Scots mine saved by £17.5m boost

Longannet has up to 50m tonnes of reserves

The European Commission has approved a £17.5m funding package which will secure the future of the Longannet coal mine in Fife.

It has rubber-stamped the UK Government aid for Scotland's last deep mine, which employs 650 people.

The cash is part of a £100m boost for the UK's coal industry, which ministers say will help pits with a viable long-term future but which are suffering from short-term problems.

There is no doubt that the government subsidy has saved the mine

Ross Harper, Mining (Scotland) chairman

The EC gave the go-ahead for the entire package last month, but has to approve each subsidy payment on an individual basis.

The Longannet aid application is the first to receive approval under the UK Coal Operating Scheme.

Ross Harper, the chairman of Longannet's owners Mining (Scotland) Ltd, explained that the subsidy would pay for losses incurred over the last eight months.

"We have encountered horrendous geological faults and there is no doubt that the government subsidy has saved the mine," he said.

Environmentally-friendly

"Without the subsidy scheme the mine would surely have closed and jobs established over the last 20 to 30 years would have been lost forever.

"The mine, if closed, would never be re-opened because of the enormous costs involved."

He said there was between 20 and 30 million tonnes of economically recoverable low-sulphur coal at the mine, which would provide an environmentally-friendly fuel source for the neighbouring Longannet power station.

And he said the cash meant the mine could now move forward and develop its reserves.

Helen Lidell: "Best possible Christmas present"

"We know there is a lot of work to be done and work has already been started in bringing the management and working practices of the mine up to date," said Mr Harper.

UK Energy Minister Helen Liddell said: "This must be the best possible Christmas present for the 650 people working at the Longannet coal mine.

"I am confident that this payment will help to ensure that Longannet is a mine with a future."

And she added: "I am well aware of the importance of this money not only to the Longannet mine, but to the wider community.

"I am grateful to the commission for its speedy approval of this payment."

State subsidies

A spokesman for the National Union of Mineworkers described it as good news for the industry, adding: "It is the best Christmas present our guys could have."

Production on the Kincardine Reserve, beneath the Firth of Forth, began last December and was said at the time to have the potential to secure the 650 jobs for 20 years.

There was a second boost for the mine with the announcement that Scottish Coal, which operates six opencast mines and owns Mining (Scotland), would relocate its headquarters to Longannet.

The move brings 50 jobs to the site.