Alpha spokesperson Rick Nida provided more information on the company’s plans on Tuesday, just days after its announcement of 4 million tons in output cuts that would leave 320 workers furloughed.
Nida said in Kentucky, Cave Spur Coal would idle its Mine No. 1 in Harlan County and the workforce would be reduced at Stillhouse Mining’s Mine No. 1, also known as Perkins Branch.
Operations will also be cut back at the complex’s associated Roxanna preparation facility.
Also in Harlan County, production crews will be reduced at Coalgood Energy’s Right Fork Splint surface operation in mid-2012.
The mine’s associated Moore processing plant will close immediately.
In Knott County, work hours and workforce for Enterprise Mining’s Big Branch West surface mine will both see reductions before closing in early 2013.
The West Virginia portion of Alpha’s Central Appalachia operations realignment includes a reduced work schedule at Run Creek Coal Sales’ Camp Branch surface mine in Logan County and Mammoth Coal will reduce production crews at its Alloy Powellton underground mine in Fayette County.
It plans to idle the No. 2 Gas underground mine in Kanawha County.
Finally, three operations in Boone County will be highly impacted by the company’s restructuring, including Inman Energy, which will idle the Randolph underground mine and Progress Coal, which will work under reduced schedules at the Twilight surface mine.
Elk Run Coal’s Black Castle surface mine will also reduce its production crews and work schedules.
“Should market conditions require it, at those operations where work schedules have been curtailed, production could be brought back swiftly,” Nida told ILN.
“Elsewhere, idled mines could be brought back over a relatively short period of time.
“Some of these properties are expected to remain permanently closed.
“[About] half of the production could be brought back relatively quickly. The other half would be more difficult.”
Alpha operations president Kurt Kost said the company wanted to give “tremendous credit” to the workers and support personnel working diligently to safely and productively mine coal.
“We’re going to do everything we can to help transition these employees who have been so dedicated to their jobs,” he said.
“All employees will receive consideration for other job openings within the Alpha family of companies.
“We’re also seeking the cooperation and involvement of state employment officials and identifying employment opportunities with other coal producers in the area.”
The 4Mt of total output being cut is made up of about 2.5Mt thermal and 1.5Mt lower quality, high-volatility metallurgical coal.
Last Friday, Alpha chief executive officer Kevin Crutchfield said weak demand for coal left the company no choice.
“We examined all options but in the end these operations had to do what was necessary to preserve a sustainable business plan in a challenging environment,” he said.
“In the days ahead, we will be examining all aspects of costs across our entire value chain, including cost reduction reviews with all key stakeholders.”
Alpha said electric utilities were switching from coal to natural gas to take advantage of gas prices at 10-year lows.
“A series of federal regulatory actions also have prompted utilities to implement plans for shutting down a number of generating stations that have traditionally run on coals sourced from Central Appalachia,” it said.
Alpha said it would have more information about the outlook for the thermal and metallurgical coal markets in its earnings conference call on February 24.
