James River Coal Idling Mines, Reducing Production
RICHMOND, Va. (AP) â¿¿ James River Coal Co. is idling mines and reducing coal production by 3 million tons in response to weak demand.
The Richmond-based company mines thermal coal used for power generation and metallurgical coal that's used to produce steel. It has operations in Kentucky, West Virginia and Indiana.
James River said Thursday it has idled five underground mines, two preparation plants and one load-out facility. It also has reduced production at three surface mines. The company says the moves impact about 400 employees and contractors.
"We are adjusting to the changing market conditions throughout our organization. ... Many of these decisions have been difficult but necessary," CEO Peter Socha said in a news release. "Our mine operations are in better shape today than at any time in the past 10 years."The company said that its fourth-quarter net loss more than doubled to $76.9 million and revenue fell more than 35 percent to $232.2 million. Coal producers are being hit by a double whammy of weak demand. Utilities need less coal to produce electricity because of mild weather and lower power generation, while construction overseas has slowed the appetite for coal to make steel. "The year 2012 will be remembered as one of the most difficult years in the history of the U.S. coal industry," Socha said. While markets are "showing some marginal improvement" in 2013, Socha said that conditions remain weak. "We are cautiously optimistic that our changed operating model and improving markets for several of our products will lead to a brighter future in 2013," he said.
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