July 28 (Reuters) - Coal and natural gas producer Consol Energy Inc said it was delaying a planned initial public offering of a unit holding steel-making coal assets due to weak prices.
The company, which has been looking to lower its exposure to weak coal prices, also reported a much bigger quarterly loss, hurt by an $829 million impairment charge on its oil and gas assets.
Consol said it was now looking at partnering with a third party to grow its met coal unit before taking it public.
Consol took a unit holding power-generating coal assets public in April as part of a broader strategy to shift its focus to natural gas production.
A second coal unit holding metallurgical, or steel-making coal, assets was supposed to go public in the fourth quarter, but Consol said on Tuesday it was putting the IPO “on hold”.
Prices for metallurgical coal have slumped due to week Chinese demand, while thermal coal prices have been hit as power producers shift to cheaper and cleaner natural gas.
Consol’s shift to natural gas production has not been successful because of a steep decline in prices for the fuel amid a supply glut.
Southeastern Asset Management Inc, Consol’s largest shareholder, said in a filing on July 20 that it plans to meet the company and others to discuss a possible “monetization” of the gas unit, including a spinoff or a sale.
Consol’s net loss widened to $603.3 million, or $2.64 per share, in the second quarter ended June 30, from $24.9 million, or 11 cents per share, a year earlier.
Excluding items, Consol reported a loss of 37 cents per share.
The company’s revenue dropped nearly 31 percent to $648.9 million.
Up to Monday’s close, Consol’s stock had fallen nearly 49 percent this year, compared with a 57 percent drop in the broader Dow Jones U.S. Coal index. (Reporting by Anet Josline Pinto and Manya Venkatesh in Bengaluru; Editing by Maju Samuel)