ICG idles Sago Mine due to high costs

ICG idles Sago Mine due to high costs

	Published : Wed, 21 Mar 2007 16:39 By : Agencies Print this Story

CHARLESTON, W.Va. (AP) - Because of high production costs and weak coal prices, International Coal Group Inc. has idled the Sago Mine where 12 men died in a methane gas explosion last year.

Spokesman Ira Gamm described Monday's shutdown as a purely business decision. 'No other factors are involved,' Gamm said Wednesday. 'This was a business decision, part of our ongoing evaluation of our operations.'

The January 2006 explosion at the Upshur County mine was the highest-profile coal mining accident in recent U.S. history and led to sweeping changes in federal and state mine safety laws.

One miner died in the initial blast and 11 others were unable to escape the underground mine and died of carbon monoxide poisoning behind a makeshift barricade. One trapped miner was rescued after more than 40 hours underground.

Separate investigations by the state Office of Miners' Health, Safety and Training and ICG have concluded that lightning likely caused the explosion. But the United Mine Workers labor union issued a report last week blaming friction in the mine's roof support for sparking the blast.

Gamm stressed that ICG is not closing Sago permanently and it could reopen if prices rebound. 'I want to emphasize idled, not closed,' he said. 'A small crew remains employed at Sago to maintain the mine infrastructure.'

ICG has cut the number of underground workers at the mine from 90 last July to 44 at the end of 2006, according to the federal Mine Safety and Health Administration.

'The remaining Sago Mine workers have been offered employment' at other ICG mines, Gamm said. The company's Imperial and Sentinel Clarion mines are located near Sago.

The Scott Depot-based coal company idled several mines in September. ICG also has cut back plans for developing new mines in recent months.

The likes of Richmond, Va.-based Massey Energy Co. and Pittsburgh-based Consol Energy have idled mines recently as well in response to weak coal prices and high costs for diesel fuel, explosives and labor.

Sago produced 323,000 tons of coal last year, but Gamm said the mine had run into tough geological conditions. 'It wasn't roof falls. It was more in terms of amount of yield,' he said. 'It's a percentage of coal versus a percentage of rock that you mine.'

ICG's stock rose 5 cents, or 1 percent, to $5.06 in early trading Wednesday on the New York Stock Exchange.