Spring Creek staff numbers had 'blown out'

The pull-back from underground mining has been made in favour of lower-cost, open-cast operations. Photo / APN

Spring Creek Mine will probably never employ as many staff again if it eventually reopens in future years, after Solid Energy chief executive Don Elder revealed yesterday that numbers had "blown out".

He yesterday personally delivered the message that 220 staff were being made redundant, and the mine put into "care and maintenance".

Most were officially redundant as of yesterday.

Dr Elder said that for the troubled underground mine to reopen it would need a new investor, new equipment, new mining methods, and coal prices to rise.

The company had been talking to future investors for some time, and was in active discussions at the moment.

He was "positive" Solid Energy would find a partner, but even if that happened before Christmas, international coal markets were not favourable.

Dr Elder, who said he intended to stay at the helm of the state-owned company, said the Spring Creek workforce had "blown out" at a time when the mining got harder and harder.

When, not if, the mine reopened he expected a workforce of 150 to 200, he said.

"That's still a heck of a lot of workers."

Asked if management was top heavy, Dr Elder said a lot of people who appeared to be managers were working on new developments, like the proposed Liverpool and Rajah mines further up the valley from Spring Creek.

"There were too many people in total, not just management."

In a good year, Spring Creek had been producing 1000 tonnes of coal per person; at the privately owned Roa Mine, they were getting 10,000 tonnes per person.

In future, Spring Creek would have to produce more, with fewer staff.

Dr Elder said he had apologised to staff for the way the mine review was handled.

"There is no harder job as a manager than telling people they don't have a job. I told them I would keep coming back face to face, so here I am."

Engineering, Printing and Manufacturing Union organiser Garth Elliott said he was aware some men were already looking for work in Christchurch and Australia. Solid Energy had "let these guys down".

"When we went to the Government to present an alternative plan they refused to even look at it. Instead of stepping up to help the people of Greymouth, we saw the same hands-off approach from this Government that's killing jobs and devastating communities all over New Zealand," Mr Elliott said.

All 220 staff will get four weeks' pay, with the final payout, including redundancy, on November 26. It will cost Solid Energy $10 million.

Under the terms of their collective agreement, the men will get one month of pay for every year served, capped at 20 years.

For some, that will bring the total to well over $100,000.

Solid Energy has gone beyond the terms of the collective and agreed to round up the newcomers' service, which means those who have worked there only a few months will have that counted as a year.

Those who secure one of the 16 remaining jobs at the mothballed mine will get to keep their redundancy, the company confirmed today.

Engineering, Printing and Manufacturing Union Spring Creek delegate Trevor Bolderson said Solid Energy had done the right thing by the redundancy, although the men should not be in that position anyway.

People with 20 or more years' service would be quite financially stable in the short to medium term, he said.

"But that aside, they still have to find employment or they are just paying existing bills (with the redundancy)."

Mr Bolderson said some contractors had not been as well treated, and one group was given just one week's notice.