17 Aug 2013

Genesis rejects union mine allegations

12:25 am on 17 August 2013

Genesis Energy says there is no truth in allegations from the Engineering, Printing and Manufacturing Union that the use of imported coal at the Huntly Power Station is costing miners their jobs.

State-owned mining company Solid Energy announced plans on Thursday to cut 93 jobs at its Huntly East mine, equating to more than half the mine's workforce.

The EPMU says Genesis Energey is undermining miners' jobs by using cheap coal from Indonesia at its Huntly Power Station.

However, Genesis Energy spokesperson Richard Gordon says that's not true because Huntly East mine's coal is used to run the Glenbrook steel mill, not the power station.

He says the power station doesn't use any coal from the Huntly East mine because that coal has the wrong specifications and is best used in steel manufacture.

Mr Gordon says the Huntly Power Station only uses imported coal when it can't get enough from New Zealand mines because overseas coal is more expensive than local coal.

But the union's mining advocate, Ray Urquhart, is sticking to his guns, saying the power station can use coal from the Huntly East mine.

Mr Urquhart says closing Huntly East means the Huntly West mine will have to send more coal to the Glenbrook steel mill, so Genesis will have to use more imported coal to run the power station.

Questions surround mining future

Former West Coast miner Trevor Bolderson says underground mining has no future in New Zealand.

Hundreds of Solid Energy jobs went when the company mothballed its Spring Creek mine on the West Coast last year.

Mr Bolderson, who was a miner and union delegate at Spring Creek, says underground mining is on the way out.

"I know it's the nature of the beast to come in and out of favour, so to speak, but all the pointers are there. I just don't see a future for underground coal mining in New Zealand," he said.

Mr Bolderson says the writing has been on the wall ever since the Pike River disaster, which took the lives of 29 men.

However, Mr Urquhart says underground mining will revive.

He says there have been downturns before, albeit not quite as bad as this one.

"I think that as times change and the company can see that way, then they're preserving each mine for future years and I think it could turn round and start up again," he said.

Mr Urquhart told Morning Report the job cuts at the mine were expected but the final figure was surprisingly high.

Solid Energy owes about $390 million and is reviewing its business in response to the downturn in the international coal market and its high levels of debt.

It has been in talks with its bankers and the Government about its future and Prime Minister John Key is still not ruling out a government bailout.