Peabody reaches climate change deal with NY Attorney General

Schneiderman has announced in a press release that it has secured an agreement with Peabody Energy Corporation to end its misleading statement and to disclose to investors and shareholders the risks that arise from climate change.

Just days after President Barack Obama rejected the Keystone XL pipeline, environmentalists were handed another victory Monday morning when NY State Attorney General Eric Schneiderman released the results of an investigation that found one of the world’s largest coal companies had misled the public and its shareholders about the risks climate change could pose to its bottom line.

A two-year investigation into Peabody Energy has concluded something that two minutes with Google could probably tell you: the coal giant has been telling a few big fat lies about climate change.

“I believe that full and fair disclosures by Peabody and other fossil fuel companies will lead investors to think long and hard about the damage these companies are doing to our planet”, he said.

In its own statement, Peabody emphasized that it agreed to nothing other than changing its disclosures to investors. The investigation found that the company repeatedly denied in public financial filings to the Securities and Exchange Commission (SEC) that it had the ability to predict the impact that potential regulation of climate change pollution would have on its business, even though Peabody and its consultants actually made projections that such regulation would have severe impacts on the company. While the two investigations have a few similarities, Exxon could face tougher penalties than Peabody, said Andrew Logan, director of oil and gas programs at Ceres, an investor advocacy group. In March 2013, Peabody projected that aggressive regulation would reduce the dollar value of coal sales in its primary markets – the Southern Powder River Basin and IL Basin – by 33 and 38 percent, respectively, according to the document. The IEA, considered to be the world’s leading authority on future global energy developments, makes projections about world coal demand based on various scenarios for future world energy production scenarios.

“They’re going back in time to change what they said [in their disclosure statements]”, he said. Citigroup Inc. dropped their price objective on Peabody Energy from $135.00 to $90.00 and set a “buy” rating on the stock in a research report on Monday, July 20th.

The company had stated it could not make such predictions because of the uncertainty surrounding proposed laws. Western United States Mining and Midwestern United States segments are engaged in preparation, the mining and sale of thermal coal, which can be typically supplied to United States electricity generators and industrial customers for power generation, using a portion sold into seaborne export markets.

Through its subsidiaries, Peabody has majority interests in 26 coal operations located throughout all major US coal-producing regions and in Australia.