HUNTINGTON — Citing high operating costs, PacifiCorp announced Monday that next year the company will shutter the Deer Creek Mine located near the Huntington power plant in Emery County.
Energy West Mining Co., PacifiCorp’s subsidiary operator of the mine, notified the mine’s 182 workers of the pending closure.
PacifiCorp also signed a long-term coal supply agreement with Bowie Resource Partners to supply coal for the Huntington facility.
“We have evaluated what is in the best interest of our customers and determined it no longer makes economic sense to keep the Deer Creek Mine open,” Micheal Dunn, PacifiCorp Energy president and CEO, said in a prepared statement.
The news of the closure will have an effect on the community, said Huntington Mayor Hilary Gordon.
"I think it's especially hard at this time of the year," said Gordon, whose son-in-law is a miner at Deer Creek. "It's always about change. And I think there will be jobs available. I just hope the economy doesn't suffer too much."
The Deer Creek Mine has an estimated five years or less of reserves, but much of the remaining coal has higher ash and sulfur content that has made mine production considerably more expensive and made it more costly to comply with mandated air quality standards, said Energy West spokesman Paul Murphy.
"The costs for operating the mine have escalated substantially and the amount of coal we've been able to retrieve has deteriorated, so right now the mine is no longer economically viable," Murphy said.
Rapidly escalating pension liabilities for the mine’s union workforce was also a major contributing factor in the diminishing economic viability of the mine, he added.
"We tried for 18 months to sell the mine and unfortunately we weren't able to find (a company) to take on the mine," Murphy said. When the mine is officially closed, the land will be reclaimed.
The Deer Creek Mine began operation in 1974. Pending regulatory approval, PacifiCorp is targeting the mine closure for early to mid-2015.
Gordon said some previous workers at the mine anticipated that it would close and left for other jobs.
"There was a lot of them that had worked there that had done what they call a 'jump ship' earlier on and had moved because they were afraid of this happening," she said.
Besides worrying about job prospects for those miners who will be unemployed, the mayor also worries about the impact the change will have on the city's infrastructure. PacifiCorp still has its power plant, but it will now get its coal from another provider. She expects the coal will be trucked over her roads.
"The mine's burning somewhere between 10,000 and 12,000 tons a day, so instead of it being mined right there and belted in, it's going to be trucked in. So that will be a big impact on our town for the extra coal trucks coming through," she said. "I believe those trucks hold about 40 tons."