Engineering & Mining Journal

JAN 2019

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NEWS - THIS MONTH IN COAL JANUARY 2019 • E&MJ 15 www.e-mj.com A Final Glück Auf for the German Hard Coal Mining Industry By Gerd Strasmann WUPPERTAL, Germany—During Decem- ber, the long tradition of hard coal mining ended with an emotional final act at the Prosper-Haniel mine in Bottrop, Germany. With tears in their eyes and singing the song Glück Auf, based on the traditional German miner's greeting, miners brought the last piece of coal to daylight from a depth of about 1,000 m on Friday, De- cember 21, 2018. "We are here, on Prosper-Haniel, to witness a moment of history, document- ing the end of German hard coal mining," said Frank-Walter Steinmeier, president of the Federal Republik of Germany. Below the now idle Prosper-Han- iel headframe, Mine Foreman Juergen Jakubeit passed the 15-lb chunk of coal to President Steinmeier, who explained that this is a day of mourning for miners. "With this farewell to coal, an import- ant and essential part of German history comes to an end," Steinmeier said. Coal contributed substantially Ger- many's history. A true strategic mineral, it powered the wars of the early 20 th century and, after defeat, it helped re-establish the country as an economic powerhouse. Germany decided to end underground hard coal mining in 2007. At that time about 33,000 miners and other staff were working in the mines. Today there are still 3,000. Generous early retirement arrangements ensured that there were no layoffs. In addition, from 1996 to the present, Germany invested EUR61 billion ($68 million) with contributions from its federal budget and the state of North Rhine-Westphalia to subsidize coal sales, while closing mines. The decline of the Germany's domestic mining industry will also have an impact on the country's mining equipment manu- facturers. Early in the cycle, however, they began to export their skills and technolo- gy. So much so that, today, the domestic market now plays much less of a role in their business plans, with a total turnover expected to decline by 22% to EUR 90 million ($101 million) in 2018. According to Dr. Michael Schulte Strathaus, chair- man of mining for the German Engineer- ing Federation (VDMA), the country's cur- rent policies demonstrate little affinity to the business of extracting raw materials, and therefore mining, and are highly un- likely to provide any impetus for domestic business. Germany's mining equipment industry is therefore becoming increasing- ly dependent on foreign business. While Germany's last hard coal mine has been shut down, Poland is currently expanding the country's hard coal mining activities in an effort to reduce its dependence on im- ports. Hardly any impetus is also expect- ed from the potash and salt industry, as Schulte Strathaus emphasized during the association's annual press conference. The sector expects a further decline from its domestic mining market in the future. Oyu Tolgoi Signs Power Source Framework Agreement Turquoise Hill Resources signed a Power Source Framework Agreement (PSFA) be- tween Oyu Tolgoi and the Government of Mongolia (Government), which provides a binding framework and pathway for- ward for the construction of a Tavan Tol- goi-based power project, as well as estab- lishes the basis for a long-term domestic power solution for the mine. "We are encouraged by the pivotal de- cision to proceed with the power project at Tavan Tolgoi," said Ulf Quellmann, CEO of Turquoise Hill. "Resolving Oyu Tolgoi's long-term power requirements is critically important to the mine's long-term devel- opment and today's signing of the PSFA is a positive milestone toward that goal. We will continue to work closely and collab- oratively with our partners to finalize the details of the power project, which will allow this truly great world-class asset to achieve its full potential for the benefit of all stakeholders." The PSFA formalizes the role of each party and sets out an amended timeta- ble for Oyu Tolgoi to source power do- mestically. Construction is expected to start in 2020 following further studies and commissioning of the power plant is scheduled for mid-2023. Oyu Tolgoi will now move forward to confirm the tech- nical design of the project and finalize the commercial arrangements, includ- ing financing, underpinning the PSFA. The 300-megawatt plant will be majority owned by Oyu Tolgoi and situated close to the Tavan Tolgoi coalfields. Cloud Peak Breaks the Buck The U.S. coal company, Cloud Peak Ener- gy, the largest pure play Powder River Basin coal producer, announced that on Decem- ber 26, 2018, it was notified by the New York Stock Exchange (NYSE) that the aver- age closing price of the company's shares of common stock had fallen below $1.00 per share over a period of 30 consecutive trading days, which is the minimum aver- age share price for continued listing on the NYSE. Under the NYSE's rules, the com- pany has six months following receipt of the notification to regain compliance with the minimum share price requirement. As required by the NYSE, Cloud Peak said it would notify the exchange within 10 business days of its intent to cure the deficiency. The company can regain com- pliance at any time during the 6-month cure period if on the last trading day of any calendar month during the cure peri- od, its common stock has a closing share price of at least $1.00 and an average closing share price of at least $1.00 over the 30-day day period ending on the last trading day of that month. Prosper-Haniel Mine Foreman Juergen Jakubeit hands German President Frank-Walter Steinmeier the last piece of German hard coal. (AP Photo/Martin Meissner)

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