BENWOOD - Effective Dec. 31, Murray Energy Corp. will cut off health benefits to salaried retirees from the five West Virginia coal mines it bought from Consol Energy in December, company officials confirmed Wednesday.
Retirees affected include those at the company's Ohio County Mine in Benwood, formerly known as the Shoemaker Mine, and at the former McElroy Mine near Moundsville, now known as the Marshall County Mine. The decision will also impact retirees from two Marion County, W.Va., mines and another mine straddling the Monongalia County, W.Va.-Greene County, Pa., border that Murray also acquired in its $3.5 billion deal with Consol.
The move won't impact union members, who will continue to receive coverage according to their United Mine Workers of America contract, which expires at the end of 2016.
As of the end of the year,
Murray Energy Corp. will no longer
benefits to salaried retirees at the five mines it
Consol Energy last year,
including the Ohio County Mine in Benwood, shown here.
According to published reports, almost 1,200 retirees - including about 1,030 in West Virginia - will lose their health insurance, although the company declined to comment on the figure. The purchase agreement between Consol and Murray Energy calls for the St. Clairsville-based company to continue providing health benefits for at least one year following the closing date of Dec. 5, 2013.
Murray officials said this will bring the five West Virginia mines in line with the rest of the company, which does not provide medical insurance to its salaried retirees. Those operations include the Century Mine near Beallsville and the Powhatan No. 6 mine near Powhatan Point.
The company also cited tightening U.S. Environmental Protection Agency regulations targeting carbon emissions as a factor in the decision.
"Murray Energy's inability to provide these benefits is, in part, due to the destruction of the coal industry, including our markets, by the Obama administration and its appointees and supporters, who have eliminated the livelihood of thousands of coal miners, and their families, by the forced closing of 392 coal-fired electric power plants in America, now and in the immediate future," the company said in a prepared statement issued by spokesman Gary Broadbent.
Murray declined to provide a copy of the letter sent to retirees informing them of the loss of benefits. The company said it has provided those affected with information about alternate coverage, and estimates 80 percent of the lost benefits can be made up through Medicare.
In October, Consol announced its intention to sell the five West Virginia mines to Murray Energy for $3.5 billion, a move company officials said would allow it to focus on its growing natural gas operations.
The sale more than doubled Murray's total employment from 3,300 to 7,200 and nearly tripled the company's total coal reserves from 859 million tons to almost 2.4 billion tons. It also vaulted the company into fifth-place in annual American coal production.
Earlier this month, Consol announced its natural gas production for the first quarter of 2014 had increased 23 percent over the same period last year.