Coal Tattoo

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Mine Explosion

Massey Energy CEO Don Blankenship and other Massey executives just finished having their quarterly conference call with financial analysts about the company’s quarterly earnings report, released yesterday evening.

As I reported in today’s Gazette, that quarterly report had this to say about the financial impact on Massey from the disaster:

Financial results for the second quarter 2010 will include a charge related to the tragic accident at the Upper Big Branch mine. While Massey anticipates further analysis will be required, the Company estimates the range of loss to be $80 million to $150 million for charges related to the benefits being provided to the families of the fallen miners, costs associated with the rescue and recovery efforts, insurance deductibles, possible legal and other contingencies. In addition, the full book value of equipment, mine and longwall panel development and mineral rights at the mine potentially impacted by the disaster is approximately $62 million. Massey will assess these assets for possible impairment once full access to the mine is restored but it does expect to recover much of the equipment.

And in today’s call, several analysts asked Blankenship about what may have caused the horrible explosion that killed 29 Upper Big Branch Miners … Here’s a bit of one such exchange:

Wayne Cooperman, Colbalt Capital:

Do you guys think something actually happened to cause this or was this just sort of a natural occurring phenomenon?

Blankenship:

Obviously, I don’t want to speculate, but either something went wrong from a natural/unnatural manner that was not foreseeable by us or human beings or somebody made a mistake or something. We don’t know.

Later, Blankenship also said:

It’s not due to us not being focused on safety, not having a strong safety culture, not putting safety first.

Some of the implications have been that we don’t focus on safety or we put dollars in front of safety and nothing could be further from the truth.