Maltby mine closure fear leaves 500 jobs in balance

Up to 500 workers could lose their jobs after one of Britain's last remaining coal mines warned it could close after finding gas, water and oil leaking out of a new face.

The presence of these substances forced Maltby Colliery to abandon a new "panel" of coal earlier this year on safety concerns and prompted a full investigation. The review of safety and financial risks involved in mining the panel, known as T125, is due to be completed at the end of next month when a decision will be taken on the future of the 100-year old mine.

"We anticipate the abandonment of the T125 panel would lead to the mothballing or even closure of the mine as it would probably be uneconomic to switch production to a later panel due to the long face gap entailed," a company spokesman said.

Maltby produces about one million tonnes of coal a year, with about 60 per cent of its total output supplied under a long-term contract with Drax, Europe's largest coal-fired power plant, based in North Yorkshire.

Much of the remaining production is sent to the Monckton works near Barnsley, where Maltby's owner, Hargreaves Services, produces 200,000 tonnes of coke for use in the production of glass, detergents and steel manufacturing.

Shares in Hargreaves Services, tumbled by 143p, or 21 per cent, to 551p, despite the group's chief executive Gordon Banham insisting it was strong enough to absorb any closure.

As the largest importer of coal into the UK through terminals at Immingham and Newport, Hargreaves yesterday reported a good year for the group with profits rising by 16.8 per cent to £43.1m in the year to 31 May.

Hargreaves first warned in May that "unusual geological conditions" threatened profits, as oil and water started to seep into new sections and cause production delays.

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