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Corsa CEO remains bullish on economy

December 29, 2018

Many people have been watching the stock market closely for the past two weeks, going from dread to relief and back to dread again in the span of a few days. George Dethlefsen, CEO of Corsa Coal Corp., offered a reassuring message to people living in Somerset County, where the company employs a large number of people.

“The stock market has been on a 10-year bull run, fueled in large part by the most accommodative monetary policy in history — zero percent interest rates and aggressive monetary stimulus for the entirety of the Obama Administration years,” Dethlefsen wrote in an email. “The Federal Reserve is now raising interest rates, which constricts money flow and lowers economic growth rates. The stock market is responding to that. Employment levels, GDP growth, and consumer confidence remain very high as a result of favorable, pro-business Trump Administration policies.”

Corsa Coal Corp., based in Canonsburg, has around 400 employees, the bulk of whom are in Somerset County and Garrett County, Maryland. This year, Corsa completed the ramp-up of the Acosta Deep Mine, which opened in 2017, made significant progress on the development of the Horning mine east of Somerset, developed the northeastern reserve base at the Casselman mine and completed a face mining equipment upgrade cycle.

That move will reduce capital expenditures in the coming years while also reducing repair and maintenance expenses and improving productivity, according to a news release from the company.

Additionally, it divested the thermal coal-producing Central Appalachia division to become purely a metallurgical coal producer. That type of coal is used to produce steel and metal. Dethlefsen forecast metallurgical coal sales to increase by 33 percent in 2019, as the Casselman and Acosta mines produce at full capacity and as they ramp up the Horning and Schrock Run mines.

Dethlefsen addressed some other issues that have been on people’s minds lately, including the weather. Climatologists have speculated that the wet and warm weather has been a product of climate change brought on by excessive carbon emissions. Many scientists across the globe have argued against the use of coal altogether. Dethlefsen offered his analysis.

“It’s the height of absurdity to suggest that the coal industry is responsible for increased rainfall or delayed fall foliage in Somerset County this year, or any year,” he wrote in an email. “The earth has a 5 million year track record of variations in climate and this year’s weather is just a tiny micro-sample of that history. CO2 represents 0.04% of the earth’s atmosphere and 90%+ of CO2 emitted into the atmosphere doesn’t come from man’s contributions. Coal emissions are a tiny fraction of C02 levels. The United States uses about 5% of the coal used globally. Corsa produces less than 1% of the coal produced in the United States.”

While many in the county, including those in the agricultural sector, have complained about President Donald Trump’s tariffs, which resulted in a trade war with China, Dethlefsen said they have benefited his company.

“The tariffs have led to a renaissance in the steel industry in the United States,” he said. “Corsa has increased its sales to domestic customers for 2019 and metallurgical coal prices are at 10 year highs domestically.”

Dethlefsen remains bullish about the future of coal in the county, country and world.

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