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Walter Asks : How Deep is Your Love ?

The most controversial coal mine in UK history has seen its executives (one former and one existing) appointed by Government to the official bodies tasked with "Delivery of the GDF. " The promoted GDF is being touted in the area immediately adjacent to the coal mine plan under the Irish Sea. In March the Chief Executive Officer of West Cumbria Mining will be giving a talk promoting Delivery of a GDF - he has been employed by government to do this!

The lack of press and mainstream NGO scrutiny and questioning over this and other appointments is noteworthy.

Walter has written the following emails, and he raises questions that the mainstream press and conservation and environmental bodies SHOULD BE ASKING instead of expressing their continued surprise to a gullible mainstream press at why Government is so damn keen on this coal mine. It is no surprise when you view it through the prism of the Government's desperation to get the ducks lined up for one or more GDF's. Of course they are prepared to suffer some climate embarrassment in order to keep the nuclear shebang going. What is mystifying is why mainstream groups continue to give the nuclear industry a free ride. They are doing the public no favours.

Here are Walter’s thoughts...

"The Haig Pit mined for Anthracite, the top grade of Metallurgical coal. It was as financially viable as Warrior Coal and most certainly more viable than WCM could ever be. The Haig Mine was closed and capped because it was too dangerous due to the methane levels.It had killed too many men in its life. I was born in Frizington, the mining village near St Bees; my father was a miner, as were my grandfather and great-grandfather. I am now over 90 years old, but I am far from senile. I am appalled that undersea excavation of the seabed is proposed at a location only 9 miles from Sellafield, which is classified as the most dangerous industrial site in Europe. If the excavations cause an earthquake at Sellafield, and the decaying steel surface tanks, which contain a toxic mix of nuclear waste (including 3000 kg of Caesium-137) are breached, releasing their contents into the atmosphere, then a large area of North England could be made uninhabitable for years. At Chernobyl, only 27 kg of Caesium-137 was involved. West Cumbria Mining (WCM) Ltd is 80% owned by EMR Venture Capital, which is registered in the Cayman Islands, and the decision as to whether permission to mine is granted to WCM is being left to the Cumbria County Council. The people of Cumbria have not voted on this matter, but they should, and the final decision, which will be of such grave importance, should be made at Cabinet Level and have the personal attention of the Prime Minister. I think it would be fair to ask why, in a matter of national importance, did the Government not insist that only companies registered in Stock Exchanges, such as the London Exchange or equivalent, be allowed to seek permission to mine in such a sensitive location, only 9 miles from Sellafield. Several other important points come to mind: Is it feasible that WCM, mining under the sea for metallurgical coal, could obtain results that would ever be attractive for a Private Equity Company like EMR? (The major Met Coal miner in the USA (Warrior Coal) has a PE ratio of 59, ie, it will take 59 years for earnings to recoup the stock price). Thus, we ask what is EMR’s real motive? EMR would never invest in an operation with a PE of 59, unless they saw a hidden pot of gold in it. My own opinion is that the WCM proposal would be bound to be a loss-making operation for many years. Therefore, I suggest this operation would be quickly closed by EMR, once their hidden goal was achieved, namely, the creation of a Geological Disposal Facility (GDF) under the sea off St Bees headland, in spite of the geological unsuitability of this site. Look at the painstaking work done by Sweden in determining the location of its GDF, and the huge expense entailed. I have not found any analysis of the financial viability of the WCM proposal, but there is clear evidence of the weakness of WMC’s case here: WCM was, right from the start, nothing more than the PathFinder for a GDF undersea, offshore from Sellafield. I am sure one of the reasons WCM is registered in the Cayman Islands was to hide the Financial facts away from examination. It is absolutely certain that WCM never could make a viable economic case for the mine, and once it has done its PathFinder work for a GDF, it will be allowed to go into bankruptcy.So much for the 500 jobs.For the sharks at ERM it is the GDF which is the pot of gold it is after.

I suspect the government has always been aware of all this but is desperate to be rid of the Sellafield nuclear risk.that is probably why Jenrick waved it through and was happy to let the county council take the decision. If (and it is a big if) the Council turns the mine down it will be intriguing to see how the government acts.

It is very surprising no one seems to have asked why was it considered necessary to register WCM in the Cayman Islands. A mining company does not need such a registration unless it has something it wishes to hide.

Nor does anyone appear to have looked at the results of the USA Miner of Metallurgical Coal.

The company, is Warrior Coal, which lists on the NYSE and therefore its results are public.

Warrior mines on sites which are deep below the surface and are mined using standard excavation equipment.It is a well run company and is very efficient, It sells Metallurgical Coal globally, yet it struggles to make an acceptable return on capital. How, therefore, will WCM, mining under sea, with all the complications and expense, succeed.? Organisations like ERM which owns WCM normally looks for a return on capital of 50%

They certainly will not get it out of WCM, so what is its motivation ? The answer is probably that WCM is the PathFinder for a GDF - that is the pot of gold that ERM is after. A GDF involves investments of many billions of $, much of it public money, over many years. ERM is looking to access all that lovely money.

A GDF requires years of study to find a suitable location in stable rock, thus, an undersea location of dubious stability is clearly unsuitable for a GDF.

WCM probably will go into bankruptcy after a few years of a loss-making operation.

It is essential that, before the County Council grants permission it insists on being provided with the financial calculation made by ERM and WCM.

The real reason for WCM’s proposal is nothing to do with mining coal, it is to let ERM mine the gold in the form of the billions of public money coming from a GDF.

I think it is fair to ask the Labour Office if it has looked at the example of Warrior Coal in the USA, and asked why the true basis of WCM is hidden by the Cayman Islands Registration.

I think it is fair to ask the Guardian why it has not made any attempt to probe just what is going on with WCM/ERM and the British Government.

I think it would be fair to ask why in a matter of National importance did the government not insist that only companies registered in Stock Exchanges, such as the London Exchange or equivalent, be allowed to seek permission to mine in such a sensitive location only 9 miles from Sellafield.

I’ve also attached below some relevant links.

note: the mine would extend to within 5 miles of Sellafield

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