Operations at the largest working coal mine was terminated after fire broke out at the mine leading to redundancy of 650 jobs. The blaze has cost the miner heavy losses including £100m of equipment, £160m of coal and ran up £35m in costs.
Under the company’s liquidation proposal the creditors will be paid £0.32 for every pound of debt, with four power generators who had paid for coal production in advance among the principal losers, The Financial Times reported.
The insolvency would result into the loss of nearly 2,000 jobs.
UK Coal has, however, denied making a comment on the liquidation reports stating that there had been ‘unhelpful and inaccurate speculation’.
Besides, the company’s directors propose that the other deep coal mines will be operated by a subsidiary.
UK Coal chief executive Kevin McCullough stated that the company is currently focusing on safeguarding 2,000 jobs and securing
the future of coal mining industry in the country.
"As with all deals of this complexity there are many moving parts but I hope we are close to securing a way forward for our remaining mines.
"Our remaining mines have been performing well since the fire at Daw Mill and we continue to work closely with our employees, government, pension funds, the Pensions Regulator, suppliers and customers. We remain positive that we have an underlying profitable business," explained McCullough.
