Restructuring of coal mines: theory and practice




restructuring, mines, models, organizational structures, merger


The coal industry of Ukraine has a dominant role in addressing the problem of energy resources. Stabilization and development of the industry through restructuring, technical reequipment of coal mining processes, improvement of labor efficiency and competitive pricing of products are therefore topical.

The article describes the state-of-the-art of the coal industry of Donetsk Region. Commercial reserves of mines exceed 3.6 billion tons, which suffices to produce 32-43 million tons of coal within 100 years.

A review of Ukrainian and international sources of literature, made by the author, allowed to make a comparison table for the meaning of term 'restructuring' and identify its components for the coal industry such as structure, diversification, technology etc.

Different change management models of companies are examined, specifically those developed by I. Ansoff and L. Greiner. Based on the research and analysis of theoretical and actual data conducted, a structural model of a coal mine restructuring process is proposed. A number of structural and technological changes are described.

The structural changes include those at the mine and global levels. Use of an organizational structure 'pegged to a project', which expediency was confirmed by operational experience of the staff of Krasnolimanskaya Mine Ltd, fits into the first group.

Restructuring of the coal industry goes hand in hand with diversification of mining companies. Among the most promising is a concept of mine operation, which implies deeper processing of coal, coal-bed methane and coal mining waste through generation of thermal and electric power as well as introduction of highly efficient heat-consuming technologies.

Practical experience demonstartes that the most common options for achieving global changes are:

- Reduction. The number of coal mines in the Donets Basin keeps decreasing. At present there are 52 companies (50 mines and 1 coal preparation plants) under liquidation;

- Merger or affiliation of mines with large corporate structures, for example the Metinvest Group with its vertically integrated business model.

Today the Krasnodonugol PJSC is among the major companies of Ukraine, which produce coking bituminous coals, and is a part of the Metinvest Group Mining Division. It enabled the coal company to develop, expand its production capacities, retain and create new jobs. 

Author Biography

Iryna Sapytska, Donetsk National University

Candidate of Engineering Science, Associate Professor



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How to Cite

Sapytska, I. (2013). Restructuring of coal mines: theory and practice. Skhid, (4(124), 71–75.