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Mont. Coal Mine's Future Uncertain As Layoffs Loom

The Decker mine employs about 162 miners, mill workers and office staff, according to U.S. Labor Department statistics. Most live in Sheridan, Wyo.

The town's mayor, Dave Kinskey, said last week's layoff announcement compounded the economic woes from a downturn in the area's natural gas industry, as low prices cause drilling to slow.

Job service agencies in Montana and Wyoming already are gearing up to help layoff victims find new work, according to officials from the states. But Kinskey said the market pressures confronting the coal industry â¿¿ including competition from cheap natural gas â¿¿ could make the task difficult.

"There had been talk about expansion of the mines if we were able to get west coast ports open" to export coal to Asia, Kinskey said. "At the same time, there's been slow down in all of the coal mining companies due to slackening demand. It's hard to know what the future holds."

Representatives of Ambre and Cloud Peak declined to answer questions about Decker's future. The only explanation offered for the layoffs was that they were part of the mine's "ongoing expense management activities."

The mine is operated by Ambre subsidiary KCP. Oversight comes from a management board that has equal representation from Ambre and Cloud Peak.

Cloud Peak's attorneys said in the company's July lawsuit against Ambre that the mine operated at a $21.1 million loss in 2011. It has production costs as much as four and five times greater than those of some competitors, the attorneys wrote.

Given those factors and the expiring contract, the management board's plan for the Decker calls for coal sales to decline over time "with no further significant coal sales beyond 2013 sales to Detroit Edison."

However, as recently as June the Decker mine's managers filed a map with the Montana Department of Environmental Quality showing areas to be mined through 2022. Executives an Ambre subsidiary reportedly said over the summer that they wanted to ramp up production at Decker and expand its workforce by up to 50 percent.

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