Union, Luscar talking about co-operation at Balmer mine

The union representing more than 1,000 coal miners in southeastern British Columbia and an Edmonton coal company have taken the first step to save the huge bankrupt Balmer mine from liquidation.

The United Mine Workers of America (UMWA) has agreed to develop a healthy labor relationship with Edmonton-based Luscar, the union and company said recently.

The Balmer mine was closed May 1 after Vancouver-based owner Westar Mining (VSE) ran into trouble, with creditors owed more than $400 million. The mine has been plagued by financial and labor-management troubles. Westar was placed in bankruptcy Aug. 31, with the jobs of the 1,000 union miners and another 300 mine employees in jeopardy.

Nine separate groups have expressed an interest in the assets of Westar, including Luscar, Teck (TSE), Manalta Coal, Smoky River Holdings and BHP Minerals Canada.

Trustee Arthur Anderson would not release the names of the other four interested groups, all of which have paid refundable deposits of $50,000 per mine to conduct a detailed assessment of Westar’s Balmer and Greenhills operations.

The two mines, near Sparwood in southwestern British Columbia, are being treated as separate entities and purchase proposals are due by Oct. 30. The court-appointed trustee has allowed Greenhills to continue operations, but its 400 miners have taken a pay cut to keep their jobs alive. The Greenhills mine is generally viewed as the best asset with current reserves of 15-20 years and no significant requirements for additional capital investments.

A long-range study by Westar last year indicated that the Balmer mine will require an expenditure of some $75 million over a 5-year period to rehabilitate the mine.

If no buyer can be found, the two mines’ equipment will likely be sold and the mine gates permanently locked.

“Before we make a final commitment, we must be certain of a satisfactory relationship with the workers,” said Randall Maradyn, Luscar’s director of human resources.

— Southam News, with files from T.N.M. staff