UK Coal to pursue £55m colliery investment

UK COAL, the Yorkshire-based coal and property business, has confirmed it is to pursue a £55m investment programme at Thoresby Colliery.

The announcement follows UK Coal's deal with EDF to supply coal to the energy firm's Cottam and West Burton power stations.

The investment programme at the Nottinghamshire colliery will allow access a further 12 million tonnes of reserves and extend the life of the colliery by around 10 years.

The contract with EDF Energy is for the delivery of four million tonnes of coal

between 2009 and 2012 from Thoresby to EDF Energy's Nottinghamshire power

stations, Cottam and West Burton.

After 2012, UK Coal will continue production at Thoresby for a further estimated six years, with the flexibility to agree new long term supply contracts, make “spot sales” or a combination of the two. Coal will also be supplied from UK Coal's Welbeck Colliery.

Jon Lloyd, UK Coal's chief executive, said:

“This is excellent news for all parties. For EDF Energy it secures a continued

guaranteed source of quality coal produced on the doorstep of its power

stations.

“For UK Coal, it is a further significant advance towards us achieving market price for our coal production, it enables us to invest in profitably opening-up major new reserves at Thoresby, and it thereby extends the life of the mine and the jobs of its employees for 10 years longer than had until now been planned.”

Today, UK Coal operates four mines producing some 40 million tonnes of coal a year and employing 2,900 staff.

Over recent years it has become one of the country's biggest land owners, which it plans to use for commercial development and diversification in renewable energies such as wind power.