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Issue link: https://coal.epubxp.com/i/718122
8 www.coalage.com August 2016 news continued in prices for both near-term and out-year seaborne thermal coal," the company said, adding that Chinese imports for thermal coal have risen and there is also growing demand from other areas of Asia, including Vietnam, South Korea, Japan and Taiwan. Looking ahead at the remainder of the year, CPE officials said they foresee a balancing out of supply and demand. Colorado Production Drops, Injuries Rise The Colorado Division of Reclamation, Mining and Safety has re- leased its newest coal production report, revealing that the state's production between January and June dropped 42% while miner injuries also went up by 20%. The agency said the Colorado mines, versus the same period in 2015, have sliced output from anywhere between 14% and 96%; the latter is from the closure of the Bowie No. 2 operation, which dropped from about 856,000 tons last year to 33,395 tons this year. Colorado measures the performance of nine total mines: Bowie, Colowyo, Deserado, Twentymile, King II, New Elk, New Horizon North, Trapper Strip and West Elk. Bowie and New Elk are both now idle. From the nine combined, production for January 1 through June was a little more than 5.73 million tons. Twentymile was the leader of the group with 1.72 million tons. The mine group also reported a total of 12 on-the-job inju- ries (none of the reported incidents were fatal). Deserado had the most with seven, followed by Twentymile and Trapper with two each. Year-over-year, only one of the Colorado's mines increased employment; New Horizon North added one for a new total staff of 21. Cuts elsewhere, which ranged from 1% to 45%, were topped by West Elk, which fell to 192 employees from 350 last June. Indiana's First Underground Mining Simulation Center to Be Built The Vincennes University (VU) Board of Trustees approved a $2 million contract to build Indiana's only underground mining simulation center. It will be located at VU's Gibson County Cen- ter for Advanced Manufacturing and Logistics. Krempp Con- struction in Jasper was awarded the contract to build the almost 40,000-square-foot mock mine. It will have two main entrances with two exits on each side. VU received funding for the project in the state's biennium budget. "In addition to coal, this new center will be useful for other types of mining as well as for fire and rescue training and VU's homeland security and law enforcement programs," said VU Pres- ident Chuck Johnson. Modeled after a simulated underground mine training facility at West Virginia University, VU expects its new facility to attract miners from throughout Indiana as well as Illinois and Kentucky. VU is Indiana's designated recipient of federal grant funding from the U.S. Mine Safety and Health Administration (MSHA) to provide assistance in the training and retraining of Indiana's min- ers. The VU program was initiated in October 2005 for miners in all segments of the mining industry, including coal, sand and gravel, cement, crushed stone, dimension limestone, gypsum, shale, and clay. VU's mining program provides the required training for new underground miners and new surface miners, in addition to MSHA-required annual refresher training for all miners. "VU provides MSHA training to thousands of miners annually. This new facility will add to our capacity to do that training," John- son said. increasing production further in the year ahead, thereby delivering strong increasing production further in the year ahead, thereby delivering strong sales and cashfl ow to pay down debt facilities and to fund growth pros- sales and cashfl ow to pay down debt facilities and to fund growth pros- pects," CEO Tony Weber said. Universal noted that, with the country's dry season half over, the climate Universal noted that, with the country's dry season half over, the climate Universal noted that, with the country's dry season half over, the climate is expected to support continued strong production for the months ahead. is expected to support continued strong production for the months ahead. Elsewhere in its portfolio, the miner said it is ready to begin commis- Elsewhere in its portfolio, the miner said it is ready to begin commis- sioning underground operations at the New Clydesdale colliery; it is expect- sioning underground operations at the New Clydesdale colliery; it is expect- ing fi rst coal by the end of the current quarter and is projecting 2 million mt ing fi rst coal by the end of the current quarter and is projecting 2 million mt of production annually. Czech Government Approves Loan to Help Miner OKD On July 27, the Czech government approved a 700 million crown ($29 mil- lion) loan to help keep afl oat OKD, an insolvent metallurgical coal operator owned by New World Resources, according to Business Radio Prague. A major employer in the Czech Republic's industrial northeast, the company has been employer in the Czech Republic's industrial northeast, the company has been scrambling for cash to pay miners' wages in recent months as it goes through insolvency proceedings with the aim of reorganizing as government ministers debate how to help the fi rm (see Eastern European Coal Report, p. 44). debate how to help the fi rm (see Eastern European Coal Report, p. 44). The loan gives OKD, which employs around 12,500 and that mined 8 million metric tons in 2015, enough cash to continue operations until the end of the year. "Keeping OKD in operation is an important condition for social of the year. "Keeping OKD in operation is an important condition for social stability in the region," Prime Minister Bohuslav Sobotka said on Twitter. stability in the region," Prime Minister Bohuslav Sobotka said on Twitter. OKD has debt around 17 billion crowns ($708 million) and assets worth OKD has debt around 17 billion crowns ($708 million) and assets worth less than 7 billion crowns ($292 million), according to the insolvency fi ling. Poland Adjusts Mining Rescue Plan The Polish government has tweaked its rescue plan for ailing coal miner KHW, according to the Warsaw Voice, and will now seek to transfer KHW assets, funds put forward by coal exporter Weglokoks, utility Enea and an- assets, funds put forward by coal exporter Weglokoks, utility Enea and an- assets, funds put forward by coal exporter Weglokoks, utility Enea and an- other, yet unknown, treasury fi rm into a new holding entity, Deputy Energy other, yet unknown, treasury fi rm into a new holding entity, Deputy Energy Minister Grzegorz Tobiszowski told reporters. Minister Grzegorz Tobiszowski told reporters. Investors will pony up some PLN 700 million ($182 million) for the project, including PLN 150 million ($39 million) from Weglokoks and some PLN 200 million ($52 million) from another treasury fi rm, Tobiszowski said. That would place Enea's contribution at some PLN 350 million ($91 million) The new entity, Polski Holding Weglowy (PHW), would also encompass The new entity, Polski Holding Weglowy (PHW), would also encompass Weglokoks' mines, to be transferred by mid-2017, increasing Weglokoks' stake in the holding, the minister said. After PHW is formed, the govern- ment will seek to renegotiate the miner's deals with banks inherited from KHW. "We have to start the process of talks with fi nancial institutions in KHW. "We have to start the process of talks with fi nancial institutions in order to postpone debt repayment, particularly bond redemption, to 2020, order to postpone debt repayment, particularly bond redemption, to 2020, perhaps 2021," Tobiszowski said. China Cuts Coal Capacity China Cuts Coal Capacity Local governments and state-owned fi rms in China have completed about one-third of the 2016 coal overcapacity reduction target in the fi rst six months, with some regions still yet to take concrete action, Xinhua report- months, with some regions still yet to take concrete action, Xinhua report- ed. The industry has cut 72 million metric tons (mt) in coal production ed. The industry has cut 72 million metric tons (mt) in coal production capacity, or 29% of the 250-million-mt goal for the year. Central province Hunan and eastern province Jiangsu completed 83% and 78% of their cuts, respectively, in the fi rst six months, while Beijing, the northern province of Shanxi and northwestern Xinjiang were halfway the northern province of Shanxi and northwestern Xinjiang were halfway the northern province of Shanxi and northwestern Xinjiang were halfway through. Nine other provinces have yet to make any dent in their coal pro- duction overcapacity. duction overcapacity. Coal production fell 9.7% during the fi rst half of the year to 1.63 bil- lion mt. Inventories were down 8.6% in the same period. Meanwhile, coal prices recovered, with coal shipped to Qinhuangdao Port up 50 yuan/mt prices recovered, with coal shipped to Qinhuangdao Port up 50 yuan/mt ($7.49/mt) to 420 yuan/mt ($62.87/mt) on July 20. Continued from p. 6...