The project coincides with the company’s implementation of a “seven-day work week” at the continuous miner operation along the Henderson County-Union County border, some 25 miles southwest of Evansville, Ind., company spokeswoman Janine Orf said. To prepare for the new work schedule, Patriot is hiring approximately 90 miners, many of them previously employed at Central Appalachian mines that have been idled during the past year.
The additional hirings/expansion at Highland 9 is another example of the continued rise of the high-sulfur Illinois Basin (IB) and coal industry decline in Central Appalachia, where thousands of miners have lost their jobs at dozens of mines closed or significantly cut back over the past year or two, largely because of new federal Environmental Protection Agency rules and cheaper and more plentiful natural gas.
Highland 9 produced about 2.1 million tons of coal in the first nine months of 2013 from the western Kentucky No. 9 seam, according to the federal Mine Safety and Health Administration. The mine’s total 2013 output was expected to be less than the 3.9 million tons it produced in 2012, but the new air shaft and work schedule are being counted on to bring 2014 production more in line with 2012.
Patriot filed for Chapter 11 bankruptcy reorganization in July 2012 in a St. Louis court and emerged from bankruptcy 17 months later on December 18. During its bankruptcy stay, Patriot significantly reduced its operating costs, achieving more than $200 million in estimated annual cash savings. Knighthead Capital Management LLC is contributing $250 million toward Patriot’s $545 million exit financing plan, with the remainder supplied by Patriot’s former parent, Peabody Energy Corp., and Arch Coal Inc. Peabody is based in St. Louis, while Arch is headquartered in Creve Coeur, a St. Louis suburb.
Patriot also is expected to save $130 million over the next four years under a revised labor agreement with the United Mine Workers of America. Patriot operates about 20 thermal and metallurgical mines in the IB and Central Appalachia. The company has 1.8 billion tons of coal reserves.