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Mar. 22, 2006

United Coal Company Purchases Rapoca Group LLC

When United Coal Company sold its Wellmore #7 and #8 coal preparation plants to Massey Energy in 1997, it did not anticipate getting them back in 2006 – especially from a different owner.

On Jan. 4, however, the two preparation plants were back in the UCC fold as part of United Coal’s purchase of The Rapoca Group, LLC, Bristol, Va.  Through the acquisition, United Coal has resurrected a well known name that was associated with United Coal in the ‘70s, ‘80s and ‘90s.  The Rapoca Group LLC has been re-named Wellmore Coal Company LLC, and its affiliates that were acquired by United Coal will be subsidiaries of Wellmore Coal Company.


“Many of Rapoca’s employees are former United Coal employees,” Jim McGlothlin, CEO of UCC parent The United Company, said. “And several of the people who built and managed Wellmore #7 are still employed at United Coal.  They probably remember December 1975, when Wellmore #7 was almost complete. It was bitterly cold, and the crews were working double shifts to finish it by the end of the year. It was a massive effort, and they really put their hearts into their jobs.  It’s heart-warming to have that family reunited.”

In addition to Wellmore #7 and #8, located in Big Rock, Va., and the Nora preparation plant located in Nora, Va., UCC acquired 100 percent of the membership interests in Rapoca and certain of its affiliates.  Those assets include 11 underground and six surface mining operations throughout Buchanan, Tazewell and Dickenson counties, with additional reserves in Pike County, Ky., and McDowell County, W.Va.

The acquired coal reserves are primarily mid/high volatile metallurgical reserves in the Splashdam, Banner, Glamorgan, Jawbone and Hagy seams.  Rapoca has more than 30 million tons of recoverable reserves.

“The coals are a perfect strategic fit for us,” UCC CEO & President Michael Zervos said.  “The Splashdam reserves are some of the most sought after mid/high volatile coal in the Central Appalachian basin.  Our sales team has a long and successful history selling this coal to domestic and international metallurgical coal consumers. The Wellmore coals will complement our recent low vol acquisition at Pocahontas Coal and existing high vol coal at Carter Roag."

Clyde Stacy, owner of Rapoca, received a minority ownership interest in UCC as part of the sale and will remain involved with UCC.

“This is a great time for the coal industry,” Stacy said. “And it’s wonderful to have United back in the coal business. It was always a progressive company.   That attitude prevails, and I’m excited to be a part of it.”

Since its recent re-emergence into the coal business, UCC has aggressively expanded its reserve base in the Central Appalachian coalfields. The company expects to produce more than 6 million tons in 2006 from 27 mines and seven coal preparation plants. United Coal is a privately held company, with subsidiaries in West Virginia, Virginia and Eastern Kentrucky.