CONSOL closes Mine 84 to reallocate funds for other coal, shale

Posted June 29, 2011

 

CONSOL Energy Inc. is permanently closing Mine 84 near Washington to “reallocate resources into more profitable coal operations and Marcellus Shale drilling activities,” the company said today in a public filing.

The decision was made last week, according to the filing, and will cost the company $116 million in pre-tax dollars — $11 million non-cash and $5 million in future expenditures. But from now on, it’ll be saving $18 million annually by closing the mine.

CONSOL has been mining there since 1998.

For much of the past decade, the mine has produced between 3.5 million and 4.2 million tons of bituminous coal a year, except in 2001, when it fell to 1.7 million. In 2008, the number again slid to 1.8 million and to just over 500,000 in 2009, when production stopped.

The move has been years in the making. In 2007, CONSOL said the mine wasn’t meeting its targets for a return on investment.

And in 2009, when it was idled and more than 200 workers displaced, Jimmy Brock, CONSOL’s vice president of operations said, in a statement: “Mine 84 has been in operation for many decades, and it is unfortunate that the time has come when it was no longer able to compete in today’s market.”