Hargreaves withdraws UK Coal loan offer
THE immediate future of 700 Yorkshire jobs is clouded in uncertainty after one of the backers of a managed closure plan for two of the last three deep mines in Britain pulled out of the deal.
Mining group Hargreaves Services announced it had withdrawn its loan offer to assist with the wind down of Kellingley in Yorkshire and Thoresby in Nottinghamshire, which together employ 1,300 people.
Hargreaves had pledged a £5m loan, while the government said in April it would provide UK Coal with a £10m loan to help fund the closure.
That, alongside £5m from landlord Harworth Estates, would have kept UK Coal in business until autumn 2015.
It is understood that the Government cash is still on offer.
Hargreaves, which runs Monckton coking plant near Barnsley in South Yorkshire, said: “It is with regret that Hargreaves announces that, despite the efforts of the stakeholders, it has not been possible to secure a plan that it is able to support. In these circumstances the company is no longer able to provide loan finance and has now withdrawn from the process.”
Gordon Banham, CEO of Hargreaves, said: “It is with great regret that this announcement is made today; however we would like to recognise the help and efforts of the Government, unions and other stakeholders, including Harworth Estates, in trying to develop a plan that we could support.”
Hargreaves made a £20m bid for UK Coal last year when it was in administration following a fire at its Daw Mill colliery near Nuneaton before the Pension Protection Fund stepped in.
UK Coal provides 8% of the total coal consumed in the UK.
It said a strong pound meant it had lost out to cheaper imported coal, especially from the US, where the boom in shale gas has forced coal miners to find new markets in Europe.
The closure of Kellingley and Thoresby would leave Hatfield colliery in South Yorkshire as Britain’s last remaining deep pit mine.
UK Coal said it was pursuing other options for its managed closure plan.
