Coal miner Massey 4th-qtr profit falls

NEW YORK Jan 31 (Reuters) - Massey Energy Co MEE.N said on Thursday that fourth-quarter profit fell despite rising production and sharply higher coal prices, as the coal miner ramped up its spending on projects.

Net income was $5.1 million, or 6 cents a share, compared with $8.0 million, or 10 cents, in the same quarter of 2006, the Richmond, Virginia-based company said. Quarterly produced coal revenue rose 5.3 percent to $496.6 billion from a year ago.

In October, Massey said it was spending $480 million to expand its Central Appalachian mines so it can export more and take advantage of increasing demand from the global steel industry.

The two-year plan to produce about 8 million more tons of coal would also position Massey as the dominant low-cost producer in the declining coal fields of Virginia, Kentucky and West Virginia.

According to the industry newsletter Coal & Energy Price Report, a ton of Appalachian coal is currently selling for $71.46, some 28 percent higher than a month ago. During the fourth quarter, the price had risen from $49.17 to $55.48. (Reporting by Steve James; Editing by Gary Hill)