CONSOL Energy: Driven by Value

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CONSOL Energy is creating energy supply options well into the future.

“Let’s not talk about policy, let’s talk about values.”

It wasn’t the answer I expected from Jimmy Brock, President and CEO of CONSOL Energy, when asked about the company’s environmental policies. However, it shed light on the perception of the coal industry, and what that industry is doing to change how you view one of the U.S.’s most important energy sources.

“In a larger sense, and on a personal note, nearly all employees of CONSOL Energy live in the region where they mine and work,” he said. “Our kids drink the water and breathe this air. We all have a vested interest in ensuring that our activities do not adversely affect the environment. Compliance is one of our core values, but it’s also the personal reasons why environmental stewardship is paramount to us.”

Brock has been a part of the coal industry—and CONSOL Energy specifically—for four decades. He has a real passion for the work he does, and the company he does it for. Starting in 1978 as a summer student for the company, Brock has worked at nearly every position at the company: from laborer up through management to CEO today.

“It’s been a great journey for me. I’ve been lucky to be surrounded by some of the very best people. Accomplishments are rarely, if ever, achieved alone. I have a great team around me.”

It’s important to him and to the company that people understand the role that coals plays in their day-to-day life in the U.S. Coal today burns much cleaner than it did several decades ago. In fact, current state-of-the-art environmental control technologies, which have been widely deployed across the existing coal fleet, are capable of reducing emissions of sulfur dioxide, nitrogen oxides, and mercury to very low levels. For every MWh generated, the U.S. coal fleet emits 84 percent less sulfur dioxide and 75 percent less NOx than it did 20 years ago. 

“It’s one of the cheapest, most reliable types of energy to produce. It’s a source of electricity that supports a developed country’s way of life. However, the public still perceives it as a dirty and unsafe industry. We’re a tech-driven company in a tech-driven industry. People need to be educated: everyone knows how to turn a light switch on. Everyone needs to know why the light bulb works and stays on after that switch flips.”

CONSOL’S History

Before exploring how CONSOL Energy has helped evolve the coal market to one with an engrained sustainable conscience, it’s important to understand how CONSOL Energy became the company we know it to be today.

The coal business that CONSOL Energy runs today traces its roots back to Consolidation Coal Company in 1860, which delayed its coal operations until near the end of the Civil War in 1864. A defining characteristic of the brand since the beginning has been growth and acquisitions of other mining companies and their reserves, which took place for the first time in the early 1900s.

The Great Depression impacted the business, but it reorganized and restructured, emerging from the brink of bankruptcy at the end of the 1930s. Another war, this time WWII, led CONSOL Energy to aid the efforts by supplying coal to provide energy for transportation and home heating needs.

The industry saw marked shifts in the decades of the ’50s, ’60s, and ’70s. CONSOL again turned to expansion, this time both through acquisitions and expanding its existing operations. Mine safety improved during this time period, and a real intent on improving coal production and utilization came into focus.

The development of its Bailey Mine Complex in the ’80s and ’90s led to the creation of the largest underground mine complex in North America. The company also went public in this timeframe.

Currently, CONSOL Energy has 100 percent ownership of the CONSOL Marine Terminal in the Port of Baltimore for shipping coal to export markets. The company also owns a 90 percent economic ownership of the Pennsylvania Mining Complex—which includes the Bailey, Enlow Fork, Harvey Mines and related infrastructure—as well as 1.6 billion tons of undeveloped reserves outside of the Pennsylvania Complex.

Today’s makeup of assets at CONSOL Energy is thanks to a split by the company’s former parent with the same name in late 2017.

“The pre-spin CONSOL Energy was historically a coal company, but we opportunistically grew a gas business over the past decade,” said Brock. “That part of the business reached a point of critical mass and could stand and flourish on its own: the time was right for CONSOL Energy to return its focus purely to mining coal.”

The spin created two separate companies—CONSOL Energy for coal, and CNX Resources Corporation for gas.

One of the big determinants of the split was that a lot of investors weren’t quite sure what the previous CONSOL Energy’s focus was.

“Were we a coal company? A gas company? Did we favor one over the other? The spin got rid of that confusion, and made it easier for investors to invest in what they were interested in.  Now both companies can create their own destinies with management teams specifically dedicated to their discipline.”

Today’s CONSOL Energy

Brock believes that a bulk of CONSOL Energy’s success through good times and bad is thanks to remaining true to the company’s core values: safety, compliance, and continuous improvement.

“It’s made us what we are today,” he commented. “If we continue to focus on them, we’ll be just fine.”

The CEO stated several times that he and the company are most proud of its safety culture, which he describes not as a process, procedure, or policy, but a way of life.

“It’s the number one value and concern to each employee in the company. We understand that there will be sprains, strains, and minor injuries, but our goal every day is to have zero life altering accidents. Our safety performance is unparalleled and the root cause of our success.”

Not only did Brock say that a robust safety culture is morally the right thing to do, it has added tremendous benefits to the company. If no one is off work injured, then different people don’t have to be brought in to do the job. It means CONSOL Energy has the right, core qualified people running the technology and equipment.

It means the best of the best are helping CONSOL Energy build and further the success of its low-cost operation.

“The mine complex is highly capitalized with state of the art equipment and logistical infrastructure. We have a high-BTU, low-sulfur product that competes globally. As such, we need to work on the next game changer that will carry the coal industry forward in an increasingly dynamic and competitive energy landscape. Now is an opportune time to get started.

“From CONSOL’s standpoint, we are in the process of implementing automation technologies across our longwall fleet, and we are testing a technology that would recover coal from our prep plant thickener underflow to produce an upgraded quality product and reduce or eliminate the need for fine coal refuse impoundments going forward.

“But that is only the tip of the iceberg. There are potential opportunities to extend automation to continuous mining, to use big data and machine learning to optimize the mining, processing, and logistics processes, and to develop new product streams from coal and coal byproducts. We need to do this not only to keep coal competitive, but also to attract innovative thinkers from a wide variety of backgrounds to come to work for our industry

A Funding Focus

In the wake of the Parkland school shooting that left 17 students and teachers dead, a school district in Pennsylvania appealed for funds for a resource officer to up security. Although there were plans for a resource officer to be incorporated into West Greene School District three years ago, funding was not available. This time, however, CONSOL Energy stepped in to cover the cost

Over the next three years, the company will pay for a majority of the resource officer’s salary.

“We thought it was the best use for our philanthropic dollars,” Brock said. “We’re located in West Greene School District’s region. We have deep roots in this county. We’re a member of the community, and we hope it encourages other businesses to consider a similar act.”

Clean Coal Recovery Project

After safety, compliance—often with a focus on the environment—ranks high in CONSOL Energy’s values.

“Our environmental goals have shifted from wanting just to reach a high compliance standard with operating permits to including voluntary evaluations and the implementation of environmental control strategies that will allow us to minimize our impact for the long term,” Brock said.

“Reclamation of the land is important, clean water is important. We need to keep our operational footprint as small as we can and still be able to mine a resource which is plentiful in the U.S.”

Recently, a partnership was formed between CONSOL Energy and OMNIS Bailey, LLC. This will focus on processing waste coal at the Bailey Mine Complex and converting it to clean carbon fuel (CCF). The partnership is currently in a pilot program to capture what is normally a byproduct of cleaning coal and recovering it to use for other applications.

Recovering the waste coal creates a high BTU product that is comparatively low in impurities and is expected to provide an attractive, cleaner-burning option for coal-fired power plants, while simultaneously reducing or eliminating the need for slurry impoundments at the mine site. The second application is a byproduct that might have a new use: a soil enhancer for farmland.

"The impurities we are removing from coal are really fossilized mineral matter from plants,” said Charles Gassenheimer, CEO of OMNIS Bailey. “After several years of testing at USDA facilities, this topsoil has been shown to remediate mineral-depleted farmland, leading to both enhanced plant growth and nutritionally-superior food.  Simply stated, we are creating two marketable products from coal waste that offer significant benefits to society—cleaner energy and better food."

“We’re excited about where we are now and where this is going,” Brock shared. “Projects like this help make our product better and reduce the environmental footprint.”

Conclusion

CONSOL Energy’s longevity proves a lot; if a company can not only survive but thrive through a civil war, a world war, and multiple recessions, chances are high that it will continue succeeding well into the future. There are several things at play to make a good company, but Brock thinks he knows the foundation of CONSOL Energy’s success.

“CONSOL Energy has the best coal miners in the world,” he said. “These miners produce the products that allow Americans to light up their lives and warm their homes.

“The coal industry is alive and kicking: becoming more efficient and focused on reducing environmental footprints. We’re in the unique position to provide an affordable energy source not only in the U.S., but around the world.

“Coal isn’t going away. Through innovation, improved technology and an unrelenting focus on responsibly producing and using it all across the world, it will remain a vital part of our energy mix.”