Coal news and updates

US miner Patriot Coal temporarily idles West Virginia mines on inventory, low demand

US miner Patriot Coal said Monday it has temporarily idled coal production at the Samples surface thermal coal mine and Winchester underground metallurgical coal mine at its Paint Creek Complex near Cabin Creek in southern West Virginia.

Production stopped Sunday, the company said in a statement, and will resume in three to four weeks after the complex's coal stockpiles are more in line with demand, an official said. Processing and shipping of coal to customers from on-site stockpiles will continue throughout the idle period. Officials said in the statement that the mines were idled in response to high coal inventory levels driven by a combination of a CSX rail service disruption in February and continued weakness in demand for coal.

Janine Orf, vice president of investor relations at Patriot, said the February 16 derailment of a CSX oil train in Mount Carbon, West Virginia, and ensuing fire shut down rail service for 10 days on the main East Coast corridor connecting the mines to the export port at Newport News, Virginia.

CSX did not return a call seeking comment Monday.

Appalachian thermal coal markets have been particularly hard hit over recent months by the combined impacts of coal-fired plant closures driven by US Environmental Protection Agency emission regulations, low-cost natural gas and diminished export opportunities, Patriot said in the statement.

Combined, the two mines in the Paint Creek Complex produced 2.4 million st in 2013, Orf said.

US Mine Safety and Health Administration data showed that the Samples mine produced 2.6 million st in 2014, up about 1 million st from 2013. The Winchester mine produced 928,812 st in 2014, down about 33,000 st from 2013.

About 400 employees work at Paint Creek, and about 35 positions were permanently eliminated at the Samples mine on Sunday, Patriot said.

Paint Creek is one of Patriot's eight coal mining complexes in West Virginia. In November 2013, Patriot idled the Logan County complex, and production there is still stopped, Orf said. The Guyan mine in the Logan County complex produced 1.8 million st of thermal coal in 2013.

source: http://www.platts.com