Deadly Coal Mine Blast Was Not Massey's Fault, CEO Says
Massey Energy "has a totally clear conscience" about the explosion at Massey's Upper Big Branch mine in West Virginia that killed 29 mine workers in April, CEO Don Blankenship told coal industry analysts Wednesday.
"We don't feel like we contributed in any way to the accident," Blankenship said, citing the company's safety practices and changes in the mine's ventilation plan imposed by federal regulators.
The conference call with analysts followed Massey's announcement of its third-quarter financial performance. The company reported a $41.4 million loss, blamed on increased regulatory scrutiny and lost production triggered by the Upper Big Branch tragedy.
Blankenship acknowledged rampant speculation that Massey is up for sale by noting that the company is conducting a regular review of "strategic options" that could increase shareholder value.
Massey is "conducting a very deliberate process to consider all options," Blankenship said, before saying he could not comment about any specific opportunities.
Blankenship also described "preliminary observations" about the cause of the Upper Big Branch explosion. "We are certain that methane was the fuel for the explosion," he said. "We do not believe that coal dust was a meaningful factor."
Massey has maintained that a massive and natural infusion of explosive methane gas suddenly hit the mine just before the blast. Coal dust is an accelerant, and federal mine safety investigators have suggested excessive coal dust in the mine drove the blast around corners and more than two miles underground.
Both before and after the accident, some Massey mines had injury and safety violation rates that were higher than the national average. Blankenship said the company was taking steps to reduce safety violations with more training, including "hazard reduction teams" and a program that identifies specific miners responsible for specific violations.
Massey is also stepping up its own internal inspection process. And it's halting all underground coal production company wide Friday, to devote the day to safety. Blankenship acknowledged that the increased scrutiny after the April disaster is understandable.
"Of course, we're the ones that had the tragedy," he said. "And that brings a lot of focus."
But the Massey CEO also said the mines under scrutiny are getting more violations "not because we feel like the mine is more dangerous or because we're not trying real hard," but because these tend to be much larger and older mines and they're "much more difficult to avoid violations that give us issues."
The Wall Street analysts listening in also focused on market conditions and Massey's future production plans. They apparently liked what they heard. Massey stock rose 4 percent in trading after the call.