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Coal Report for May 22, 2015

Fishpond Lake in Letcher County, Ky.  Local officials decided not to hear a proposal by TECO Coal to strip-mine near the lake // photo via http://www.panoramio.com/photo/7852415

Fishpond Lake in Letcher County, Ky. Local officials decided not to hear a proposal by TECO Coal to strip-mine near the lake // photo via http://www.panoramio.com/photo/7852415

Murray Energy plans to lay off up to 1,800 coal workers, according to the Pittsburgh Tribune-Review. That number represents close to one quarter of Murray’s entire workforce. Murray mostly operates in northern West Virginia and southeastern Ohio, but also has mines in western Kentucky, Illinois, and Utah. This news of 1800 layoffs comes just after Murray announced that it was paying $1.4 billion for a controlling stake in Foresight Energy, which mines in the Illinois basin. Murray also just purchased 5 of the 6 largest-producing underground mines in West Virginia from CONSOL back in 2013. CEO Bob Murray said about the layoffs “the tide is just too high.” Industry analyst Andrew Moore from Platts Coal said that coal operators right now are “battling natural gas prices, and stockpiles continue to climb. There’s no export market to speak of. That’s resulting in mine closings and bankruptcies.”

For similar reasons, more layoffs have been announced in West Virginia. Alpha Natural Resources announced that it will idle the Camp Creek mine in Wayne County. 439 people will lose their jobs. Alpha had already laid off 135 people just this month in southeast Kentucky and southwest Virginia. The Bristol Herald-Courier reports that CEO Kevin Crutchfield Continue reading Coal Report for May 22, 2015

Coal Report for May 15, 2015

Following Patriot’s bankruptcy, UMWA miners protest against Peabody Energy, Arch Coal, & Patriot in St. Louis on Jan. 29, 2013 // image via the UMWA

Amid the downturn in the coal market, and projections by industry experts that coal doesn’t seem likely to bounce back here in Appalachia, the Obama Administration has announced more than $35 million in grants to try to help communities that have been hard-hit by the loss of coal jobs. The Mountain Eagle reports that this money comes from the federal POWER initiative that was announced earlier this spring, and these grants will go towards diversifying the economies of coalfield communities. White House Senior Advisor Jason Walsh was in eastern Kentucky last week to speak with local people both about these new grants, and also about the proposed POWER + Plan, which is still up in the air in congress. If Power Plus gets passed, the plan would also allocate $1 billion in the next five years to put people to work in the coalfields doing reclamation work on old mine sites. Walsh said that these programs were just a few of many steps that the federal government wanted to take in our region, saying “…we’ve got a lot of folks who are struggling. We need to do as much as we can as soon as possible.”

In the meantime, local miners keep losing their jobs. WYMT-TV reports that Alpha Natural Resources has announced a new round of 71 layoffs. These include 35 miners from the Tiller #1 mine in Virginia; 19 miners in total from the North Fork mine in Letcher County, Ky. and Mill Branch Coal in Wise County, Va., and 17 workers in total from the Enterprise Continue reading Coal Report for May 15, 2015

Coal Report for April 24, 2015

union-folk

UMWA protestors at a recent rally in Charleston, W.V. The Wall Street Journal reports that the UMWA’s pension fund is in trouble, though the White House has proposed federal aid // photo from the UMWA facebook page via: https://www.facebook.com/UMWAunion/photos_stream?ref=page_internal

The agreement to sell TECO Coal is still not a done deal, The Mountain Eagle reports.  The closing date for the sale has now been pushed back to June 5.  TECO is the parent company of Perry County Coal, Premier Coal, and Pike-Letcher Coal Partners, all of which operate locally.  But TECO, which also operates power utilities in Florida and New Mexico, has been trying to get out of the coal business.  Booth Energy’s Cambrian Coal Company came along as a possible buyer last year.  TECO had asked for a sale price of $170 million, but because of the weak market for local coal, the price was cut to $140 million.  And Booth will only have to pay $80 million of that cost up front, and it would only owe the other $60 million if certain production goals are reached.  So it could end up that TECO Coal gets sold for less than half of the initial asking price.

An NPR investigation last year found that thousands of mines were operating with unpaid safety fines, and also that those delinquent mines had higher injury rates.  Now, NPR reports that a new bill has been introduced in US Congress to try to hold companies more accountable.  The proposed Robert C. Byrd Mine Safety Protection Act would automatically shut a Continue reading Coal Report for April 24, 2015

Coal Report for April 17, 2015

Walter-J-Scheller

Walter J. Scheller, CEO of Walter Energy. According to a new report, Scheller received a sizeable pay increase last year even though his coal company’s stock price fell by 90% // photo via walterenergy.com

Even though many US coal companies are struggling and taking huge hits in their stock price, coal company CEOs are making even more money.  This according to SNL Energy, which reports that average pay to coal CEOs jumped 19% last year to an average of $4.9 million per executive, even though 2014 saw the coal market decline sharply across the country.  The report said that some companies will pay CEOs more in difficult times to get them to stick around.  As an example, Walter Energy, a coal producer based in Alabama, paid its CEO $6.3 million last year, more than double what he’d been paid the year before, even though Walter’s stock value fell by over 90% in that time, and is under threat of being de-listed from the New York Stock Exchange.  Arch Coal’s CEO also got $7.3 million last year, an raise of $3 million from 2013, even though Arch’s stock value fell by over 60% in that time.

Another central Appalachian coal operator has filed for bankruptcy.  The Lexington Herald-Leader reports that the Xinergy coal company is the latest.  Close to home, Xinergy owns the True Energy surface mining complex in Wise County, Continue reading Coal Report for April 17, 2015

Coal Report for April 10, 2015

memorial at the site of the Upper Big Branch mine near the town of Montcoal, W.V. the explosion at the mine happened 5 years ago this month.

Southern Coal Corporation plans to hire about 100 coal miners soon in our area, the Bristol Herald-Courier reports.  They are reportedly looking for laid-off miners and new employees alike for positions at four surface mines, including two mines in Wise County, Virginia, one in Letcher County, Ky., and another in Raleigh County, West Virginia.  These mines produce both thermal and metallurgical coal.  No timetable was given for the hires in the report.

In other coal news, an eastern Kentucky woman who has never worked at or near a coal mine has been diagnosed with black lung disease, which she says is because she lives near a coal processing plant.  Kentucky Public Radio reports that Emma Burchett of Floyd County is filing a lawsuit against Prater Creek Coal, the company that operates the plant.  She says that coal dust from the processing plant regularly ended up on her property, giving her black lung from constant Continue reading Coal Report for April 10, 2015

Coal Report for March 27, 2015

former Kentucky Representative Keith Hall, who is set to face bribery charges in April regarding coal operations he owned in Eastern Kentucky // photo form LRC Public Information

Hard times continue for central Appalachian coal. According to a report from Platts Financial, industry analysts say that 72% of the coal currently being mined in central Appalachia is unprofitable in today’s coal market. In part, we are being affected here by larger forces affecting coal all over the country, including competition from cheap natural gas and a global slump in the coal price. But what’s hurting our region so much is the fact that the so-called easy to reach coal has already been mined, and the seams that are left are more and more expensive to mine, and less and less productive. The report doesn’t say that local production is going to crater overnight because mines aren’t profitable, because many mines stay open that don’t turn a profit, whether it’s to fulfill a contract or because the owner wants to sell. But the report does warn that things don’t seem likely to get better for local coal.

In southwest Virginia, the numbers bear out the difficulties facing Appalachian coal. According to the Bristol Herald-Courier, southwest Virginia is producing just half of the coal it did ten years ago. Back in 2004, southwest Virginia produced 30.2 million tons of coal. But in 2014, that number was down to just 15.3 million. The amount of miners has shrunk as well, but not by as much as you might think—in 2004, it took more than 4,500 employees to mine those 30 million tons. Last year, it took around 3,600 employees to mine half that amount, which means that productivity per Continue reading Coal Report for March 27, 2015