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Alpha Natural Resources Cuts Accident Rates

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Coal supplier Alpha Natural Resources (NYSE: ANR) has made great strides in reducing accidents and injuries, prosecutors said Monday.

The news came six months after a $210 million settlement following the 2010 mine explosion that saw 29 people killed.

Since then, Alpha Natural Resources has cut its accident rate by a third and its injury rate by a quarter. Additionally, the company opened an $18 million training facility that is expected to positively affect the industry.

U.S. Attorney Booth Goodwin said that he is satisfied that Alpha Natural Resources has made substantial progress in its attempts to overhaul its Massey Energy mines that it acquired in the summer of 2011.

"This is like turning a freight liner," Goodwin said. "This is a company that now has 11,000 coal miners, and they can't just turn on a dime. But they got pretty close."

It was in April 2010 that a methane and coal dust-fueled explosion killed 29 workers in the mine. Located in West Virginia, the explosion was the worst coal mining disaster in the U.S. had experienced in 40 years. The tragedy led to the retirement of then-CEO Don Blankenship, while criminal charges were brought against a security chief and a former superintendent.

Reports following the incident found that the accumulation of the methane and coal dust, plus worn machinery, was the cause of the explosion.

In the time since then, Alpha said that it has added safety officers to some mines, conducted remedial maintenance and installed sensors that monitor air flow, created a research and development foundation, and hired a regulatory compliance director.

The work needs to be done because, as of the beginning of June, inspectors at Alpha's Road Fork No. 1 in Wyoming County found, "inoperable smoke detectors and fire suppression systems, and accumulations of coal dust as deep as 18 inches. MSHA said managers charged with safety inspections failed to report or record obvious safety hazards, or fix the ones they did list."

"We don't mean to paint that everything's coming up roses," Goodwin said. "They still have room to improve."

It is reassuring that he knows that.

On Monday, Alpha Natural Resources was trading at about $8.80, up roughly 3.1%.

Follow me @BCallwood.

Posted-In: Booth Goodwin Don Blankenship Massey Energy MSHANews Topics Management General Best of Benzinga

 

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