UK Coal’s share price was sent south after the mining and property company warned that pre-tax losses could reach £115 million.

Britain’s largest coal mining company cut estimates of full-year production to 7 million tonnes.  In 2008 coal production was 7.9 Million tonnes.  UK Coal lost £15.7 million in 2008 and has been experiencing geological and technical difficulties at its underground operations in the second half of 2009.

The company hopes to secure more favourable coal-price contracts with generators and return to profit in the next few years.

Ongoing problems at Daw Mill, the largest coal mine in the UK, have affected the coming on steam of new coal.

"We remain focused on getting the new Daw Mill face into production and maximising output from the other deep mines until their new faces are available," the Company said.

The shares yesterday (Friday) fell 4½p to 61½p. Over the past six months UK Coal shares have remained far below historic highs above 400p, not registering the same gains made by some other commodity stocks.