ST. LOUIS — A coal producer owned by a longtime critic of President Barack Obama’s energy policies will lay off nearly 160 workers at Illinois and Utah mines, blaming the freshly re-elected president for a “war on coal.”
Ohio-based Murray Energy Corp. said in a statement that it would give pink slips to 102 workers at its West Ridge Mine in Utah and 54 at its underground mine in the southern Illinois town of Galatia. Both mines are run by Murray Energy subsidiaries.
The announcement’s timing — just days after Obama’s victory over Republican Mitt Romney — was anything but coincidental. Robert Murray, the company’s chairman, CEO and founder, had backed Romney, who proposed rolling back some restrictions on power-plant emissions and positioned himself as a supporter of the coal industry.
“The American people have made their choice,” Murray, a day after the election, told about 50 employees during a prayer, a text of which was provided to the AP by the company. Lamenting the country’s direction and insisting “the takers outvoted the producers,” Murray asked for God’s forgiveness “for the decisions that we are now forced to make to preserve the very existence of any of the enterprises that you have helped us build.”
Murray’s statement Friday, which insisted that the coal industry “is being destroyed,” said U.S. coal production this year could plunge by hundreds of millions of tons, and that the Obama administration’s energy policies will lead to the closure of scores of U.S. coal-fired power plants by 2014.
The Environmental Protection Agency has proposed tighter limits on mercury, sulfur dioxide and other pollutants that would make it more expensive for utilities to burn coal, a major source of those emissions. The EPA has also proposed limiting the amount of carbon dioxide that new power plants can emit.
Neither would specifically bar coal-fired power plants, but experts say it would be nearly impossible to build an affordable new coal plant that could meet the limits. The proposals, some which had begun under George W. Bush’s administration, wouldn’t affect coal plants now in use or being built.
Obama, who during his 2008 campaign said builders of new coal-powered plants will go bankrupt from emissions standards he would enact, now espouses an “all of the above” energy strategy that includes coal.
“The president has made clear that coal has an important role to play in our energy economy today and it will in the future, which is why this administration has worked to make sure that moving forward we can continue to rely on a broad range of domestic energy sources from oil and gas, to wind and solar, to nuclear, as well as clean coal,” Clark Stevens, a White House spokesman, said recently.
What’s happening in the coal industry is more than a seasonal slump or a response to new regulations; even coal executives admit it’s a fundamental shift. Many utilities have switched from coal to cheaper natural gas for electricity generation, pushing up coal stockpiles at power plants and forcing mining companies to sharply cut production.
When St. Louis-based Patriot Coal filed for bankruptcy in July, it didn’t mention a war on coal but cited “a major correction” in the industry and “new realities in the market,” including fierce, sustainable competition of natural gas. But St. Louis-based Arch Coal Inc. blamed market pressures and a challenging regulatory backdrop in its June announcement it would lay off about 750 Appalachian coal workers.
A recent rebound in natural gas prices has buoyed hopes among coal producers that power plants increasingly will shift back to coal, though they say pressure on the industry could persist well into next year.
Murray Energy was the parent company of a Utah coal mine that collapsed in 2007, killing six miners and three members of a rescue team. Earlier this year, Murray Energy affiliates paid nearly $1 million in safety fines for the disaster and settled a criminal case for $500,000.