Consol cuts office workers after Murray deal
Consol Energy Inc. is cutting around 100 office positions as part of the fallout of its $3.5 billion coal mine sell-off.
The company sold five West Virginia mines as part of a historic shift for its business to focus more on gas drilling and less on coal mining. That led to the cuts after the deal closed Thursday, with the company dropping workers from human resources, accounting, information technology and other departments who it no longer needs after sending half of its coal operations to Murray Energy Corp.
The company had said the deal would save it $65 million a year in administrative expenses, partly from eliminating workers.
The company notified most of the affected workers on Friday and will notify more next week, but there won't be more employee purges once this one ends, officials said.
“The unfortunate timing of this realignment before year's end, while difficult for all involved, was largely driven by the process of the transaction itself,” the company said in an emailed statement to the Tribune-Review.
“Corporate restructuring related to the sale of these assets represents a portion of the savings, while other business-related expenses will make up the remainder of the reductions.”
About 3,800 employees switched on Thursday from Consol to Ohio-based Murray as part of the sale. Murray does not intend to cut any of those workers, mostly union miners, Murray spokesman Gary M. Broadbent said.
“Nobody is being let go or demoted,” he said.
Consol pursued the deal after months of a foundering stock price and several quarters of losses.
Consolidation Coal Co., the subsidiary that once gave it its name, was central to the deal because of how closely it was tied to the sluggish domestic power market.
Competition from the glut of cheap natural gas and tightening environmental regulations have hurt business for coal-fired power plants and their suppliers.
Consol's stock price had fallen to $26.51 per share July 4 and started climbing only after its executives publicly discussed a shake-up. It closed Friday at $36.59 per share, down 69 cents.
Consol now has about 5,000 employees, down from nearly 9,000 before the sale.
Of those let go this week, about 75 were not voluntary, according to the company. The rest took retirement packages, and there were severance packages for people who didn't qualify for retirement. Officials could not immediately say how much that payout would cost.
Timothy Puko is a Trib Total Media staff writer. Reach him at 412-320-7991 or email@example.com.