Cliffs Natural Resources Inc., citing a continuing softness in the demand for metallurgical coal used by the steel industry, announced that it is taking a number of steps at its mines in West Virginia and Alabama to align its 2009 production with customer demand.
In West Virginia, its wholly owned subsidiary Pinnacle Mining Company LLC , has indefinitely idled its Green Ridge No. 1 mine. In addition, its Pinnacle mine will halt production beginning on April 13 for approximately two months. Layoffs associated with the idling of the Green Ridge No. 1 mine and reduced operations at the Pinnacle Prep Plant affect 90 employees. The production curtailment at the Pinnacle mine will affect approximately 200 employees.
Operating levels at Cliffs’ wholly owned Alabama subsidiary Oak Grove Resources, LLC, will also be reduced, resulting in the layoff of about 65 employees at its Oak Grove mine and Concord Prep Plant.
“We are making these production adjustments due to the reduced demand for metallurgical coal in the United States and throughout the world,” said Don Gallagher, president of Cliffs Natural Resources North American Business Unit. “As we go forward, we will continue to review our operating levels to ensure that we balance our production and inventory with customer demand.”
These production adjustments will put the current 2009 annual operating rate at approximately 2.2 million tons.
The Pinnacle, Green Ridge No. 1 and Oak Grove mines produce metallurgical coal for the steel industry. Metallurgical coal demand has been reduced as the steel industry has cut back production in the face of the global economic slowdown.