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Two UK coal mines threatened with closure

08 November 2012

Two UK collieries, Maltby in South Yorkshire and Daw Mill in Warwickshire, are being prepared for closure because of geological problems compounded by an ever-dwindling market for UK-sourced coal.

Hargreaves Services said on November 8 it will stop all mining activities at its Maltby coal mine due to dangerous conditions, putting 550 jobs at risk. Maltby is a deep mine operating about three-quarters of a mile underground. 

The group said the T125 panel was "not viable on health and safety, geological, and financial grounds. Consequently the board is proposing that T125 will not be mined and that the mine will be mothballed.”

The company, which also operates the Hatfield Colliery and has a joint venture running the Tower Colliery in South Wales, first revealed that it had encountered “unusual geological conditions” in May. Water and toxic gases were leaking from a new coal face, putting miners’ safety at risk.

Hargreaves said it would continue to consult with Maltby employees and trade union representatives and remained “committed to exploring alternative employment opportunities for staff.”

Unions have until November 30 to table any proposals that could see the mine continuing as part of the formal consultation process, however, analysts believe it is probable that the mine will be closed and its equipment sold.

The Maltby mine supplies the giant Drax power station in North Yorkshire, the largest coal-fired power plant in Europe. About 60pc of the mine’s output was used by Drax. Hargreaves is sourcing coal from alternative suppliers and no disruption to supply at the power station is expected.

Hargreaves has sourced alternative supplies for its Monckton coke works near Barnsley. Monckton produces about 200,000 tonnes of coke per year, used in glass, detergents and steel manufacturing, as well for heating homes.

The announcement comes just two days after UK Coal took another step towards the expected mothballing of its Daw Mill mine in Warwickshire, according to The Independent.

At an emergency meeting on November 6, UK Coal's shareholders voted through a range of measures in an attempt to rescue the struggling group, which is the country's biggest coal miner. These include splitting off Daw Mill into a separate legal entity, which means it can no longer be subsidised by the group's other mines or its profitable property arm.

Once the country's most productive pit, Daw Mill, which has been plagued by geological problems, will close by 2014 unless production rises and costs come down, putting 800 jobs at risk.

Last year, the industry, which was reprivatised in 1994, produced 17.8 million tonnes of coal at 52 mines and employed 6,419 people – a monumental decline from the 470,000 workers in the industry in 1947.

The decline looks set to continue, as the UK seeks to comply with EU legislation, introduced in 2001 and designed to reduce carbon emissions. This states that coal-fired stations built before 1987 – a particularly dirty source of energy – must either be modified with costly, modern emissions control equipment, or operate only for a total of 20,000 hours between 2008 and 2015, when they must come out of service completely. As a result, a series of coal-fired power plants will close early, significantly reducing customers for UK-mined coal.

Also, as power producers seek to reduce their carbon emissions, they are moving away from fossil fuels to renewable energy in a development that will further hit demand for coal.

A fortnight ago, Europe's largest coal-fired power plant, Drax, announced a £700m plan to convert half its boilers in North Yorkshire to biomass materials such as wood pellets. This week, it emerged that Eggborough Power Station, which generates about 4% of the country's electricity from its site in North Yorkshire, will also convert from coal to biomass.

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