Coalfield Resources shares hit by fire at UK Coal mine

Shares in Coalfield Resources fell Monday morning after its part-owned subsidiary, UK Coal Mine Holdings, reported a 'major' underground fire at Daw Mill Colliery.

Shares in Coalfield Resources fell Monday morning after its part-owned subsidiary, UK Coal Mine Holdings, reported a 'major' underground fire at Daw Mill Colliery.

UK Coal issued a statement saying that on Friday afternoon a major fire broke out underground at Daw Mill Colliery in Warwickshire and that it is not expected that the mine could be recovered to operational status in anything less than three to six months.

Advertisement - Article continues below

The mine had already been the subject of significant uncertainty over the last year. The restructuring of UK Coal in 2012 achieved medium-term security for the mine providing it was able to produce coal safely reliably and efficiently.

"The fire puts that security for Daw Mill seriously in doubt and the company will consult over coming weeks with the workforce on the implications for them," UK Coal said.

The fireAs a precaution UK Coal evacuated 92 underground workers from the mine in accordance with standard emergency procedures. However, four hours after the fire broke out the situation had become serious enough to evacuate all miners and this was completed within 90 minutes.

The group said that in an attempt to stem the fire, ventilation to the mine was switched off at 22.45 hrs to reduce oxygen levels and attempt to starve the fire. There is no risk or impact from the incident to residents living close to the site or above the mine, it added.

Advertisement - Article continues below

The company plans that a core team will remain at the mine to bring the situation under control and achieve an orderly closedown of operations.

Statement from UK CoalThe group gave the following statement: "The company has been in close contact with officials at the Department of Energy and Climate Change over the weekend who have recognised the exceptional severity and hazards of the fire at Daw Mill.

"The Department has indicated that it will work directly, and through the Coal Authority, to assist UK Coal Mine Holdings to ring-fence the situation at Daw Mill and to seek, in the public interest, that the company achieves a prompt, safe and orderly close down of the mine over coming months.

"All parties have also indicated their support to ensuring that the remaining businesses of the company, which are viable, continue to operate without disruption."

The Chief Executive of the business, Kevin McCullough, commented that the fire was on a scale "not seen for decades".

Coalfield Resources is joint owner of UK Coal, alongside UK Coal Employee Benefit Trust.

The share price fell 9.43% to 5.76p by 10:20 Monday.




Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular


House price crash: UK property prices are falling – so where next?

With UK property prices falling for the first time in eight years, are we about to see a house price crash? John Stepek looks at what’s behind the sli…
2 Jul 2020

The end of the bond bull market and the return of inflation

Central bank stimulus, surging post-lockdown demand and the end of the 40-year bond bull market. It all points to inflation, says John Stepek. Here’s …
30 Jun 2020

How can markets hit new record highs when the economy is in such a mess?

Despite the world being in the midst of a global pandemic, America's Nasdaq stock index just hit an all-time high. And it's not the only index on a bu…
3 Jul 2020