Armstrong Coal Company

IN JUST THREE YEARS, THIS FIRM HAS BECOME ONE OF WESTERN KENTUCKY’S LEADING COAL PRODUCERS

Future looks bright with quality Komatsu equipment and dealer's Repair and Maintenance Program (RAMPs)

A little more than three years ago, Armstrong Coal Company was just an idea — a plan on paper. Today, it has four operating coal mines, employs almost 500 people, and controls an estimated 250 million to 300 million tons of coal reserves.

“Armstrong Coal was incorporated in late 2006,” recalled Kenny Allen, Vice President of Operations. “The company’s first employee was David Cobb, and I came on board in June 2007. We opened our first mine in 2008 and shipped our first coal in July of that year. Today, we’re producing about 6 million tons annually. It’s definitely been a fast-growth project.”

Headquartered in Madisonville, Ky., Armstrong Coal Company is a subsidiary of St. Louis, Mo.-based Armstrong Land Company. In addition to Allen, principals in the firm include Chairman of the Board J. Hord Armstrong, III; President Martin Wilson; Vice President of Corporate Development David Cobb; and Vice President and Controller Dick Gist.

“David Cobb and I have about 80 years of combined experience in the coal mining industry,” said Allen. “He worked as a consultant to local coal companies here in western Kentucky for many years. Although I traveled extensively with Peabody Coal for 25 of the 40 years I’ve been in this business, this area was always home to me. We were both familiar with the reserves here, so it was very exciting for us to help put this thing together.”

Two surface and two underground mines

Western Kentucky coal is a medium- to high-sulfur-content coal from the Illinois Basin. The market for such coal has improved since the “Clear Skies Act” in 2003 leveled the playing field for high-sulfur coal by mandating scrubbing for all power plants.

Armstrong Coal’s current properties include two surface mines (Midway and East Forks, both in Ohio County near Centertown) and two underground mines (Big Run in Ohio County and Parkway in Mulhenburg County). The company has prep plants for washing the coal at Midway and Parkway.

“All of our customers are power plants, primarily nearby public utilities, that burn coal to generate electricity,” noted Allen. “Our goal is to be known as a reliable supplier of clean, high-quality, custom-blend coal. One thing that helps us is good transportation from our properties. We have rail and truck at the Midway prep plant and we have barge and truck at Parkway.”

Topnotch work force

In addition to significant reserves and good transportation, the region also has a lot of experienced miners, and young people excited about the opportunity to join the mining industry.

“At Armstrong, we’ve found an excellent group of employees — a good combination of veteran miners and young people,” said Allen. “We’ve hired some former miners who were with Peabody when they had an operation here. We’ve hired from some local companies. We’ve also hired people with no actual mine experience. They’ve all come together to give us a great mix of knowledge and enthusiasm.”

Some of the young people hired by Armstrong have gone through the mining program at KCTCS (Kentucky Community & Technical College System) in Madisonville.

“The college has a new energy technology center with virtual-reality equipment, which are like simulators, for almost every machine used in a mining operation,” Allen explained. “The program, which includes an aptitude test, was designed by miners and is an example of the progressive steps the industry is taking to improve itself. When students graduate, they’re ready to be safe and productive in a real mine environment within a very short period of time.”

Quality equipment and RAMPs for support

In opening four mines in about a year’s time, Armstrong Coal needed a large amount of equipment. For part of its fleet, it turned to Komatsu machines from Brandeis Machinery & Supply. Among the Komatsu pieces are six hydraulic excavators (two PC1250LC-8s, three PC800LC-8s and a PC200LC-8); five wheel loaders (WA900, WA800 and three WA250s); five dozers (a D475 and four D65s) and five trucks (three 61-ton HD465s and two 106-ton HD785s).

“Our Komatsu machines have performed well,” confirmed Allen. “We’re especially pleased with the excavators. We use the PC1250s (672 hp) and PC800s (487 hp) primarily to load coal or scale the highwall, and they’ve done a good job.

“We use our Komatsu WA800 wheel loader to load highway trucks,” he added. “We have a special 29-foot wide bucket on it which makes it a unique machine. With that bucket, it’s as wide as the semis it’s loading and is able to fill the trucks in two passes.”

In addition to turning to Brandeis for Komatsu equipment, Armstrong Coal is also using Brandeis’ Repair and Maintenance Program (RAMP) to service and repair machines.

“We needed to have RAMPs for our equipment because of a lack of mechanics,” said Allen. “It’s difficult to find people with the skill set to work on these highly technical machines. With all our Komatsu big iron under RAMPs (84 months/35,000 hours), we turn the maintenance and repair issues over to Brandeis.

“Brandeis has at least one technician and one PM (preventive maintenance) guy working on our properties every day, and if they need more people, they bring out more,” he explained. “Because we run our equipment 20 hours a day, Brandeis also provides us with night service out of Evansville as needed. The best thing about RAMPs is they make the dealer responsible for keeping our equipment up and running, and they guarantee us the uptime we need to be successful.”

The importance of coal

Despite challenges, Allen says he’s optimistic about coal’s future. “Although coal is under attack from a lot of directions, the fact remains that it generates more than 50 percent of all the electricity in the U.S. Compare that with renewables, all of which combined generate less than 2 percent. Even if they double that, which is the goal, it’s still just 4 percent.

“As a country we keep growing and needing more power,” Allen added. “Because it’s going to have to come from somewhere, we’re confident that coal, of which we have a vast supply, is going to be in demand for years to come. We also believe that with industry expertise and good old American know-how, we’re smart enough to figure out how to continue to use it in an environmentally safe manner.”

In fact, Allen says, the industry has already cleaned up a lot — and would like to do more. “Going back to the first Clean Air Act (1976), the use of coal for generation of electricity has increased more than 300 percent, but coal emissions from power plants have decreased more than 56 percent. That’s impressive, but the frustrating thing is that today’s plants, most of which are more than 40 years old, aren’t nearly as efficient as they could be.

“Due to technology improvements, a new plant is more than twice as efficient as an old one, but environmental groups have blocked many new plants from being built,” he noted. “That means, ironically, that they are essentially stopping us from cleaning up the environment.”

Future looks bright

As for Armstrong itself, the company has another mine, the Equality surface mine, ready to start up as soon as final permits are issued. Equality will be Armstrong Coal’s largest mine. The company also has two other mines in the planning stages and has a 1,200-ton-per-hour prep plant ready to open at the Armstrong Dock facility in Centertown as soon as it’s permitted.

“It’s a lot of work but it’s been very exciting,” Allen said of Armstrong Coal. “We’re definitely still growing and still looking for new opportunities. And we’re very proud of what we do. For one thing, we’re providing good jobs to hundreds of people at a time when jobs in this region — or anywhere for that matter — are hard to come by. But beyond jobs, our nation has a long-term energy problem. All of us at Armstrong Coal believe our industry is, and will continue to be, a large part of the solution to that problem, and that’s something we take a lot of pride in.”