Peabody (BTU) Q3 2026 Earnings Call: Centurion Guidance Cut

Peabody Energy (NYSE: BTU) reported a narrower third-quarter 2026 loss and higher adjusted EBITDA as stronger seaborne coal pricing and improved thermal volumes offset continued production constraints at Centurion.

Key Takeaways

• Net loss attributable to common stockholders narrowed to $32.8 million, or $0.27 per diluted share, from $90.6 million, or $0.74 per share, in Q2 2026.
• Adjusted EBITDA increased to $97.5 million, supported by higher Centurion production, stronger realized seaborne prices and improved U.S. thermal volumes.
• Centurion met its Q3 sales target, but complex faulting reduced October production to just over 45,000 tons. Management revised Q4 Centurion sales guidance to 300,000–500,000 tons.
• Seaborne Thermal adjusted EBITDA reached $65.5 million, up 26% sequentially and 60% year over year. The company expects stronger Q4 production from Wilpinjong and Wambo.
• Peabody ended Q3 with $434 million in cash and $887 million in liquidity. Through September 30, it returned $192 million to shareholders during 2026.
• Full-year guidance was reduced by 600,000 tons for Seaborne Metallurgical coal and 7.5 million tons for Powder River Basin shipments. Capital expenditure guidance was lowered by $40 million.

Core Financial Data

Business and Operating Performance

Centurion

Centurion achieved its Q3 sales-volume target, but the longwall encountered multiple complex geological structures across the tailgate, face and headgate. Management said the faulting was known but proved more complex than assumed in the mine plan.

Approximately 110 meters remained before the longwall moved beyond the major fault structure. Peabody plans two equipment upgrades: a $1.5 million–$2 million base-lift power increase during scheduled maintenance and $5 million–$10 million of shield extension flipper improvements during the next longwall move in 2027.

The company is also using pre-consolidation work to stabilize faulted areas. Management said the issues do not change its view of Centurion’s resource quality, reserves or long-term mine plan.

Seaborne Thermal

Seaborne Thermal shipments totaled 3.1 million tons, including 2 million export tons. The average realized export price exceeded $100 per ton. Compared with the prior-year period, revenue per export ton rose by nearly $24, while costs increased by about $7 per ton.

Newcastle coal averaged approximately $135 per ton during Q3 and ended the quarter above $145. October spot API 5 pricing reached $115 per ton, its highest level since May 2023.

Seaborne Metallurgical

Shipments reached 2.2 million tons, helped by higher Metropolitan production following a faster-than-planned longwall move. Revenue per ton increased 11% sequentially to $165, while costs were $162 per ton, reflecting faulting and lower Centurion output.

The segment recorded its first positive adjusted EBITDA quarter of 2026. Premium hard coking coal averaged $248 per metric ton in Q3, up 35% year over year, with spot prices peaking at $285.

U.S. Thermal

Powder River Basin shipments rose to 19.6 million tons, while costs improved 8% to $12.94 per ton. The basin generated $15 million of adjusted EBITDA, although cooler weather, strong renewable generation, low natural gas prices and a customer plant outage constrained demand.

Other U.S. Thermal operations shipped 3.4 million tons and generated $25.5 million of adjusted EBITDA. Lower coal burn at Bear Run and an extended customer generation-unit outage affecting Twentymile reduced shipments.

Management Guidance

Approximately 1.6 million tons of Newcastle product and 0.8 million tons of higher-ash Wilpinjong product remained unpriced for Q4.

Peabody increased full-year Seaborne Thermal export-volume guidance by 200,000 tons. However, lower Centurion expectations reduced full-year Seaborne Metallurgical volume guidance by 600,000 tons and increased expected costs by $15 per ton.

The company also lowered full-year Powder River Basin volume guidance by 7.5 million tons, raising expected full-year costs by $1 per ton. Other U.S. Thermal guidance was reduced by 200,000 tons. Capital expenditure guidance fell by $40 million, mainly due to deferred Centurion North development.

Risks and Areas to Watch

• Centurion execution: Production remains constrained by complex faulting, ground pressure and roof conditions. Consistent nameplate performance depends on completing equipment modifications and pre-consolidation work.
• Timing uncertainty: Management expects Centurion to reach higher production rates after clearing the current faulted area, but more consistent performance is tied to the next longwall panel and planned 2027 modifications.
• U.S. thermal demand: Coal burn remains exposed to winter weather, natural gas prices, renewable generation and customer plant availability.
• Pricing exposure: A portion of Q4 Seaborne Thermal production remained unpriced at the time of the call.
• Project timing: Management said potential electricity demand from data centers, manufacturing and electrification had not yet translated into materially higher coal purchases.

Analyst Q&A Highlights

Management reiterated that Centurion’s faulting is concentrated in the current area and does not alter the mine’s long-term production outlook. Jim Grech said the company remained fully confident that Centurion could reach full capacity.

Management expects higher run rates after the longwall clears the remaining 110 meters of the major fault structure. However, it indicated that sustained performance around the targeted 1 million-ton run rate would be more likely after the next longwall move, when all planned equipment modifications are in place.

Peabody did not provide 2027 mine guidance. The company said it would assess Q4 progress and provide updated guidance on its next earnings call. Management also maintained its long-term view of Centurion’s operating costs, stating that the planned equipment modifications should not increase ongoing mining costs.

For Seaborne Thermal, management said Wambo should remain around 3 million-plus tons annually. Wilpinjong export volumes could decline by roughly 500,000–700,000 tons year over year in 2027 before increasing as domestic deliveries fall, with export volumes targeted to rise from slightly above 5 million tons in 2026 to more than 10 million tons by 2030.

Full Earnings Call Transcript

Complete Earnings Call Transcript

Management Remarks

Operator

Good day, and welcome to the Peabody Third Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Kala Finklang, Vice President, Investor Relations and Corporate Communications. Please go ahead.

Kala Finklang

Thanks, operator, and good morning, everyone. We appreciate you joining us for Peabody's Third Quarter 2026 Earnings Call. Joining me today are Peabody's President and CEO, Jim Grech; Chief Financial Officer, Mark Spurbeck; and Chief Commercial Officer, Malcolm Roberts. After our prepared remarks, we will open up the call for questions.

Before we begin, I want to remind you that our remarks today will include forward-looking statements. Please review the statement contained in our earnings release and consider the risk factors referenced there, along with our filings with the SEC.

I'll now turn the call over to Jim.

Jim Grech

Thanks, Kala, and good morning, everyone. The third quarter marked a meaningful step forward for Peabody. We continue to advance Centurion, generated positive adjusted EBITDA across each operating segment and benefited from improved seaborne markets.

Underpinning everything we do is our commitment to safety. Our teams maintained their focus on safe execution while delivering on the strategic priorities that will help position the company for stronger performance heading into year-end.

Our #1 priority is Centurion, which met its third quarter sales volume target. However, late in the quarter and into October, the longwall encountered faulting across multiple locations that proved more problematic than anticipated and constrained production. October production was just over 45,000 tons, and we have revised our fourth quarter sales volume expectations to a range of 300,000 to 500,000 tons.

The challenge is not a single fault or a isolated geological event. The longwall has encountered multiple complex geological structures across the tailgate, face and headgate areas, and the combination was more complex than our mine plan assumed. Mechanical downtime while navigating these faulted zones allowed additional ground pressure and roof conditions to develop ahead of the phase.

Under these circumstances, elements of the current longwall design were less effective at managing changing conditions than expected, which further slowed progress. Importantly, we do not view these challenges as a resource quality, reserve or long-term mine plan issue. Faulting and structural complexity are common characteristics of Bowen Basin operations. What this first panel has shown us is where our equipment and operating practices need to adapt to operating efficiently in these conditions.

In the current panel, we have approximately 110 meters to go before the major fault structure is behind the longwall. We still expect some geological interruptions throughout the remainder of the panel. Our team has identified targeted engineering modifications and operating adjustments that will give us greater flexibility when mining through similar conditions in future panels.

For each longwall shield, there are 2 key equipment upgrades being scheduled around planned downtime to limit disruption to production. The first is a base-lift power increase estimated at $1.5 million to $2 million total for all shields, which we plan to complete in the current panel during scheduled maintenance.

The second is improvements to the shield extension flipper estimated at $5 million to $10 million total for all shields, which we plan to install during the next longwall move in 2027. We have also worked to mitigate the risk of the next panel with an extensive pre-consolidation plan for the faulted zone. Where we do encounter faulting, we will be better prepared with improved longwall positioning, both equipment upgrades in place and steps to stabilize and strengthen the ground ahead of the fault. Together, these steps are designed to deliver more consistent longwall performance at Centurion, while our focus continues to be on safe execution.

Beyond our current operating priorities, responsible stewardship remains central to how we manage our assets throughout their life cycle. Peabody received the Office of Surface Mining Reclamation and Enforcement's National Award for Excellence in Reclamation, the highest honor in this field for work at the former Seneca II West Mine in Colorado. Since the mine's closure in 2009, reclamation has transformed the site. This national recognition underscores the lasting impact of our commitment to responsible reclamation.

That same focus extends to Peabody development, which is pursuing new ways to create value from our land and resources. Based on promising germanium concentrations, we are nearing agreements with a major customer and a processing partner. Through our R3 joint venture with RWE, we are advancing solar and battery storage projects on reclaimed mine land with potential success fees beginning in 2027. We're also evaluating opportunities to pair mine-mouth generation with data centers. Our approach remains capital-light and partnership-driven, positioning us for new revenue streams and long-term growth.

Turning to the U.S. regulatory environment. As the nation faces rising electricity demand, EPA's partial repeal of the power plant carbon rule, which required unproven and uneconomical technology and its proposal to resent the engagement finding represent important steps toward restoring a more common sense energy policy for our country. I commend the DOE, EPA and the Trump administration for recognizing the critical role of reliable, dispatchable and affordable energy.

With that perspective on our operations and the regulatory environment, I'll turn the call over to Malcolm to discuss the U.S. and global market fundamentals.

Malcolm Roberts

Thanks, Jim, and good morning, everyone. Building on Jim's overview, I'll discuss the market conditions shaping customer demand. The third quarter featured stronger seaborne pricing driven by continued supply constraints and steady demand. China remained the primary driver of metallurgical coal pricing. Seaborne Thermal coal market strengthened primarily because of healthy North Asian demand and supply constraints persisting in Indonesia and domestically in China. In the U.S., thermal demand improved during the quarter. However, it remains down year-over-year on a year-to-date basis.

Starting with Seaborne Metallurgical coal. Premium hard coking coal averaged $248 per metric ton in the third quarter, up 35% year-over-year and the highest quarterly average since early 2024, with spot index prices peaking at $285. As lower Chinese production resulted in Chinese metallurgical coal imports increasing 25%. Chinese safety inspections and production restrictions in Shanxi following the major mine accident in May have particularly affected high-quality coking coal supply.

An estimated 70 million tons of Chinese domestic metallurgical coal production have been removed from the market year-to-date. For context, the global Seaborne Metallurgical coal market is approximately 80 million tons per quarter. Supply is expected to remain constrained into 2027, supporting seaborne pricing.

In India, metallurgical coal buying has been steady but remained selective. Stronger steel prices following the monsoon season slowdown leaves scope for higher imports during the fourth quarter. While tighter Russian PCI supply has renewed Indian buying interest in supply from Australia, through September, premium coking coal and PCI prices were up 31% and 19%, respectively, versus 2025.

Against this backdrop, we completed additional spot sales to major Chinese steel producers, advanced 2027 term discussions and delivered an initial Centurion cargo to an Indian public sector steel producer. U.S. high-vol A coal prices have improved this year, but the price discount to Australian premium hard coking coal remains material as incremental supply and freight costs weigh on the delivered competitiveness in Asia.

Renewed Chinese access with an anticipated lower Chinese import tariffs could improve demand when implemented. Recent U.S.-China trade discussions have outlined China's commitment to at least 11 million tons of U.S. origin imports in '27 and 2028. This import volume is anticipated to be primarily coking coal. Any resulting trade flow shifts are expected to be broadly neutral for Australian pricing.

Turning to Seaborne Thermal coal. Newcastle pricing averaged approximately $135 per ton during Q3, trending higher to finish the quarter above $145 per ton. Price support came from several factors, elevated LNG prices, slower Chinese production and lower Indonesian exports. China has showed continued interest in Australian thermal coal, particularly for mid-calorific higher ash products looking to substitute constrained Russian and Indonesian supply. As a result, API 5 pricing increased through the quarter and October spot API 5 pricing accelerated even further, reaching $115 per ton, the highest level recorded for the index since May 2023.

Shifting to the United States. Third quarter Powder River Basin sales fell below guidance as cooler weather early in the quarter, strong renewable generation and low natural gas prices weighed on coal demand. An unplanned extended customer plant outage also reduced shipments. This winter's demand profile will be particularly dependent on the El Nino weather pattern, gas prices and renewable output.

Looking beyond the near term, data centers, manufacturing and electrification point to sustained electricity demand growth. That potential has yet to translate into materially higher coal purchases. Project timing will remain a risk. In summary, seaborne markets remain constructive with supply constraints and energy security considerations supporting both metallurgical coal and thermal coal. U.S. Thermal fundamentals are more mixed, but coal continues to provide reliable supply of electricity during periods of high demand.

With that, I'll turn the call over to Mark for a review of the financial results and the fourth quarter outlook.

Mark Spurbeck

Thank you, Malcolm, and good morning, everyone. With that backdrop, let's review our financial results, capital structure actions and outlook for the remainder of the year.

Peabody reported a third quarter net loss attributable to common stockholders of $32.8 million or $0.27 per diluted share, a much narrower loss compared to $90.6 million or $0.74 per diluted share in the second quarter. Adjusted EBITDA increased to $97.5 million, still below the steady-state mid-cycle run rate as we await Centurion's full ramp-up.

The improved results were driven by higher production at Centurion, higher average realized seaborne prices and better U.S. Thermal volumes. Costs per ton were higher than anticipated due to lower-than-expected third quarter U.S. Thermal volume and higher cost faulted conditions slowing production at Centurion.

I'll now walk through the segment results. Seaborne Thermal shipped 3.1 million tons, exceeding expectations by 100,000. Export shipments were 2 million tons, also above guidance, and the average realized export price exceeded $100 per ton, further expanding margins. Compared to the prior year period, revenue per export ton increased nearly $24, while costs have increased about $7 per ton.

The segment reported adjusted EBITDA of $65.5 million, increasing 26% from the second quarter and 60% from the prior year period. We are anticipating an even stronger fourth quarter with higher production from both Wilpinjong and Wambo selling into very strong seaborne energy coal markets.

Seaborne Metallurgical shipped 2.2 million tons, exceeding company expectations, driven by higher production at Metropolitan following a quicker-than-planned longwall move. Revenue per ton increased 11% from the second quarter to $165. Costs were above target at $162 per ton, primarily reflecting higher cost faulted conditions and lower production at Centurion. The segment turned in its first positive EBITDA quarter of the year and with higher volume at Shoal Creek and Coppabella, we are expecting a stronger fourth quarter. Our U.S. Thermal business generated $40.5 million of adjusted EBITDA, more than double the second quarter result.

In the Powder River Basin, shipments increased to 19.6 million tons. Together with cost-focused management, costs improved 8% to $12.94 per ton, but remained above target due to lower-than-anticipated volume as a result of lower coal burn. The segment generated adjusted EBITDA of $15 million. The other higher calorific value U.S. Thermal business shipped 3.4 million tons, 300,000 less than anticipated. Lower shipments at Bear Run are due to lower coal burn and a Twentymile customer had a generation unit down for an extended period.

The resulting mix increased average cost per ton above expectations in the quarter, partially offset by higher average realized revenue per ton. The segment generated $25.5 million of adjusted EBITDA, broadly consistent with the second quarter.

Turning to the balance sheet. We ended the quarter with $434 million of cash and $887 million of liquidity. In the third quarter, we repurchased $39 million of the remaining 2028 convertible notes for $58 million and issued a call for the remaining $40 million, electing cash settlement with an anticipated mid-November closing. The cash repurchase completed in the third quarter continued our return of capital to shareholders with a $19 million cash premium representing an additional 700,000 shares repurchased, bringing the year-to-date amount to 5.7 million shares. Together with $27.4 million of cash dividends, we have returned $192 million to shareholders in 2026 through September 30.

Looking ahead to the fourth quarter, Seaborne Thermal volume is expected to be 3.6 million to 3.8 million tons, including 2.5 million to 2.7 million export tons. Approximately 1.6 million tons of Newcastle product and 0.8 million tons of higher ash Wilpinjong product remain unpriced. Costs are expected to be between $46 and $51 per ton. Significant improvement compared to the third quarter is driven by substantially higher volume from Wambo as a result of mine sequencing, improving quality mix to approximately 65% Newcastle, 35% higher ash coal. Strong performance through the first 9 months of the year has allowed us to increase full year Seaborne Thermal export volume guidance by 200,000 tons.

Seaborne Metallurgical volume is expected to be 2.2 million to 2.4 million tons as higher volume at Shoal Creek and Coppabella offset lower volume at Centurion as we work through the difficult faulting conditions that Jim discussed. Realizations are expected to average approximately 70% of the premium hard coking coal index with cost of $150 to $160 per ton. Lower fourth quarter expectations at Centurion resulted in a reduction to full year Seaborne Metallurgical volume of 600,000 tons and increased costs $15 per ton.

Powder River Basin shipments are expected to be 19.5 million to 21.5 million tons at an average price of approximately $13.75 per ton at cost of $13 to $13.50 per ton. With the lower coal burn during the third quarter and modest Q4 forecast, we have lowered full year volume by 7.5 million tons, increasing full year costs by $1 per ton.

Other U.S. Thermal volume, which has an average calorific value greater than 11,000 Btu is expected to be 3.6 million to 4 million tons at an average price of approximately $59 and cost of $48 to $52 per ton. Similar to the PRB, we have lowered full year volume guidance by 200,000 tons due to lower anticipated coal burn.

Capital expenditure guidance was reduced by $40 million, primarily related to opportunistic deferral of development at Centurion North. In closing, Peabody exits the quarter in strong financial position, poised to leverage our diversified assets to generate free cash flow from strong seaborne markets.

With that, I'll turn the call back to Jim.

Jim Grech

Thanks, Mark. Peabody's opportunity is clear; build on the strength of our thermal businesses, realize Centurion's long-term potential and unlock additional value from our asset base. Delivering on that opportunity starts with safe, reliable operations and disciplined cost management. We recognize the work ahead at Centurion and remain focused on demonstrating improved progress. Our responsibility is to translate the strength of this portfolio into lasting value for our shareholders.

With that, operator, we are pleased to open the call for questions.

Operator

[Operator Instructions] The first question comes from Chris LaFemina with Jefferies.

Question-and-Answer Session

Christopher LaFemina

I just want to ask you about Centurion. So the plan was to initially get through the complex faulting area, which you had hoped to achieve by mid-October. But now you've encountered additional faulting problems, and these seems to be spread throughout the mine. It sounds like this has gone from being getting through the complex faulting and then kind of going about on your prior mine plan to now trying to figure out how to manage through this faulting because it's more likely to be a potentially permanent feature in the mine. Is my interpretation of that correct?

Jim Grech

Chris, the faulting that we have is still in this localized area that we're trying to get -- that we are getting through that we've talked about earlier. And once we get beyond this 110 meters in this panel, the majority of this faulting goes away. So our outlook on the faulting and the geology in this panel and the rest of the mine hasn't changed and our outlook for the ability to mine the coal as we get to the subsequent panels hasn't changed.

There is faulting across the mine as it is in all the mines in the Bowen Basin. And what's occurring is, as we're getting through this first panel, we're learning how we have to adapt our equipment to handle this faulting better in some of our operating procedures. So nothing has changed in our outlook on the mine or the faulting. This faulting was known to be there. We had it mapped out. It just turned out to be more complex than we thought it was going to be.

Christopher LaFemina

So the faulting throughout the rest of the mine, how do we know that it's not more complex than you had initially assumed it to be? If you've had a problem with this particular area, how do we know what is going to happen with other faulting areas in the longwall?

Jim Grech

Yes. What we've learned with both the equipment that we have and the modifications that we have and then the pre-consolidation where we have had the faulting and have done the pre-consolidation. We've had a lot better success at mining through that. This area here, though, we did not have the pre-consolidation done to it, but we have it in the rest of the panel here where we do have faulting and we'll be doing it in the panels going forward.

So, the pre-consolidation and the equipment modifications to handle the conditions when we get them, when we encounter them, give us a lot higher degree of confidence of being able to mine through them efficiently in the future.

Christopher LaFemina

Okay. So your confidence in getting to full capacity at this mine has not changed even with these problems that you're encountering right now? That's my last question.

Jim Grech

That's correct. Yes, Chris, we're 100% still going to get to full capacity. And again, this first panel has been a learning experience for us and what we need to do to get to that full capacity. And with the planned equipment modifications that I outlined in my comments, the pre-consolidation and the experience we're learning in this first panel, we're still 100% confident we're going to get to the full output capacity of this mine.

Operator

The next question is from Katja Jancic with BMO Capital Markets.

Katja Jancic

Maybe staying on Centurion. So Jim, you mentioned you're confident that you can get to full capacity. But can you maybe talk a bit more about when you could get there, what the time line is?

Jim Grech

Yes. As we get through these faults in this quarter here and early next year, while we're finishing up this panel, we'll do these equipment modifications that I talked about. Some of them we can do during this -- while we're in this panel and some we'll do during the next longwall move. And we'll be doing the pre-consolidation in the next panel ahead of us getting there.

So as we get through this panel, certainly, as we get into the next panel after this longwall move, we will be at that full capacity potential. But we still have to work through this right now as we do these equipment modifications while we're mining through this panel. But the next panel, we should be ready to go.

Katja Jancic

So if I understand correctly, when you get -- when you do the longwall move in 3Q of next year, that's when you could get to that 1 million ton run rate? Or how should we think about it?

Jim Grech

Yes, that's when we -- with the modifications, we'll feel like we're much more consistently -- we'll be operating consistently and getting to that run rate. Now as we're in this panel and we get through this faulting area, we'll get to those high run rate levels once we get past the faulting, this 110 meters we have left. But we won't have those modifications then Katja. So in order to consistently keep that run rate, whether there's faulting or not, we need to get these modifications done.

Operator

The next question is from Nick Giles with B. Riley Securities.

Nick Giles

Maybe just on 4Q specifically, I think 45,000 tons in October still implies something around 175,000 tons per month. So can you just kind of give us a picture of exactly where things stand today? Like is the longwall running? And if so, how many passes are you able to make given the faulting issues? And how much of these sales volumes would come from inventory that's on the ground?

Jim Grech

Yes. Right now, the longwall is running, but not at the rates that we're hoping to get to once we get -- that we will get to once we get past this faulted area here, which we expect to be out of later this week. The problematic area, and we still have to get through the 110 meters that we have left. And we had coming into the quarter about 50,000 tons of inventory, and we've got another 125,000 tons that we know that we'll get from our CM units. And so the remainder would be coming from the longwall, and we feel pretty good about those numbers -- attaining that guidance range with the tons off the longwall for the rest of the quarter.

Nick Giles

Understood. And I was hoping you could give us an early sense for how you're going to guide at Centurion in 2027. I mean, obviously, there's been a number of challenges. Guidance has been consistently downgraded. So it seems like you're still confident you can reach full capacity, but are you willing to set the bar lower just in case that some of these problems do persist?

Mark Spurbeck

Nick, it's Mark. Yes, we're not prepared to share what we're going to do with 2027 guidance for any of our mines yet. We're going to look at it. We're going through our budgeting process. Clearly, we want to see our progress here in the fourth quarter. But I think the most important point is what Jim mentioned earlier that our long-term outlook has not changed. But we'll work through these modifications with the equipment that Jim mentioned, and we'll come up with guidance in our next call.

Nick Giles

Maybe just switching gears. I was hoping you could just give us a sense for Seaborne Thermal costs, kind of how you're seeing those trending? What impact -- what incremental impact are the higher diesel prices having here in the fourth quarter? Or what kind of operational improvements have you been able to make to kind of keep those costs more range bound?

Jim Grech

Yes. In the U.S., I assume you're talking about in PRB, certainly, you saw us raise the expectation of costs on higher diesel and lower expected volumes. It's probably maybe $0.50 a ton in the PRB. But that guidance, we're comfortable with that. Diesel has come up a little bit from where we expected. In Seaborne Thermal, you've seen a pretty significant reduction in our costs quarter-over-quarter going into the fourth quarter.

You can see by the volume, we're up significantly at Wambo and Wilpinjong. So that's really driving the lower cost. There's some diesel impact there, but not significant. So the lower cost getting us into that $46 to $51 range is driven by the higher volumes, offset partially by some higher sales-related costs given the better pricing environment.

Operator

The next question is from Nathan Martin with StoneX.

Nathan Martin

Just a clarification, I guess, the 200,000 additional Seaborne Thermal export tons now expected for this year, it sounded like, Mark, you said those are largely expected from Wamba, so are those Newcastle quality tons?

Mark Spurbeck

That's right. Higher Wamba production, higher Newcastle. You saw us move the weight there kind of 65-35 off of our traditional 50-50.

Nathan Martin

Okay. Got it. And then on the production and expected U.S. Thermal sales for this year, I assume most of those tons just roll into next year. And then maybe can you give us an idea of how contracted you guys are for '27 in the U.S. Thermal segments and any idea on pricing?

Malcolm Roberts

Yes. Nate, Malcolm here. Look, we haven't given guidance for next year. But we'd expect our contract position from this year to roll into next year, probably with an expectation of a few additional tons in the PRB and similar volumes in the other segment. But yes, that's still going to come down to guidance, which we'll update at the next call.

Nathan Martin

Okay. Appreciate that, Malcolm. And maybe coming back to Centurion for a second. I think last quarter, Jim, you mentioned you guys are looking at ways to shorten the duration of the longwall move, which is now expected in the third quarter '27. Did you make any progress there? And how long would you expect that longwall move to take?

Jim Grech

Yes. We're working on the timing of that, Nathan, with the advance that we're doing right now, but the development is well in place for the next longwall move, the 7 panel. So we've made very good progress there. So we're actually ahead of schedule on the development for the next panel. But when we give the guidance for next year, we'll talk about the timing of the longwall move and when that will be occurring.

Operator

[Operator Instructions] The next question comes from Matthew Key with Texas Capital.

Matthew Key

Just staying on Centurion. Well, I know the expectation is that Centurion will get back to -- get to nameplate capacity. But just given the mine conditions that have been maybe a little bit more persistent, should we expect that Centurion will just be a higher cost producer than maybe what was originally expected for it, like as it came online?

For example, even if mining conditions stabilize, I know you've incorporated some equipment modifications to kind of better address those challenges. Do those modifications just inherently increase mining costs compared to what was originally expected when you broke ground on that asset?

Mark Spurbeck

Matt, it's Mark. The equipment modifications Jim mentioned are very modest capital. They will not increase the operating cost of this mine going forward. Certainly, the geological conditions have been more problematic than we anticipated in this panel. The equipment modifications are meant to address that as well as the learnings we've had from the additional drilling and consolidation work that we've done in this panel. So we think we know how to operate this mine.

Jim confirmed that we still anticipate getting to that full production. So our long-term view of costs have not changed. Again, that was $105 a ton in 2024, you inflate that up, and we shouldn't be at that $125 range or whatever next year. We have a lot to learn. We're still working through this. So give us another quarter here, and we'll provide full guidance on our next call.

Matthew Key

Got it. That's helpful color. I appreciate that and good to hear. Just on Seaborne Thermal, I know we'll have more guidance in the next quarter. But just at a high level, in regards to kind of the production outlook there, could you remind me like the big moving parts directionally from a production standpoint in Seaborne Thermal? Just want to make sure I'm accounting for everything correctly in my model.

Mark Spurbeck

Yes. I think we've shared what we think Wilpinjong will do, right? We've got a transition to a couple of pit extensions. So the production came off a little bit this year. It will come off a little bit more next year. Depending on where we finished the quarter on the domestic ton deliveries, it will depend on how much we have to deliver next year. But I think we're in that 4.4 million ton range again on the domestic side. So maybe you'll see a drop in the export tons year-over-year next year, somewhere in that 500,000 to 700,000 range.

And I would look at Wambo as being pretty consistent at 3 million plus a year. So as we mentioned, then that domestic delivery out of Wilpinjong retreats significantly in 2028 to only like 2 million, 2.5 million tons and goes away completely after that. So we look to ramp up those export tons out of Wilpinjong from a little over 5 million this year to over 10 million by 2030.

Operator

Next, we have a follow-up question from Nick Giles with B. Riley Securities.

Nick Giles

I think you mentioned or you made an update on some of these opportunities outside your traditional business, let's call it, specifically on the germanium front. Can you just walk us through kind of what the gating items are to advance that opportunity and the same for the kind of mine-mouth generation opportunities?

Jim Grech

Yes. Nick, on the germanium, as I said in the remarks, we're working to an agreement with a partner to -- for the offtake and the processing on that. And hopefully, that announcement can be coming sometime here in the near future. And because of some of the commercial sensitivity of that nature, we don't want to give a lot of details out of that deal until we have this all buttoned up and make the announcement. But again, we think it's a very promising opportunity for germanium production and the offtake and the processing.

On the mine-mouth power plants that you're asking about, what we're looking for there is partners -- the way we're going to see the revenue from that is from either the land sales or the sale of coal to the mine mouth generation or from helping the project development fees. So we're looking for the partners to build and operate the asset.

So, again, we're just in early days of that. There is a lot of interest in the mine mouth generation in the state of Wyoming. And we're into those conversations in case that potential develops more. But right now, it's very early days with that.

Nick Giles

Maybe just one more on the kind of legacy operations, specifically at Coppabella, low-vol PCI prices have been ticking up. So I think, Mark, you mentioned some higher output from that mine in 4Q. But are there any opportunities to run that mine a little harder and take advantage of some of the spot strength?

Mark Spurbeck

Nick, I think we've kind of transitioned from a 2-mine operation at Moorvale and moved a lot of equipment into Coppabella. That's where our focus is in stabilizing that production going forward. We've been mining through some higher ratio coal. We're getting through that as well to some lower ratios. So I look forward to strong production, but there's not a step change in production that's kind of on our vision today.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Jim Grech, CEO, for any closing remarks.

Jim Grech

Yes. Well, thank you to everybody for your time today and your continued support, and we look forward to updating you on our progress in future calls. Thank you.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.