U.S. coal shares sink on EPA emission rules plan

NEW YORK Wed Mar 28, 2012 10:30am EDT

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NEW YORK (Reuters) - Shares in U.S. coal companies slipped on Wednesday, one day after the government announced stricter emission regulations it is proposing for coal-fired power plants.

Arch Coal (ACI.N) stock dropped 3 percent to $10.92 and Peabody Energy (BTU.N) fell 2.5 percent to $29.09 in morning trading on the New York Stock Exchange. Alpha Natural Resources (ANR.N) was 2 percent lower at $15.20 and Consol Energy (CNX.N) was off 1.7 percent at $33.38.

The Dow Jones coal index .DJUSCL fell 2.66 percent.

Analysts said the decline was partly a response to Tuesday's announcement by the U.S. Environmental Protection Agency that its planned rules would limit new power plants' CO2 emissions, the first move by the world's largest economy to regulate the gas blamed for contributing to global warming.

Those CO2 rules, long dreaded by coal users, come on top of EPA pollution regulations that will drive dozens of old coal power plants into retirement.

(Reporting By Steve James)