MINISTERS are exploring plans to offload the UK’s biggest coal mine into state-sponsored ownership, in an effort to preserve the future of the listed company behind UK Coal.
Energy minister Michael Fallon said the government was plotting to transfer the financial assets and liabilities of Daw Mill colliery, which was destroyed by fire in February, over to the government-sponsored Coal Authority to rescue its owner UK Coal.
UK Coal split into a privately owned property arm and a listed mining entity, Coalfield Resources, last year in a last gasp bid to keep the company alive.
Offloading the Daw Mill mine – which has already cost UK Coal £100m – over to the Coal Authority would move the costs of the mine over to the state.
It could also prevent the collapse of UK Coal’s heavily indebted pension scheme, which is about £543m in deficit and prevent it entering the Pension Protection Fund.
Fallon told the Sunday Times in an interview given on Friday: “We are looking at whether the ownership of Daw Mill can be transferred back to the Coal Authority,”
It follows a written statement given to the House of Commons by Fallon in which he said the government’s priority “remains to assist the company’s efforts to ensure that as far as possible the viable parts of the business are maintained”.
UK Coal inherited the assets of state owned British Coal when it was privatised in 1994.
It was re-listed as Coalfield Resources in December following the restructure and given a 90 per cent controlling stake in the mining section of the company, called UK Coal.
UK Coal said: “Discussions are on-going with a wide range of interested parties...to find a way forward for the remaining viable mines.”
Shares closed down nearly 15 per cent on Friday.