CHARLESTON, W.Va. -- Appalachian coal producers stand to benefit from a $7 billion deal to send coal across the seas to Indian power plants.
The deal, announced Wednesday, will send about nine million tons of Appalachian coal to India each year for the next quarter century.
That's a significant announcement for Appalachian mining companies, which have seen layoffs because of low demand for power-generating coal, and for India, which needs fuel to feed its growing hunger for electricity.
"I think that's very, very confidence building to know that other countries depend on us," said West Virginia Coal Association President Bill Raney.
The U.S. is already one of the key global exporters of coal. Currently, about 38 million tons of coal are exported for power generation, according to the U.S. Energy Information Administration. That may grow.
The International Energy Agency estimates coal demand will grow by 600,000 tons every day over the next five years, with most of the demand coming from China or India.
All the while, American coal consumption is in decline.
"As we are closing the door on coal in the U.S. -- China, India and the other developing countries are opening the door, so we see a lot of potential for U.S. exports of coal," said Ed Hatfield, president of Cincinnati-based River Trading Company. The barging company will help get the coal from Appalachia to India.
Hatfield said the deal, with India's Abhijeet Group, has been in the works for several months.
It's unclear yet how much West Virginia producers will benefit from the deal.
Booth Energy Group, which operates as Argus Energy in West Virginia, will mine two of the nine million tons of coal. The other seven million tons will come from a collection of eastern Kentucky and West Virginia mines, Hatfield said.
Shipments begin in September.