Development News From Southwest Indiana

Vectren to open two new underground coal mines near Vincennes
Vectren Fuels (Fuels), the wholly owned coal mining operations subsidiary of Vectren Corp. (NYSE:VVC) , has begun the process of opening two new underground mines near Vincennes, Ind. The first mine is expected to be fully operational by early 2009, with the second mine to open the following year. The southwestern Indiana mines will provide an estimated 425 local jobs to contract miners.Both reserves are ideally located within 50 miles of eight coal-fired power plants and sit immediately adjacent to the CSX mainline railroad to easily serve neighboring facilities. Combined production is projected at five million tons annually, with the majority to be used at Vectren's A.B. Brown and F.B. Culley power plants in Posey and Warrick counties. This development will help replace the company's Cypress Creek surface mine in Boonville, Ind.The mineral rights for the reserves, which are estimated at 80 million tons of recoverable number-five coal at 11,200 BTU (British thermal units) and 6-pound sulfur dioxide, were purchased from Templeton Coal Company. The $125 million investment should begin production in the coming years as Fuels works to obtain permits and construct surface and underground facilities.

Once in production, the two new mines, combined with Fuels' existing underground mine will yield approximately eight million tons of coal per year.
Source: Vectren Corp.

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