January 31, 2011
Will Alpha improve Massey safety and environmental performance?
Page 2 of 2
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Scrutiny of Massey increased after two mines died in a January 2006 fire at Massey's Aracoma Mine, an incident that produced record safety fine of $4.2 million in civil and criminal fines.

But it was the April 5, 2010, explosion that killed 29 workers at Massey's Upper Big Branch Mine that began a downward financial spiral, with Blankenship retiring in early December and Massey's board agreeing less than two months later to a buyout.

While Alpha has avoided a huge disaster like Upper Big Branch, the company came dangerously close to such an incident in May 2009, when seven workers were trapped underground for more than 24 hours by a mine flood in Mingo County. Federal regulators cited the company for improper maintenance of outside drainage systems that allowed heavy rain to inundate the underground tunnels.

And in January 2007, Alpha's Brooks Run subsidiary was cited for major safety violations following a roof collapse that killed two workers at an underground mine in McDowell County.

In terms of production, Alpha already ranked higher than Massey among U.S. coal operators, largely because more than half of its 84 million tons of 2009 coal output came from two huge surface mines in Wyoming's Powder River Basin.

Alpha ranked fourth in 2009 West Virginia production. Corporate disclosures listed about 1,700 employees in the state.

Formed in 2002, Alpha grew over the next decade by purchases of Pittston Coal -- another old UMW foe -- from Brinks, and of Coastal Coal, Nicewonder Coal, Progress Fuels and of some West Virginia operations of Arch Coal.

Two years ago, Alpha also purchased some of the holdings of Foundation Coal, including two large underground mines that employ more than 1,000 UMW members in Greene County, Pa.

Roughly three-quarters of Alpha's employees and slightly more of its production base are still "union free," and the company warns shareholders that additional unionization "could adversely affect the stability of our production and reduce our profitability."

Roberts, the UMW president, said that unlike at Massey, his union has "open lines of communications" with Alpha.

On the Upper Big Branch disaster, Alpha officials said that they had carefully examined Massey's estimates of the potential financial impacts of the disaster, any litigation and any government investigations and were "comfortable with the risk" involved in buying Massey.

"It was a tragic event and what we would hope for is resolving the matter in the foreseeable future," Crutchfield said.

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

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