UK Coal has announced a restructuring plan for its mining operations, a move which will save 2,000 jobs, as it entered into administration following a major fire that closed its Daw Mill deep mine in March 2013.
Production from Daw Mill represented nearly one-third of the company’s revenue and the closure of the mine had put the ongoing viability of UK Coal Operations’ remaining two deep mines and six surface mines in risk.
The administrators have separated the viable operations of the company and entered into agreements with major creditors, including the Industry Wide Pension Funds. The move will result in the transfer of pension schemes to the Pension Protection Fund in due course.
The company’s viable mining operations have been restructured and the assets will now be held in individual companies owned by a new business, UK Coal Production.
In response to the announcement of UK Coal restructure, Energy Minister Michael Fallon said that the priority now must be to continue to support former Daw Mill workers into employment as early as possible.
"The Government will ensure workers receive their full statutory redundancy payments through the Redundancy Payments Service. In addition, the Job Centre Plus-led Rapid Response Service will provide help to the community," Fallon said.
The new company, UK Coal Production, will be owned by UK Coal Mining Holdings – a new parent company.