Daw Mill under threat of closure
UK Coal is considering plans to shut the biggest coal mine in the country as part of a wider restructuring of the group.
The company said today that the Daw Mill mine near Coventry, thought to employ around 800 people, would only be retained beyond 2013 if it could find a “lower risk operating model”.
According to UK Coal, the Daw Mill mine is currently 175,000 tonnes behind budget with managing director for mining Gareth Williams taking personal charge of the operation to find ways of improving production.
Closure in early 2014 would coincide with the completion of mining of existing coal panels and the company has suspended plans for further mining beyond 2013.
UK Coal also wants to reorganise the company so that it can invest in each deep mine but isolate the group as a whole from risk and has begun discussions with power generators, pensions trustees and the Government.
In a statement, the company warned shareholders that the plan could mean a dilution of their holdings.
“The board believes that this restructuring will provide a stable platform in the medium term for the group’s mining and property businesses and will achieve the best value in the group for its stakeholders,” it said.
It is in discussions with Lloyds about funding for the restructured group and is confident that renewed banking facilities will be agreed to the end of next year.
