ArcelorMittal to buy Appalachian coal producer

Luxembourg-based ArcelorMittal said Monday it has agreed to buy Mid Vol Coal Group, which owns approximately 85 million tons of reserves in Central Appalachia. ArcelorMittal is already the largest customer of Mid Vol, which produced 1.5 million tons of coal last year from West Virginia and Virginia mines, ArcelorMittal said.

ArcelorMittal's U.S. acquisition focuses on metallurgical-grade coal, which is used to make coke for steelmaking. Metallurgical coal prices have soared from less than $100 a ton a year ago to as much as $250 a ton this year.

"This acquisition further increases our upstream self sufficiency in a primary raw material during a time when metallurgical coking coal demand on a global scale remains strong," Chief Financial Officer Aditya Mittal said in a statement.

He said the quality of the coal meets standards demanded by his company's plants. He added that ArcelorMittal aims to double the production level at Mid Vol in the short to medium term. Also, permits have been granted recently that will help that process.

The U.S. acquisition comes amid talk that ArcelorMittal is close to buying Australia's Macarthur Coal Ltd.

Trading in the shares of Macarthur Coal, supplier of more than a third of the world's pulverized coal, were halted at the company's request pending a statement about talks with ArcelorMittal, the world's largest steelmaker.

Macarthur Coal director and founder Ken Talbot has stepped down from the board to avoid any possible conflicts of interest relating to his 19.76 percent stake in Macarthur Coal.

ArcelorMittal last month approached Macarthur Coal about a potential deal after buying 14.9 percent in the company.

ArcelorMittal has more than 310,000 employees in more than 60 countries.