Scottish coal industry collapsing
Scotland’s coal industry hit a new low after the Scottish Resources Group (Scottish Coal) announced it is to axe 450 of its 758-strong workforce. It blamed the rise in cheap imports and fracking in the US. The National Union of Mineworkers said it could affect six out of the eight surface mines operated by the group, President Nicky Wilson said: “The crisis has been created by factors outside the company’s control.”
In March 2010, SRG arranged a £47.5m debt facility with Lloyds Banking Group, doubling an existing £23m facility with another banker, which the firm said confirmed the financial strength of the group. But now it has emerged the bank is only prepared to extend the overdraft on a month-by-month basis. In a presentation, managers told workers: “In the absence of new investment and urgent stakeholder support there is a high probability that SRG will be unable to continue.”
This follows Doncaster-based ATH Resources that operates five open-cast mines in Scotland, that went into administration last year. Coal producer Hargreaves Service has recently bought up the debt.
The coal industry generates £450 million for the Scottish economy every year and the supply chain supports 4000 jobs.
- Posted in: Coal