CONSOL Energy (CNX 0.08%) has been discussing its plans to enhance shareholder value for a couple of quarters. A $3.5 billion coal divestment is the first step. Now CONSOL can focus on a growing natural gas market and a growing coal market.

The big deal
After alluding to forthcoming changes for months, CONSOL finally made a move, selling five coal mines and associated river transportation operations to privately held Murray Energy for $3.5 billion. That includes around 30 million tons of reserves destined mainly for U.S. power plants.

The deal allows CONSOL to materially reduce its exposure to the U.S. thermal market. That's not a bad thing for a company focusing more on growth. For example, Cloud Peak Energy (CLD) recently noted that "The domestic market has several favorable factors, which continue to help the outlook, but overall excess supply for 2014 is still holding prices down."

In other words, the United States isn't likely to be a growth market for coal in the near term. And long-term trends, like government regulations and growing natural gas supplies, are likely to leave U.S. coal demand flat to slightly lower. That's why Cloud Peak is focusing on foreign markets to spur growth, waiting on additional port access to push sales higher. CONSOL basically made the same call, but went all in—divesting U.S. assets that it sees as slow growth or worse.

A shifted business
CONSOL's decision fits well with its natural gas push, which really picked up steam when it bought land in the Marcellus Shale from Dominion Resources (D 0.35%) for $3.5 billion at the turn of the decade. While coal has struggled of late, CONSOL has focused more on growing that gas business.

And there's good reason. CONSOL expects 30% annual natural gas production increases over the next two years or so. That's a much better growth profile than domestic coal offers. And, retaining foreign coal capacity, including a fully owned coal port, has the potential to turn coal into a complimentary asset rather than a drag on performance.

Indeed, retaining ownership of the Baltimore Terminal is very important. Cloud Peak has to wait for the Gateway Pacific Terminal to be completed in 2018 before it can materially ramp up its export volumes. The Powder River Basin miner has contracted for around 15 million tons of the port's capacity. Until that port is done, however, it has limited room to expand its foreign sales.

CONSOL, on the other hand, only uses around 8 tons of its Baltimore Terminal's around 15 ton capacity. Other companies use around 5 tons of capacity. CONSOL could easily increase its exports by filling unused capacity and displacing the port's other customers.

Not everyone agrees
That said, not every coal company is down on the U.S. market. For example, Alliance Resource Partners (ARLP -0.17%) continues to post record results despite the industry's headwinds. It has been riding an industry shift to Illinois Basin coal, the region from which most of its coal is sold.

In fact, when commenting on the CONSOL transaction, Alliance admitted it would consider acquisitions, but stated that its "first priority is to grow organically."Alliance being in the right place at the right time allows for that, and CONSOL's properties weren't a good enough match.

There's different ways to skin a cat
So, while the long-term growth for coal is likely to be outside the country, Alliance is cashing in on a domestic niche and handily outperforming competitors. Cloud Peak, though struggling, is also still making money while it waits to ramp up exports. CONSOL, which has seen red ink lately, is making a shift toward growth in both its natural gas business and its remaining coal operations. That said, CONSOL is now your best one-stop shop if you like natural gas and coal's future growth prospects abroad.