Citing weakness in the thermal coal market, Arch Coal on Thursday announced it will lay off 750 workers in West Virginia, Kentucky and Virginia this summer.
One of the operations to be closed is the Eastern complex near Cowen in Webster County. The Eastern complex includes underground and surface mines and a preparation plant, according to the Arch Coal website.
"The best way to think about the workforce reduction related to the 3 million ton production curtailment is 19 percent West Virginia, 2 percent Virginia and 79 percent Kentucky, so West Virginia would have less than 150 jobs lost," said Arch Coal spokesperson Kim Link.
"I've been told that Eastern complex notified 122 employees today. The other jobs lost to get to about 150 total were in the most recent weeks prior to today."
In a statement released shortly after 5 p.m., Arch said it will close three higher-cost thermal mining complexes and associated preparation plants, temporarily idle Hazard's Flint Ridge complex and curtail production at other operations in Kentucky, Virginia and West Virginia. The mine locations affected by the announced closings are the East Kentucky, Eastern and Knott County complexes.
"We deeply value our people, and the decision to reduce personnel was made only after exhaustively reviewing other options and exploring opportunities to avoid this measure," John W. Eaves, Arch's president and CEO, said in a news release issued shortly after 5 p.m. "We sincerely regret the impact this announcement will have on our employees and their families as well as on the local communities where we operate. This decision was difficult but necessary in order to weather the current downturn and to position the company for long-term success."
The cutbacks will reduce Arch's thermal coal production by more than 3 million tons annually.
"Current market pressures and a challenging regulatory environment have pushed coal consumption in the United States to a 20-year low," Eaves said. "In response, we had previously streamlined capital spending, idled equipment and reduced shift work. We now are taking further steps to enhance our competitive cost position in Appalachia, while increasingly shifting our portfolio in the region toward higher-margin metallurgical coal operations. Despite the operational changes announced today, we are still able to serve customers here and abroad with the high level of quality they have come to expect from Arch."
Eaves said a strategic portfolio review is ongoing and may result in the divestiture of some of Arch's noncore assets or reserves.
"The continued aggressive steps we're taking to optimize our portfolio will allow us to better manage through the current business cycle and to prosper in the inevitable market rebound," he said.
Bill Bissett, president of the Kentucky Coal Association, said each mining jobs supports three jobs in other industries. Those support jobs are not just in the coal fields but are in cities far from the mines, he said.
Bissett said the coal markets have been affected by the recent mild winter and mild spring and also by a decline in electricity use by manufacturing. But he also blamed the federal government, saying the Obama administration is "doing its best to move this country away from coal by any means possible."
The full news release from Arch can be found here.
Sen. Joe Manchin, D-W.Va., issued this statement shortly after 6 p.m.:
"I'm disappointed to hear that so many hardworking West Virginians will be losing their jobs, and my heart goes out to them and the families they provide for. I am determined to fight for every single job in our state, and I will continue to work to bring people together around energy solutions for our future, including those which use coal, one of our cheapest and most abundant natural resources."
Congresswoman Shelley Moore Capito, R-W.Va., co-founder of the Congressional Coal Caucus, lashed out at the Obama administration and Environmental Protection Agency, saying policies they put in place are "destroying jobs." She said Thursday's announcement puts a tremendous weight on the shoulders of West Virginians and Kentucky residents who learned they will lose their jobs.
"What is it going to take for the administration and the EPA to back off?" she asked. "The administration cannot simultaneously claim they're focused on creating jobs while pushing energy policies that are shuttering plants and destroying jobs. It just doesn't pass the smell test.
"I recognize that the coal industry is subject to the same market forces as anything else; there will be ups and downs, good times and bad. But the administration is actively trying to cripple the fossil fuel industry through regulation; the EPA is now Enforcing Political Agendas and it has to stop.
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