TribLIVE

| Business

 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

Consol cuts office workers after Murray deal

Email Newsletters

Click here to sign up for one of our email newsletters.

On the Grid

From the shale fields to the cooling towers, Trib Total Media covers the energy industry in Western Pennsylvania and beyond. For the latest news and views on gas, coal, electricity and more, check out On the Grid today.

By Timothy Puko
Friday, Dec. 6, 2013, 6:09 p.m.
 

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 tpuko@tribweb.com.

Subscribe today! Click here for our subscription offers.

 

 


Show commenting policy

Most-Read Business Headlines

  1. Pittsburgh unemployment rate steady as job market shrinks
  2. Steelworkers union says ATI talks to resume
  3. Sniffer lets PixController detect methane gas leaks
  4. Shale gas violations down as DEP steps up inspections
  5. ModCloth gets physical
  6. Trib 30 takes bigger hit than Dow in August
  7. Popularity of emerging markets wanes
  8. Unregulated vape shops fear FDA crackdown
  9. Gasoline prices down nearly a dime in Pittsburgh area
  10. Marcellus shale drillers, Pa. settle 3 cases of fouling water supplies, pay $374K
  11. Alpha Natural Resources executive resigns amid restructuring