CONSOL Energy Announces Operational and Financial Update; Company Expects to Report a Third Quarter Loss Due to Combination of

 CONSOL Energy Announces Operational and Financial Update; Company Expects to
 Report a Third Quarter Loss Due to Combination of Marketing and Operational
       Issues; Gas Division Reports Exploratory Success in Utica Shale

PR Newswire

PITTSBURGH, Oct. 15, 2012

PITTSBURGH, Oct. 15, 2012 /PRNewswire/ --CONSOL Energy Inc. (NYSE: CNX), the
leading diversified fuel producer in the Eastern U.S., is providing an
operational and financial update for the quarter ended September 30, 2012.

(Logo: )

The company expects to report a net loss for the quarter, due to a combination
of marketing and operational issues. "While precise figures are not yet
available, it is clear that the company's previously announced planned and
unplanned mine idlings took their toll on third quarter earnings," commented
William J. Lyons, chief financial officer. "Fortunately, CONSOL Energy has the
balance sheet to maintain market discipline. Even at the end of the quarter,
our liquidity remained strong. At September 30, 2012, we had cash of $231
million, no short term debt, and $2.3 billion of capacity under our credit

During the last several months, CONSOL announced a planned two-week idling of
Blacksville Mine and a one-week idling of Robinson Run Mine, due to weak
thermal coal markets. The Fola Mine was also idled. Subsequently, the company
suffered the failure of two newconveyor belts at the Bailey Preparation
Plant, which impacted production at the Enlow Fork and Bailey mines. Then, in
early September, the company announced the idling of its premier low-vol
Buchanan Mine for an estimated 30-60 days.

CONSOL's Gas Division, in the Ohio Utica Shale joint venture with Hess
Corporation, reported an exploratory success from a well drilled in Stock
Township, Noble County, Ohio. Flowback operations are underway at the Noble 1A
following a 30-day shut in period for dissipation of fracturing fluids. Early
results are encouraging with peak 24-hour flows of 9.0 MMcfd gas and about 10
barrels per day of condensate. CONSOL is currently drilling the Noble 16A in
nearby Seneca Township, also in Noble County. Overall, the joint venture has a
significant acreage position in Noble County.

CONSOL's Coal Division produced 11.6 million tons during the quarter,
including 0.8 million tons of low-vol metallurgical and mid-vol coal from the
company's Buchanan and Amonate Mines.

CONSOL's total coal inventory decreased during the quarter by 0.7 million tons
to 1.7 million tons as of September 30, 2012. Thermal coal inventory decreased
by 0.8 million tons during the quarter, as sales outpaced the scaled-back
production. Low-vol and mid-vol coal inventory increased by 0.1 million tons
during the quarter, to 0.4 million tons.

CONSOL Energy's core values are safety, compliance, and continuous
improvement. During the first nine months of 2012, the company has
experienced a 4% year-over year improvement in the incident rate among
employees. On October 5, we held our second Core Value Summit with our key
vendors to help them embrace our core values. As a result of our increased
focus on outside vendor safety, we have experienced a 14% decline in our
contractor incident rates over the same period. During the third quarter, the
company's Enlow Fork Mine logged one million hours without incurring a
recordable injury. Against this backdrop of improving overall safety, though,
CONSOL Energy's coal division did suffer a fatality in the third quarter.
While we continue to invest significantly to reach our ultimate goal of
Absolute Zero, our challenge is to continue to identify and eliminate risks.

CONSOL's Gas Division produced 39.5 Bcf for the 2012 third quarter, down
slightly from the 40.4 Bcf produced in the 2011 third quarter. The just-ended
quarter, however, was impaired by approximately 0.2 Bcf due to the September
idling of the Buchanan Mine, which produces associated gas. A second
complication in making a comparison was that last year's third quarter
production contained 100% of the Marcellus Shale production, half of which was
tendered to the Noble Energy joint venture on September 30, 2011. The
year-earlier quarter's production also contained some production from Antero's
overriding royalty interest, before it was sold back to Antero. On an adjusted
basis, therefore, last year's 40.4 Bcf would have been approximately 35.9 Bcf,
net to CONSOL. On an apples-to-apples basis, CONSOL's gas production would
have increased by 13%, if not for these items.

During the third quarter of 2012, CONSOL Energy drilled 12 Marcellus Shale
wells, completed 12 Marcellus Shale wells, and placed 22 online. Additionally,
Noble Energy drilled four Marcellus Shale wells in the liquids-rich area of
the play. Also during the quarter, CONSOL Energy drilled four Utica Shale
wells in Ohio, completed two Utica Shale wells, and placed one Utica Shale
well on line. Hess Corporation drilled one well in the Utica Shale.

Fourth Quarter 2012 Forecasts

Coal: CONSOL Energy expects to produce 13.4 – 13.8 million tons during the
quarter, including 0.6 million at the Buchanan Mine, which is expected to
re-start on the week of November 5.

Gas: CONSOL's 2012 gas production guidance remains at 157 - 159 Bcf (net to
CONSOL). Fourth quarter 2012 gas production is expected to be 42.5 – 44.5 Bcf.

Coal Division Operations/Marketing

The Coal Division Operations were coordinated with the Marketing Department
during the quarter in order to maintain discipline in the face of weak markets
for low-vol, mid-vol, and high-vol coal. CONSOL was successful in lowering
total company inventory, in spite of weak markets.

CONSOL's strong liquidity gives it the flexibility to respond to weak markets
by voluntarily curtailing production. The company believes it is
counterproductive to sell into certain markets that are going through a
de-stocking phase.

CONSOL's CNX Marine Terminal also proved valuable in the quarter by loading 34
vessels with total outbound tonnage of 3.1 million, including third party

The one unplanned idling was that of the Bailey and Enlow Fork mines in
Southwestern Pa. As announced at the end of July, two newly-installed conveyor
belts that feed the common preparation plant collapsed. Engineers and
contractors working around the clock had one belt rebuilt by the third week in
August. The mines were re-started at a 60% capacity utilization rate. The
second belt was repaired in late September, so the fourth quarter began with
the entire complex running normally.

Gas Division Operations

In continuous improvement, CONSOL-operated Marcellus Shale wells in Central
Pa., Southwest Pa., and Northern W. Va. all achieved record peak 24-hour
production rates for their respective districts. The Gas Division also has
been dramatically extending its completed Marcellus Shale lateral lengths. In
2011, the average completed lateral was 3,300'. For Marcellus Shale wells
turned on line through the first three quarters of 2012, completed lateral
lengths have averaged 4,870' and have reached a maximum completed lateral
length of 8,460' during the recent quarter.

CONSOL's economics are also being improved by cost reductions in items such as
costs per frac stage. In 2011, CONSOL was spending $205,000 per stage. In 2012
to date, frac costs have fallen to $181,000 per stage. These costs are all-in,
from TD to flowback.

The Gas Division continued to use water from coal mines for hydraulic
fracturing. This is another in a long line of synergies between CONSOL's coal
and gas divisions. During the third quarter, the MOR 10F was fractured with a
blend of up to 16% mine-sourced water. The MOR 10F (13 stages, 3,613'
completed lateral) came on line on August 6^th at an initial rate of 10.8

Another technical innovation in Southwest Pa. was the testing of fractures of
450' stage lengths versus the normal 300' stages. The three-well MOR 17
(completed laterals ranging from 2,211' to 2,594') with initial 24-hour flow
rates between 7.0 and 8.0 MMcfd, These are truly exceptional results from
wells of such short lengths.

Marcellus Shale Dry Gas (CONSOL Energy-operated):

Central Pa.: CONSOL Energy did not drill any horizontal wells in the Central
Pa. Marcellus Shale, because the 2012 drilling program was completed in the
second quarter.

Flowback operations were finished at the four-well Gaut 4 pad in Westmoreland
County that was drilled during the first quarter of 2012 and completed during
the second quarter. This pad had a total of 109 stages and lateral lengths
ranging from 7,243' (24 stages) to 8,460' (29 stages). At the tail end of the
second quarter, the Gaut 4A was announced as CONSOL Energy's record producing
well at a peak rate of 17.9 MMcfd. That record was broken early in the third
quarter by the Gaut 4D, which produced at a new CONSOL Energy record of 23.7

Completion operations were finished late in the third quarter on the six-well
DeArmitt 1 South pad. A total of 145 stages were fractured on the pad that
has completed lateral lengths ranging from 3,822' (1D, 12 stages) to CONSOL
Energy's longest lateral of 8,305' (1F, 29 stages). Flowback operations are
underway at DeArmitt 1 South and production is expected to begin from the pad
before the end of October with all six wells expected to be on line before the
end of 2012.

The four-well Bowers 1 pad, where drilling was completed in the first quarter,
is the first horizontal exploration drilling by CONSOL in Jefferson
County.The centralized impoundment permit was received late in the third
quarter and completion operations are anticipated to begin there before the
end of 2012.

Southwest Pa.: CONSOL Energy continues its full-scale development drilling
within two new pads in Greene County. Drilling operations have finished at the
seven-well NNV 38 pad with a maximum drilled lateral length of 7,000' and the
eight-well NNV 41 pad with a maximum drilled lateral length of 7,200'. Two
rigs are currently drilling in North Nineveh at the six-well NNV 39 and the
five-well NNV 42. Completion operations are expected to commence at North
Nineveh before the end of 2012.

During the third quarter, CONSOL drilled 12 wells, completed 12 wells, and
brought 12 wells online at several pads in the Morris Field. The three-well
MOR 14 pad was brought into production during the third quarter with very
strong results. Initial 24-hour rates from all three wells ranged from 4.2
MMcfd from the MOR 14C (7 stages, 1,786' completed lateral) to 9.5 MMcfd from
the MOR 14B (12 stages, 3,454' completed lateral). Adjacent to the MOR 14,
the six-well MOR 10 pad was completed during the quarter using a total of 100
frac stages. All 6 wells were brought on to production during the quarter
with results ranging from a peak of 8.4 MMcfd from the MOR 10B (14 stages,
3,266' completed lateral) to the new CONSOL Energy SWPA record daily peak rate
of 15.3 MMcfd from the MOR 10D (21 stages, 6,116' completed lateral). Lastly,
the three-well MOR 17 pad was completed with a total of 20 stages. All three
wells came on line with peak daily production rates ranging from 7.0 MMcd from
the MOR 17A (6 stages, 2,211' completed lateral) to 8.0 MMcfd from the MOR 17B
(6 stages, 2,566' completed lateral).

Northern W. Va.: CONSOL Energy did not drill any horizontal wells in Northern
W. Va. during the third quarter, as the 2012 drilling program was concluded in
the second quarter. There were, however, some completions. The three-well
Philippi 4 pad was completed in its entirety during the third quarter with 69
stages. The pad has completed lateral lengths ranging between 6,333' to
6,719'. All three wells were brought onto production during the month of
August with individual well peak 24-hour rates ranging from 6.5 MMcfd to 9.2
MMcfd, the latter being a new CONSOL Energy record for Northern West
Virginia. The six-well Alton 2 pad in Upshur County, drilled during the first
quarter of 2012, was completed late in the second quarter with 135 stages.
Completed lateral lengths ranged from 3,545' (12 stages) to 5,941' (25
stages). All six wells had been turned into production by the end of July
with individual well peak 24 hour rates ranging from 3.5 MMcfd to 6.7 MMcfd.
These flow rates represented significant improvements over the initial Alton 1
pad, which was drilled and completed in 2011.

Marcellus Shale Wet Gas (Noble Energy-operated):

In the wet gas portion of the Marcellus Shale, Noble Energy has begun
producing from its first pad, the SHL-1 pad. As reported in early September,
the first four wells from this 5-well pad achieved an IP rate of 18.6 MMcfd.
For each MMcf of gas, the four wells were also producing 22 bbls of condensate
and 56 bbls of NGLs. Assuming $3 per Mcf for dry gas, the realized flowstream
was approaching $8 per Mcf. This exceeded company expectations. Recently, some
production from this area has been curtailed due to a force majeure issue from

For the year-to-date, Noble Energy has drilled 15 wells, including four in the
third quarter. Noble Energy has turned 9 wells into line so far this year, all
of which were in the third quarter.

Noble Energy has three horizontal rigs drilling. The company is moving to the
elimination of using a separate rig for the top hole drilling as well as batch
drilling on the pads.Noble Energy believes that this method of drilling will
be more efficient and result in fewer rig moves over time, eliminating a
significant amount of road traffic and reducing costs.

Noble Energy believes that they will TD 26 - 28 wells this year, in spite of
moving to batch drilling.

Ohio Utica Shale (CONSOL Energy-operated):

In the Utica Shale joint venture with Hess Corporation, CONSOL Energy turned
its first well, the TUSC 3A (17 stages, 4,915' completed lateral), online in
the western portion of Tuscarawas County, Ohio. The well produced at a peak
daily rate of 400 bbls of light crude, before it was shut in for dissipation
of frac fluids and to be equipped with artificial lift at the end of May. The
shut in lasted for approximately 10 weeks before being brought back online in
early September and now has cumulative production of over 7,800 barrels of

During the third quarter, CONSOL Energy drilled four horizontal wells to TD.
The NBL 1A in Noble County was drilled with a cased lateral length of 4,306',
the PORT 2A in Portage County was drilled with a cased lateral length of
4,762', the MAHN 2A in Mahoning County was drilled with a cased lateral length
of 2,735', and the NBL 16A in Noble County was drilled with a cased lateral
length of 4,793'. Completion operations are underway on all four wells.

The NBL 1A was completed in 14 stages over a completed lateral length of
4,009'. Flowback operations are just beginning following a 30-day shut in for
dissipation period. The PORT 2A was completed in 16 stages over a completed
lateral length of 4,610'. Flowback operations there are underway and the well
will then be shut in for a 60-day dissipation period. The MAHN 2A and NBL 16A
are expected to be fracture stimulated by the middle of the fourth quarter.

CONSOL Energy is operating two horizontal rigs in the Utica Shale, one in
Tuscarawas County drilling the TUSC 8A and one in Mahoning County drilling the
MAHN 7A. In total for 2012, CONSOL Energy expects to drill 8 wells on its
acreage in the Ohio Utica Shale.

Ohio Utica Shale (Hess-operated):

Our joint venture partner, Hess Corporation, is operating two joint rigs in
Harrison County, drilling the CNX HAR9N4W 1H-6 and the CNX HAR9N5W 1H-24
wells. In total for 2012, and ultimately depending on the actual timing of
the drilling operations, Hess expects to have completed drilling operations on
2 wells on its JV acreage in the Ohio Utica Shale, and to have begun drilling
on 2 others.

Earnings call information:

CONSOL Energy will report additional operational and financial results for the
quarter ended September 30, 2012 at 7:00 a.m. ET on Thursday, October 25,
followed by a conference call at 10:00 a.m. ET. The call can be accessed at
the investor relations section of the company's web site, at

Cautionary Statements

Various statements in this release, including those that express a belief,
expectation or intention, may be considered forward-looking statements (as
defined in Section 21E of the Exchange Act) that involve risks and
uncertainties that could cause actual results to differ materially from
projected results. Accordingly, investors should not place undue reliance on
forward-looking statements as a prediction of actual results. The
forward-looking statements may include projections and estimates concerning
the timing and success of specific projects and our future production,
revenues, income and capital spending. When we use the words "believe,"
"intend," "expect," "may," "should," "anticipate," "could," "estimate,"
"plan," "predict," "project," or their negatives, or other similar
expressions, the statements which include those words are usually
forward-looking statements. When we describe strategy that involves risks or
uncertainties, we are making forward-looking statements. The forward-looking
statements in this press release, if any, speak only as of the date of this
press release; we disclaim any obligation to update these statements. We have
based these forward-looking statements on our current expectations and
assumptions about future events. While our management considers these
expectations and assumptions to be reasonable, they are inherently subject to
significant business, economic, competitive, regulatory and other risks,
contingencies and uncertainties, most of which are difficult to predict and
many of which are beyond our control. These risks, contingencies and
uncertainties relate to, among other matters, the following: deterioration in
economic conditions in any of the industries in which our customers operate,
or sustained uncertainty in financial markets cause conditions we cannot
predict; an extended decline in prices we receive for our coal and gas
affecting our operating results and cash flows; our customers extending
existing contracts or entering into new long-term contracts for coal; our
reliance on major customers; our inability to collect payments from customers
if their creditworthiness declines; the disruption of rail, barge, gathering,
processing and transportation facilities and other systems that deliver our
coal and gas to market; a loss of our competitive position because of the
competitive nature of the coal and gas industries, or a loss of our
competitive position because of overcapacity in these industries impairing our
profitability; coal users switching to other fuels in order to comply with
various environmental standards related to coal combustion emissions; the
impact of potential, as well as any adopted regulations relating to greenhouse
gas emissions on the demand for coal and natural gas, as well as the impact of
any adopted regulations on our coal mining operations due to the venting of
coalbed methane which occurs during mining; foreign currency fluctuations
could adversely affect the competitiveness of our coal abroad; the risks
inherent in coal and gas operations being subject to unexpected disruptions,
including geological conditions, equipment failure, timing of completion of
significant construction or repair of equipment, fires, explosions, accidents
and weather conditions which could impact financial results; our focus on new
gas development projects and exploration for gas in areas where we have little
or no proven gas reserves; decreases in the availability of, or increases in,
the price of commodities and services used in our mining and gas operations,
as well as our exposure under "take or pay" contracts we entered into with
well service providers to obtain services of which if not used could impact
our cost of production; obtaining and renewing governmental permits and
approvals for our coal and gas operations; the effects of government
regulation on the discharge into the water or air, and the disposal and
clean-up of, hazardous substances and wastes generated during our coal and gas
operations; the effects of stringent federal and state employee health and
safety regulations, including the ability of regulators to shut down a mine or
well; the potential for liabilities arising from environmental contamination
or alleged environmental contamination in connection with our past or current
coal and gas operations; the effects of mine closing, reclamation, gas well
closing and certain other liabilities; uncertainties in estimating our
economically recoverable coal and gas reserves; costs associated with
perfecting title for coal or gas rights on some of our properties; the
outcomes of various legal proceedings, which are more fully described in our
reports filed under the Securities Exchange Act of 1934; the impacts of
various asbestos litigation claims; increased exposure to employee related
long-term liabilities; increased exposure to multi-employer pension plan
liabilities; minimum funding requirements by the Pension Protection Act of
2006 (the Pension Act) coupled with the significant investment and plan asset
losses suffered during the recent economic decline has exposed us to making
additional required cash contributions to fund the pension benefit plans which
we sponsor and the multi-employer pension benefit plans in which we
participate; lump sum payments made to retiring salaried employees pursuant to
our defined benefit pension plan exceeding total service and interest cost in
a plan year; acquisitions and joint ventures that we recently have completed
or entered into or may make in the future including the accuracy of our
assessment of the acquired businesses and their risks, achieving any
anticipated synergies, integrating the acquisitions and unanticipated changes
that could affect assumptions we may have made and divestitures we anticipate
may not occur or produce anticipated proceeds including joint venture partners
paying anticipated carry obligations; the anti-takeover effects of our rights
plan could prevent a change of control; increased exposure on our financial
performance due to the degree we are leveraged; replacing our natural gas
reserves, which if not replaced, will cause our gas reserves and gas
production to decline; our ability to acquire water supplies needed for gas
drilling, or our ability to dispose of water used or removed from strata in
connection with our gas operations at a reasonable cost and within applicable
environmental rules; our hedging activities may prevent us from benefiting
from price increases and may expose us to other risks; and other factors
discussed in the 2011 Form 10-K under "Risk Factors," as updated by any
subsequent Form 10-Qs, which are on file at the Securities and Exchange


Contact: Investors: Dan Zajdel, +1-724-485-4169,,
or Tyler Lewis, +1-724-485-3157,, or Media: Lynn
Seay, +1-724-485-4065,
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