W.Va., Va. weighing impact of Alpha mine layoffs
MORGANTOWN, W.Va. -- When 400 Appalachian coal miners learned their lives were turning upside-down with the sudden shutdown of mines in three states, Trent Lucas got relatively good news: He'll still have a job.
The 34-year-old Alpha Natural Resources miner from Wise, Va., will transfer from the now-idled Guest Mountain No. 9 to the Osaka mine, but it's still only a 45-minute commute. His best friend, a mine supervisor, wasn't so lucky. He's among the 150 people for whom Alpha says it has no other positions.
"I went to the bank and the lady in the drive-thru window asked me if Trent still had a job," Lucas' wife Shana said Wednesday. "I told her, 'Thank God he does.' And she said, 'I'm very happy for you guys. ...Sadly, my husband lost his job.'
"It broke my heart," Shana Lucas said. "You could see the hurt and worry in her eyes. And I felt somewhat guilty."
On Tuesday, Virginia-based Alpha announced it was immediately closing eight mines -- four in West Virginia, three in Virginia and one in Pennsylvania -- and eliminating 1,200 jobs companywide by early 2013.
Alpha said 270 of the 400 workers affected by the first round of shutdowns will be reassigned or will replace outside contractors.
But in West Virginia, 80 miners are out of luck as the company cuts production by 16 million tons and shifts its focus from supplying U.S. power plants to supplying power plants and steel mills overseas. In Virginia, 70 workers now must scramble for a new job. In Pennsylvania, three are unemployed.
Communities are still trying to gauge the impact.
Fayette County, W.Va., gets about $750,000 a year in coal severance taxes, Commissioner Matt Wender said. How much the county will lose from the shutdown of the Alloy deep and surface mines is unclear.
Though the job losses aren't as extensive as he initially feared, "obviously, the total effect is negative," he said.
There's also a trickle-down effect as money that had been spent on local businesses vanishes.
"These are jobs that are lost -- and people who were earning a pretty darn good wage," Wender said.
Alpha said Wednesday it took 2 million tons out of production with the initial idlings. While spokesman Ted Pile would not say where the next layoffs will occur, he said "it's obvious more is to come."
Alpha said about 40 percent of its production cuts will come from high-cost Eastern mines, while about half will occur in the Powder River Basin in Wyoming, the largest coal-producing region in the U.S.
Another 800 positions will have to be eliminated in the coming months, Pile said, and there will likely be fewer reassignment opportunities or open positions as time goes on.
"Having to send home good, hard-working men and women is only the option of last resort," he said. "But we are unfortunately dealing with an entirely new reality."
Pile said each decision must make sense for the long-term health of the company and must honor supply contracts already in place.
"We are looking at all of our operations. What are the costs? What are the savings? What are the risks or opportunities in light of the changes in the market?" he said.
The answers to those questions will determine which ones are most cost-efficient, provide better-quality coal at a realistic price and can be more flexible with customer demands.
Chris Hamilton, vice president of the West Virginia Coal Association, said more layoffs in Appalachia are likely through the end of the year and into the first quarter as other companies struggle with the loss of traditional customers such as power plants.
As federal air pollution regulations tighten, utilities are increasingly shifting to natural gas and closing old, inefficient plants.
It's likely that other companies will follow Alpha's lead and look to the export market in the future, Hamilton said. West Virginia has historically accounted for about half of U.S. coal exports.
Shana Lucas did a lot of praying this week as she waited to see who would survive Alpha's cuts.
Miners can make $25 to $30 an hour, she said -- nearly three times what she could make with a college degree. Without coal, the options are limited. The few available jobs tend to be the service sector, she said. Had her husband lost his position, he'd likely have ended up back at the tire shop where he once worked.
"Going into the coal mines here, that is the way little boys' dreams come true," she said. "I remember growing up, the rich people were the doctors, the lawyers and the coal miners.
"They have worked so, so hard, and they are losing everything they've worked for."
Associated Press writer Dena Potter contributed from Richmond, Va.