Continuing weakness in world prices for high grade coking coal appears likely to trigger a new round of job losses at Solid Energy's main opencast metallurgical coal mine, Stockton, New Zealand.
The report is further bad news for the Westport community following Bathurst Resources' decision to place its new mining plans on hold indefinitely earlier in the year.
A Solid Energy spokesman disputed a media figure of 300-plus job losses from the 514-strong workforce at Stockton but confirmed the company would be speaking to staff at the mine tomorrow morning and briefing media in the early afternoon.
If confirmed, the restructuring will be the first major act by the company's newly appointed chief executive, a former senior manager at Australian miner Glencore, Dan Clifford, who took the reins at the troubled state-owned collier last month.
The expected decision comes amid continuing weakness in the value of high-grade coking coal, used in steel-making as surging production from mines in Queensland depresses prices globally and Chinese steel production continues to be weak after years of strong demand.
According to minerals website Mining.com, contracts in Q2 2014 for metallurgical coal have been written at around US$ 120/t – 14% down on Q1 contract prices and the lowest since 2008.
The Stockton mine is New Zealand’s largest opencast coal mining operation.
A 28% fall in revenue, due to continued weak international coal prices and reduced off take from New Zealand customers, contributed to a US$ 40.9 million loss (compared to a loss in 2012 of US$ 318.2 million) for coal producer, Solid Energy, for the half year ended 31st December 2013. The result included one-off restructuring costs of US$ 12.4 million.
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/coal/05062014/stockton_mine_workers_face_redundancy_940/