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Alpha to close Boone mine

CHARLESTON, W.Va. -- Citing weak prices for steel-making coal, Alpha Natural Resources confirmed Friday that it plans to idle a Boone County underground mine that's had a history of safety problems.

About 160 workers will be affected by the closure of Alpha subsidiary Independence Coal's Justice No. 1 Mine near Uneeda and a related cutback of operations at the nearby Liberty Processing Plant.

Samantha Davison, a spokeswoman for Bristol, Va.-based Alpha, said that company officials will be meeting with miners next week to discuss pay and benefits for those impacted.

"With that said, there will be opportunities for some of the employees within the Alpha organization," Davison said in an email message.

Davison said Alpha was making the move to idle the Justice Mine "in an effort to continue to adapt to the challenging conditions in the coal market."

"Demand and price for the type of coal mined at Justice is very weak," she said.

Like other Appalachian operators, Alpha has touted a new focus on metallurgical coal -- which is used to make steel -- as the answer to the declining use of coal for power generation.

But last month, Alpha officials noted weak metallurgical coal prices, likely caused at least in part by a drop in European steel production and "the perception of slowing growth" in Chinese steelmaking.

"In general, conditions in the metallurgical coal markets remain challenging," the company said.

"However, met coal is a highly cyclical and volatile product, with the highest qualities found in relatively few locations around the globe," Alpha said. "In the intermediate to long run, the world is expected to require increasing volumes of met coal, and when market conditions improve, we believe Alpha is well-positioned to benefit from its leadership position in met coal reserves, met coal production and export terminal capacity."

Justice No. 1 was among the properties Alpha acquired in June 2011 when it purchased Massey Energy. Last year, the mine produced about 750,000 tons of coal, according to disclosures filed with the U.S. Mine Safety and Health Administration.

The Justice operation was among those targeted by MSHA for increased safety enforcement in the wake of the deaths of 29 miners in the Upper Big Branch Mine Disaster.

At Justice, miners died in separate accidents in 2000, 2002 and 2008, and in 2011 MSHA warned the company it might face stiffer enforcement for a "pattern of violations." Proposed safety fines at the mine dropped last year under Alpha's ownership, but the mine's accident rate remained worse than the national average, according to MSHA data.

Reach Ken Ward Jr. at kward@wvgazette.com or 304-348-1702.


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