Alpha Natural Resources has notified employees of eight operating affiliates in West Virginia that are subject to being idled due to sustained weak market conditions and government regulations that have challenged the entire Central Appalachian mining industry.
In accordance with requirements of the Worker Adjustment and Retraining Notification (WARN) Act, notice has been given to approximately 1,100 employees at 11 Alpha affiliated surface mines in West Virginia, as well as preparation plants and other support operations.
The operations affected are:
- Highland Mining’s Superior, Reylas, Freeze Fork and Trace Fork surface mines in Logan County and the North surface mine in Mingo and Logan Counties
- Black Castle Mining’s surface mine in Boone County
- Independence Coal’s Twilight surface mine in Boone County
- Alex Energy’s Edwight surface mine in Raleigh County
- Republic Energy’s Republic and Workman Creek surface mines in Raleigh County
- Pioneer Fuel’s Ewing Fork #1 surface mine in Kanawha and Fayette Counties
While no reductions in force are occurring immediately at these sites, they are currently planned to take place by mid-October.
Alpha reports the industry forecasts for 2015 indicate that coal production from Central Appalachia will be less than half the region’s output in 2009.
A major contributor to the demand erosion has been competition from natural gas as an alternate fuel for electricity generation in the U.S., along with competition from other coal producing basins. Additionally, EPA regulations are at least partly responsible for more than 360 coal-fired electric generating units in the U.S. closing or switching to natural gas.
Nearly one of every five existing coal-fired power plants is closing or converting to other fuel sources, and Central Appalachian coal has been the biggest loser from EPA’s actions. EPA’s new MATS air emissions rule alone is expected to take more coal-fired power generation offline next year than in the previous three years combined.
Much of that is in markets historically supplied by Central Appalachian mines.
“Many mines in the region have done a great job finding ways to reduce costs and remain economically viable in this unprecedented business climate, but some Central Appalachia mines haven’t been able to keep up with the fast pace at which coal demand has eroded and prices have fallen,” Alpha’s President Paul Vining said. “So, our operations managers have to take a hard and serious examination whether they can sustain a number of mines and related operations by finding additional cost reductions and whether the business will be there to support them in the year ahead.”
Governor Earl Ray Tomblin released the following statement in reference to the layoffs:
“The potential for layoffs and mine closures are heartbreaking and frustrating for our miners, their families and the communities in which they live. They depend on these jobs to keep food on the table and a roof overhead. My administration will closely monitor the situation and we stand ready to provide whatever assistance our miners and their families may need during this difficult time.
“We recognize market trends can play a part in these potential closures; however these actions also show the real-world impact of the regulatory environment in which industry must operate. Today’s announcement, in part related to power plant closures as a result of past EPA regulations, is why we remain concerned about the EPA’s current proposals regarding CO2.”
The mines receiving today’s WARN notifications produced 4.2 million tons of thermal and metallurgical coal through the first half of this year.
Vining said that both domestic shipments and shipments to Europe from Central Appalachia are expected to be cut back significantly, though it was too early to project exactly how much annualized production might be taken offline due to today’s announcement.
Tomblin says he urges the EPA to reconsider its proposed plan and realize the real impact these new rules have on West Virginia miners, their families and communities.