CNX Coal cuts 303 workers at Bailey mine as it awaits permit decision

Houston (Platts)--12 Sep 2017 1253 am EDT/453 GMT

CNX Coal has reduced the workforce at its Bailey Mine by 303 employees while it continues to wait for a Pennsylvania Department of Environmental Protection decision on a longwall panel permit at the mine.

Neither CNX nor the DEP Monday could give a time frame on when a decision on the permit would be made.

The miner suspended production at the longwall September 1 after failing to receive word on the permit. CNX said it's the first time in the 35-year history of the mine the company has failed to timely receive a needed mining permit.

CNX said idling the panel has resulted in an output loss of about 25,000 st/d. Bailey, the top-producing Northern Appalachian longwall mine, produced 12 million st last year and 6.2 million st through the first half of 2017.

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NAPP sources Monday said they've seen no effects of production cuts on 13,000 Btu/lb coal prices, with values largely lingering in the mid-$40s/st range. Both traders and producers noted poor domestic thermal markets have put pressure on prices despite continued export interest from Europe and a lasting crossover metallurgical seaborne market.

CNX said it could make up some production losses in the fourth quarter but warned if permit is not issued in the near future, additional layoffs are likely and the "impact on the company could be material."

At question is the 4L panel permit at Bailey, which allows mining under the Polen Run creek at Ryerson Station State Park. The Pennsylvania Environmental Hearing Board in late January blocked a Bailey longwall 100 feet from mining under the nearby Kent Run stream in the state park.

DEP said Monday it is reviewing the 4L permit in light of an environmental board ruling in August that invalidated some methods of stream remediation included in prior longwall permits. CNX parent Consol Energy amended the original permit for 4L, which the DEP approved in 2014, and said the modification "meets the necessary criteria and complies with the spirit of the recent EHB decision."

The DEP said it received the amended permit less than two weeks ago and is working to complete a "thorough review" of the permit, including the new methods of stream remediation, "to ensure that they meet the environmental and public health standards of Pennsylvania."

--Jim Levesque,
--Edited by Valarie Jackson,

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