Southern Coal deal with AEP to allow recall of coal miners

Southern Coal Corp., controlled by coal operator Jim Justice, announced Nov. 27 massive call backs and hiring of miners in southwest Virginia, southern West Virginia, and eastern Kentucky.

The company said it has worked over the last month with several customers to secure coal orders to be able to save jobs as well as reopen mines closed earlier this year. Southern Coal has entered into a multi-year agreement with American Electric Power (NYSE: AEP). Jim Justice and his son Jay, owners of Southern Coal, have been in constant negotiation with officials of AEP to be able to save jobs and restart the mines.

Nicholas Akins, President and CEO of AEP, stated: “AEP is pleased to play a role in supporting economic development in Southwest Virginia, Southern West Virginia, and Eastern Kentucky. We believe that it is important to maintain a diversified fuel mix for power generation, and that coal needs to continue to be part of that mix. This project will not only provide a secure source of reasonably priced fuel for our power plants, but it also will help fuel economic growth throughout Southwest Virginia, Southern West Virginia, and Eastern Kentucky.”

Thanks were offered to AEP, the Norfolk Southern railroad, Virginia Gov. Bob McDonnell, Kentucky Gov. Steve Beshear and West Virginia Gov. Earl Ray Tomblin.

McDonnell said: “I want to thank the Southern Coal Corporation, AEP and Jim and Jay Justice for their proactive work to save jobs and support a critically important Virginia industry. This effort will save 500 miners jobs, and another 650 new miners will be hired as well. That is great news for those miners, their families, and our Commonwealth, as well as our neighboring states of West Virginia and Kentucky.”

Beshear said: “Today’s announcement is a victory for the hard working men and women and their families in the coal counties of Kentucky, West Virginia and Virginia. The number of jobs saved and created by this multi-year agreement will benefit our region for generations to come.”

Tomblin said: “The commitment from the Justice Family, Southern Coal and AEP not only mean 1,700 jobs for our region – but it also will have a tremendous impact on continued economic growth in the surrounding tri-state communities.”

Southern Coal said that 650 new miners will be hired over the coming weeks, and an additional 500 miner jobs will be saved. Based in Roanoke, Va., Southern Coal will employ more than 1,700 people directly, and produce 9 million tons in 2013 from mines in Virginia, Kentucky, West Virginia, Tennessee and Alabama.

Southern’s various subsidiaries and affiliates controlled by the Justice family include A&G Coal, Sequoia Energy LLC, Premium Coal, Tams Management, Alabama Carbon LLC, Infinity Energy and Kentucky Fuel. Justice several years ago sold operations mostly in southern West Virginia to Mechel OAO, and since then has accumulated other mining operations in a series of deals, making him and his family one of the largest independent coal operators in the U.S.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.