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9 January, 2006
International Coal Group (ICG), the US-based company responsible for 12 mining deaths last week in the state of West Virginia, operates 21 US coal mines in America, all non-union. Yet, three emergency-response teams from nearby United Mine Workers of America (UMWA) staffed mines, plus the ICEM affiliate’s Health and Safety director were involved in rescue efforts at ICG’s Sago mine on 2 January after 13 miners became trapped following a gas explosion.
ICG has become a major eastern US coal supplier to utility companies at a time of high demand and high prices. The company is a creation of Wilbur L. Ross, a bankruptcy buyout opportunist who has a two-decade-long record in steel, textile and now coal bankruptcies. Ross uses US court bankruptcy proceedings to gain tax deferrals and cancel workers’ bargaining rights, pension benefits and retiree health care.
ICG bought bankrupt Horizon Natural Resources, Anker Coal Group and CoalQuest Development, among others over the past few years. ICG gained a stake in Anker, the former owner of Sago, in the early 2000s and increased his holding as the company weakened and entered bankruptcy in 2002.
He only recently finalised buyout of the company for US$173 million, adding some eight coal mines and loading facilities to ICG. Also in late 2005, Ross took ICG—founded only in 2004—public, infusing US$250 million cash into the firm, and causing Ross to state: “It’s all new money for the company. Neither my firm nor the founding shareholders are selling any stock on the offering at all.” Ross’s controlling stake increased from 9.2% to 13.7% on the initial public offering.
It is evident Ross’s “new money” and current coal revenue profit-taking are not intended for miners’ social welfare, whether it be retirement benefits or job safety. On 30 August 2004, 17 UMWA members were arrested by police when they and 800 others protested before a US bankruptcy court in Louisville, Kentucky. Some 3,000 UMWA members, both active and retired, were about to lose job security, and health care coverage as Ross and IGC took control of Horizon at a discount value in the bankruptcy court.
Early last week, the UMWA was actively involved in saving lives at the Sago mine. In a statement by the union expressing deep sadness to miners’ families, and reflecting on the “inexplicable confusion” over initial reports that the miners were alive, President Cecil Roberts said, “Though not members of UMWA, the miners who work in the Sago mine include neighbors and relatives of UMWA members.” The efforts of rescuers, he added, “demonstrate once again that we are all brothers and sisters in the coal fields, and we pull together to help each other in times like these.”
Roberts had another message last week, published in a West Virginia newspaper. It concerned the effect that energy demand and high coal prices have on marginal properties with inferior safety records when pressed into service: “We hope we don’t lose the focus on how dangerous this business is,” stated Roberts.