BNI Coal, Minnkota Sign 10-Year Extension to Coal Supply Agreement
DULUTH, Minn. -- April 28, 2014
BNI Coal, an ALLETE (NYSE: ALE) company, has reached an agreement with
Minnkota Power Cooperative to continue supplying lignite coal to the North
Dakota electric generating cooperative through 2037.
The agreement extends the current contract, which would have ended in 2027, by
10 years. BNI Coal owns and operates a surface lignite mine in Center, North
Dakota, producing about 4 million tons annually. Virtually all of BNI’s
lignite production is consumed by the nearby Milton R. Young Station, the
primary source of electrical generation for Minnkota.
Al Hodnik, ALLETE president, chairman and CEO, Robert “Mac” McLennan, Minnkota
president and CEO, and Wade Boeshans, president and general manager of BNI
Coal, finalized the agreement April 22 at BNI headquarters in Bismarck, North
"The Minnesota Power-Minnkota Power Cooperative business relationship, first
forged in the 1970’s and furthered during ALLETE's acquisition of BNI Coal in
the late 1980’s, has always been about partnership and mutual interest,”
Hodnik said. “This BNI-Minnkota coal supply agreement extension reflects that
same spirit, and we have appreciated the opportunity to work in close
partnership with Mac McLennan and his team on this and other strategic matters
important to our industry, our customers and to the state of North Dakota."
The new agreement is a strong signal of BNI and Minnkota’s commitment to the
Center mine and North Dakota coal.
"This contract extension supports Minnkota's ability to deliver the affordable
and reliable energy generated by the Young Station to our members in North
Dakota and Minnesota,” McLennan said.
Boeshans said the agreement well positions BNI for long-term planning and
investment opportunities necessary for continued safe and efficient mine
operations. The stability afforded by extending the contract terms will help
BNI compete for skilled workers in North Dakota’s very competitive job market,
“Coal plays a significant and essential role in a balanced energy-independent
future for our nation. The lignite industry is committed to providing low-cost
reliable energy to consumers while continuously reducing our environmental
impact,” Boeshans said. “We’re in it for the long term.”
BNI and Minnkota signed the original cost plus fixed-fee agreement to supply
the Young station in 1974. The 10-year extension also includes the option to
extend the agreement an additional five years through 2042.
The statements contained in this release and statements that ALLETE may make
orally in connection with this release that are not historical facts, are
forward-looking statements. Actual results may differ materially from those
projected in the forward-looking statements. These forward-looking statements
involve risks and uncertainties and investors are directed to the risks
discussed in documents filed by ALLETE with the Securities and Exchange
Amy Rutledge, 218-723-7400
Manager - Corporate Communications
Wade Boeshans, 701-355-5500
General Mgr. & President
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