Cline Mining, a Canadian company, bought the New Elk mine in 2008, more than a decade after mining operations in the area were shut down. As reported earlier by Coal Age, initial plans by Cline were to hire as many as 500 to work in the newly opened mine. But market conditions intervened.
Dennis Mraz, vice president and COO at Cline, said the mine is cutting its operations because of the low coal prices, the Chieftan reported. “Yes, we had to lay off some workers. We really need to protect ourselves. We are looking and hoping to bring these workers back when the market gets better in a few months.” New Elk staffing went from 305 miners to 235 after the recent layoffs.
Despite the layoffs, during the previous quarter, New Elk Coal Co., a wholly-owned subsidiary of Cline, signed a coal mining lease agreement with the Colorado Department of Wildlife which significantly extended NECC original DOW coal mining property at its New Elk coal mine in Las Animas County, southern Colorado. The initial New Elk DOW coal mine lease covered an area of 15,553 acres, and the extension area will add a further 14,387 contiguous acres to the initial DOW Lease, resulting in a new total coal lease property area of 29,940 acres. The initial DOW lease area contains 330.3 million tons of coal resources out of the total of 388.5 million tons of coal resources on all of the New Elk property. An updated report will be made available May 24 detailing the extent of new coal measures.