Wednesday 29 August 2012

Losses in NZ coal industry

Solid Energy is NZ's government-owned coal company. The government has plans to sell 50 percent of shares in the company.

Downturn forces big shake-up at Solid Energy
Hundreds of jobs are either going or are threatened at Solid Energy, following a poor financial performance and the global market downturn.

29 August, 2012

The state-owned company announced on Wednesday that 63 positions will be axed at its Huntly East mine in Waikato, which employs about 230 people, and voluntary redundancies are being sought.

It will also stop work on the upgrading of the ventilation system at the mine, meaning 60 outside contracting jobs will be lost.

Sixty-five jobs are also to be cut in other areas of the company, including at Christchurch head office.

Solid Energy has suspended operations at its Spring Creek mine on the West Coast, to take effect immediately pending a review, affecting about 230 staff and 130 contractors.

The company says the underground mine in the hills behind Dunollie north of Greymouth has struggled to be profitable for some time and staff will be consulted before a final decision is made.

Last week, Solid Energy announced a nationwide review of its operations following a poor financial performance and a drop in international coal prices. The company says the changes are designed to absorb the impact of the global coal market downturn.

Coal from Spring Creek is exported through the Port of Lyttelton, while most coal from Huntly East is consumed by the Glenbrook Steel Mill. Solid Energy also runs five open cast mines, but they appear not to be affected.

Grey District mayor Tony Kokshoorn told Radio New Zealand's Checkpoint programme on Wednesday that Solid Energy should return the loyalty shown by miners, who could have chased better money overseas.

Mr Kokshoorn says closing the mine would be a kneejerk reaction and he will work with miners to try and convince the company to keep it open, although he acknowledges it will be tough going.

He says he has met with Solid Energy chief executive Don Elder, who said his main goal is to save the company.

The miners' union, the EPMU, says the proposals are not a done deal and Solid Energy must enter into meaningful consultation with the workers.

Spokesperson Garth Elliot told Checkpoint workers are very angry about the situation when told by management on Wednesday and walked out of the meeting feeling as unsure of the future as they did when they walked in.

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