26th Jan 2005 11:50
UK Coal PLC26 January 2005 26 January 2005 FLOOD ENDS PRODUCTION AT ELLINGTON COLLIERY UK COAL today announced it has been forced to cease production at EllingtonColliery in the North East of England for safety reasons following thepenetration of water on the colliery coal face and unacceptable risks associatedwith extracting limited nearby reserves. Extensive round-the-clock pumping overthe past 13 days to lower the water levels on the face, and the supply roadsleading to it, have been unsuccessful. Ellington has produced around 12,000 tonnes of coal a week, most of which wassupplied to the nearby Alcan power station. Supplies of coal to Alcan arecurrently being maintained from stocks of around 150,000 tonnes at the colliery,and surface mining operations elsewhere in the region. UK COAL Chief Executive Gerry Spindler said : "The loss of any mine in thesecircumstances is a bitter blow, particularly for our employees and the localcommunities in which they live. However, the safety of our employees isparamount. Whilst we have contained the flow, the face is flooded and miningadjacent reserves carries unacceptable levels of risk. We are left with norealistic option but to close the mine." Added Mr. Spindler: "We could not have asked for, or received, more commitmentthan that given by the Ellington workforce, and it is a great sadness that theirattempts to maintain viable deep mine operations for some years to come havebeen so abruptly terminated." Ellington Colliery made an estimated loss in 2004 of £11.0m. The cessation ofproduction will result in the loss of 340 jobs and in a non-cash write-down of£4 million in respect of its operations in the 2004 financial year; theadditional costs of closure, including redundancies, amount to £6 million andwill be recognised in the 2005 accounts in accordance with UK generally acceptedaccounting principles. Prior to shaft filling, capping and surface remedialworks estimated at £3 million, the closure will be cash neutral in 2005. MEDIA CONTACTS: Financial: Ken Cronin Tel: 0207 554 1400(Gavin Anderson & Company) Mob: 07887 591 499 UK COALOperational: Stuart Oliver Tel: 01525 381759 Mob: 07774 231178 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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