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Penn Virginia buys coal, timber sites in Appalachia

Penn Virginia Resource Partners L.P. of Radnor said it bought 29 million tons of coal reserves and 56 million board feet of hardwood timber in Virginia and Kentucky for $24.5 million.

Penn Virginia Resource Partners L.P. of Radnor said it bought 29 million tons of coal reserves and 56 million board feet of hardwood timber in Virginia and Kentucky for $24.5 million.

The coal sites have been leased to International Coal Group Inc. It will sell the coal in the steam/utility and the metallurgical/steel markets.

Penn Virginia will manage the timber properties, with a contractor harvesting the wood.

The company said it expects cash flow from coal royalty payments and sales of the timber to be about $2.4 million in 2009. Penn Virginia had 2007 revenue of $549 million.

The seller of the coal and timber properties, a private party, was not identified.

Penn Virginia manages coal properties and related assets, and it operates a natural gas gathering and processing business.

Company shares were priced at $27.40 in late-morning trading, up $0.44 from yesterday's close.