James River Coal Co has idled two underground and two surface mines at its Buckeye complex in Kentucky. This latest round of closures brings the number of James River Coal mines shut to seven since September.
Announcement of the closures was made within then James River 2013 Q3 operating report, which disclosed the company had temporarily laid-off approximately 200 employees and contractors as coal prices continue to slump.
James River has seen net loss of $25.5 million or $0.73 per diluted share for the third quarter of 2013 and net loss of $15.0 million or $0.43 per diluted share for the nine months ended September 30, 2013.
The U.S. coal industry has been hard hit by weak prices and tougher environmental regulations. Demand for thermal coal has dropped as power companies opt for cheaper natural gas, which also boasts a lower emissions profile. Metallurgical coal has also suffered, with pricing effected by low steel demand and excess supplies.
Peter T. Socha, Chairman and Chief Executive Officer commented: "The mines are doing great. They have continued to exceed our expectations for both cost control and capital control. They have done an incredible job of adjusting to the soft market conditions and the high levels of uncertainty and concern that surround the coal industry of Central Appalachia. We have made another set of painful, but necessary, production adjustments this week. This involved idling four additional mines in eastern Kentucky. We are hopeful that these idlings can be reversed in the first half of 2014. The coal markets have stabilized during the past several weeks. Prices are still very low, but they are finally moving in a better direction. Finally, we are making progress, but have not finished our project to deleverage our balance sheet and improve our liquidity."
The company said it was hopeful that the four mines idled at its Buckeye complex could be reopened in the first half of 2014.