Phillips sells coal assets, raises cash

BARTLESVILLE, Okla., Oct. 12, 2000—Phillips Petroleum Co., Bartlesville, Okla., said Thursday it has sold its coal interests in three separate transactions for $191 million, representing a $48 million after-tax gain.

Kiewit Construction Co., Omaha, Neb., purchased Phillips’s 50% interest in the Walnut Creek Mining Co. joint venture in Texas.

Western Fuels-Wyoming Inc., Denver, purchased Phillips’s 50% interest in the Dry Fork coal assets in Wyoming. The North American Coal Corp., Dallas, bought the remainder of the company coal interests in Texas, Louisiana, and Mississippi.

“These transactions are consistent with our approach to focus on our core businesses and will further our efforts to reduce debt and strengthen our financial position,” said Jim Mulva, Phillips chairman and chief executive officer.

Portions of these transactions are expected to add about $18 million in net income to Phillips’s third quarter earnings, and an estimated $30 million in the fourth quarter, the company said. Cash proceeds from the coal transactions and other cash flows received in the third quarter helped reduce debt to $7.9 billion by the end of the quarter.

Phillips said it will use the proceeds of the fourth quarter transaction to pay down debt and for other corporate purposes.