Alpha gives notice; plans to shut some southern West Virginia mines

Two operating affiliates of Alpha Natural Resources (NYSE: ANR) on Jan. 30 notified their employees that certain West Virginia coal mines are being idled due to sustained weak market conditions and federal government regulations that have challenged the entire Central Appalachian mining industry.

Under the federal Worker Adjustment and Retraining Notification (WARN) Act, notice has been given to about 91 Highland Mining employees, advising them of the expected idling of Highland Mining’s Superior, North, and Trace Fork surface mines, and a reduction in workforce at its Reylas and Freeze Fork surface mines. The affected mines are located in Logan and Mingo counties, W.Va. In addition, seven workers with Rum Creek Coal’s Anna Branch reclamation unit, working at the affected mines, will also be displaced. 

Approximately 25% of the affected workers will continue to perform reclamation work as three of the operations wind down to an idle state. The mine idlings and workforce reduction are expected to be completed by mid-April, Alpha said. 

These actions are being triggered by persistent weakness in U.S. and overseas coal demand and depressed price levels, along with regulatory pressures contributing to the premature retirement of coal-fired power plants across the nation. Excess supply of coal worldwide also has contributed to falling coal prices.

Alpha Chairman and CEO Kevin Crutchfield said: “We made a short term decision in November to keep these mines operating as existing coal supply contracts were being fulfilled. Unfortunately, despite the hard work of these operations to reduce costs in this unprecedented business climate, prices remain depressed and current coal supply simply exceeds demand.”

The mines that are being idled produced 1.5 million tons of thermal coal in 2014. 

“These actions are consistent with steps that we’ve taken in the past to build a smaller but more sustainable portfolio of mining assets across our operational footprint,” Crutchfield added. “We are confident that a portion of the displaced miners will be able to fill available positions at other Alpha-affiliated mines.”

Alpha Natural Resources is one of the largest and most regionally diversified coal suppliers in the United States. With affiliate mining operations in Virginia, West Virginia, Kentucky, Pennsylvania and Wyoming, Alpha supplies metallurgical coal to the steel industry and thermal coal to generate power to customers on five continents. It largely obtained the mines subject to these layoff notices in a June 2011 buy of Massey Energy.

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.