OPENCAST mining operator Hargreaves Services is to spend more than £3 million accelerating the closure of most of its sites in Scotland, with the loss of around 350 jobs.
Only one – House of Water in Ayrshire – will remain. Those to be closed include Duncanziemere and Netherton, in East Ayrshire; Broken Cross, in South Lanarkshire; Glenmuckloch, in Dumfries and Galloway; and St Ninians, in Fife.
Extraction of coal from the Muir Dean site near Crossgates, Fife, has already ceased because of an “ongoing lack of demand”. Coal from here had been used at the Longannet Power station, but that shut down last month.
Malcolm Spaven, chairman of the Scottish Opencast Communities Alliance (SOCA), said the announcement from Hargreaves was not surprising, but the case was now even stronger for Scottish and UK government action to invest in the restoration of the sites.
He told The National: “We need the Scottish and UK Governments, local government and all the agencies involved to work together to pool all available money before this industry ceases to exist altogether.”
He said politicians had wasted more than a year pursuing a tax break scheme for the industry that would never work because “it assumed power stations would still be buying coal”.
“We could use carbon tax revenues estimated at around £200 million for a restoration programme at all the abandoned and disused opencast sites, to return them to what they were. We urgently need to know the cost of the remaining restoration required at each site so that the scale of the task facing abandoned communities is understood.”
In a statement, Hargreaves said it had worked hard to position itself to face the growing challenges in the coal and steel markets.
“This programme has included undertaking a far-reaching restructuring exercise aimed at simplifying the group through disposals and business closures to reduce debt levels and to seek to mitigate the risks and volatility faced by the group in its coal, coke and steel related activities,” it said.
“Over the last year, the challenges facing the coal sector in the UK have increased due to continuing coal price weakness and low levels of coal demand arising from weak gas prices and an accelerated programme of UK coal generation plant closures.
“Given these continuing pressures the board has elected to further accelerate its withdrawal from the thermal coal sector.”
In its interim first-half results to the end of November, Hargreaves said its surface mining operations in Scotland, England and Wales recorded a £3m operating loss, compared with £8m profit in the previous period. Its chief executive Gordon Banham, said yesterday’s announcement marked a turning point for the group.
“After 18 months of market turmoil, we are finally completing a challenging phase of restructuring to move away from our traditional areas of focus and reposition the group,” he said. “The bulk of that restructuring work is complete and we can now look forward and actively pursue the value creation opportunities ahead of us.” Spaven added: “There seems to be a hint in today’s announcement that they will now withdraw a number of planning applications that they have in the system for new sites. This is long overdue since communities around them have been blighted for years, not knowing whether they’ll go ahead.
“There remain two other operators in Scotland – Kier Mining at Greenburn, in Ayrshire and Banks Mining at Rusha, in West Lothian.
“Kier have stopped coaling and the future of the site is under some question since they failed to find a buyer for it last year.
“Rusha was supplying Longannet plus some other markets via Hunterston, so its future must also now be in doubt.”
A Scottish Government spokesman said: “We are working with Hargreaves and Scottish Mines Restoration Trust to ensure the best possible restoration of sites across Scotland and have set up a Restoration Working Group to co-ordinate this work.”
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