Westmoreland Coal lays off 85 at San Juan Mine

James Fenton
Vehicles approach the San Juan Mine main gate on Thursday in Waterflow. The company operating the mine says it was forced to lay off  85 workers because of a drop in demand for coal.

WATERFLOW — Eighty-five hourly and salaried underground mine workers were laid off at the San Juan Mine today because of a drop in demand for coal, according to Westmoreland Coal Co. officials.

Joe Micheletti — executive vice president of operations for Colorado-based Westmoreland, the new owners of the underground longwall mine — said in a phone interview this morning that there was a workforce reduction because of production cuts related to stricter environmental regulations. Nine more positions were eliminated through attrition or retirement earlier this year, Micheletti said.

But Barry Dixon — Kirtland district office business manager for the International Union of Operating Engineers Local 953 — said this afternoon that union representatives understood 88 workers would be impacted. Union representatives counted 52 miners who were laid off today. Dixon said 36 workers' jobs were lost to attrition or retirement. The union represents all coal miners at the San Juan Mine.

"I was surprised at the number," Dixon said. "It was just 52. The number was not 88 as was determined months ago through six or seven meetings between the union and (Westmoreland). But 52, it still does pain me that we lost 52 employees."

Efforts to reach Micheletti with follow-up questions to resolve the discrepancy in the numbers this evening were unsuccessful.

The logo for the Colorado-based Westmoreland Coal Co. is seen on the sign for the San Juan Mine on Thursday near the mine's entrance in Waterflow.

What was clear was the cause.

Originally, operators said the cost of complying with federal haze regulations would result in the closure of the nearby San Juan Generating Station, which is the mine's sole customer.

In December, after two years of controversial hearings, the New Mexico Public Regulation Commission approved a Public Service Company of New Mexico compromise plan to shut down two of the coal-fired power plant's four generating units. The plan brings the plant into compliance with federal haze regulations while allowing it to continue operations.

Retirement of the Waterflow power plant's Units No. 2 and No. 3 — which cuts the mine's coal requirements in half — is scheduled for completion by Dec. 31, 2017.

Under BHP Billiton New Mexico Coal, the former owner, the mine supplied the generating station with 6.4 million tons of sub-bituminous Fruitland coal each year to generate electricity at the power plant. BHP officially transferred ownership to Westmoreland on Feb. 1.

Now, Micheletti said, San Juan Mine is contracted to deliver half that amount, or 3.2 million tons, per year.

"Layoffs are always regrettable," Micheletti said. "We're taking steps in the placement of these employees and doing what we can to help them make a transition to (future employment elsewhere)."

Those efforts include working with San Juan College and the Public Service Company of New Mexico — or PNM, the generating station's majority utility owner — to assist in retraining and job placement.

The San Juan Generating station is seen, Thursday in Waterflow.

Workers were laid off based on their seniority and skill level, which complies with the collective bargaining agreement between the mine and the union, he said.

After the cuts, San Juan Mine has 361 employees who will work Monday through Thursday in two 10-hour shifts — day and night, according to Gary Kohn, the mine's general manager.

Jodi McGinnis Porter, PNM spokeswoman, said in an email that, unlike the mine, the power plant has no workforce reductions planned.

"PNM committed that there would be no layoffs at San Juan Generating Station, and we are standing by that commitment," McGinnis Porter said.

New pollution controls — selective non-catalytic reduction systems to limit nitrogen oxide emissions, and "balanced draft" technology to reduce particulate emissions — on Units No. 1 and No. 4 are completed and operating, McGinnis Porter said. Those upgrades were part of the PNM plan.

Shutting down Units No. 2 and No. 3 will result in fewer positions, but "those reductions will be handled through attrition," she said.

Nick Miller, a San Juan Mine underground miner for eight years, said he was not laid off today, but he was concerned for his co-workers who may have lost their jobs. Not knowing for sure, Miller, 28, took to Facebook and posted pictures of his mining crew.

In a phone interview this afternoon, Miller, who does not have dependents to support, said he feels a degree of guilt for having kept his job while workers he has grown close to over years, many of whom have families, may have lost theirs.

"I knew a lot of those guys out there, and that's why it’s hard. ... There’s a lot of good people who worked really hard out there, and they have to start over where there’s no other jobs to match what they were doing," he said. "I see these guys (at work) more than (they see) their own families. I’m sad to see a bunch of people go. Either way, I‘m sad people will have to start over, relocate or figure out what they'll do going forward."

Dixon said the state of the coal industry, which has been under pressure from federal regulation intended to reduce greenhouse gases, haze and other emissions, makes future layoffs a big unknown.

"Overall, coal has been treated extremely harshly," he said. "I wish there was better dialogue between the industry and environmentalists. There is going to be a transition from coal to clean energy, but the process that’s in place is going to take years or decades to complete. ... I believe people are very resilient, and new technology to allow coal to be used in a cleaner way will be where we ultimately go. Coal will continue."

James Fenton is the business editor of The Daily Times. He can be reached at 505-564-4621.