 million impairment loss on this investment."
Articles and resources
Related SourceWatch articles
- Peabody Energy, "Energizing the World: 2010 Annual Report", Peabody Energy, March 2011, page 25.
- Peabody Energy, "10K", Peabody Energy, March 2011, page 6. (Pdf)
- U.S. Geological Survey, "Venezuela - 2006", 2006 Minerals Yearbook, page 6.
- Consulate General of Denmark, "Mining in Venevuela", undated, accessed August 2011.
- Peabody Energy, "Paso Diablo Mine", Peabody Energy website, accessed July 2009.
- Peabody Energy, "2008 Annual Report", Peabody Energy, March 2009, page 21.
- Peabody Energy, "2008 Annual Report", Peabody Energy, March 2009, page 29.