The European Commission has approved public funding to aid the closure of the Paskov mine in the Moravian-Silesian region of the Czech Republic, which is operated by Czech mining company OKD.
The approval under EU state aid rules is intended to make the closure process easy and provides financial support to those currently working at the Paskov mine.
Commissioner Margrethe Vestager in charge of competition policy said: "Uncompetitive coal mines cannot be kept in the market indefinitely on state support, but the commission and member states can find solutions to help coal miners through this difficult transition.
"I am glad that today's decision will allow the Czech authorities to support the workers that will lose their jobs due to the unavoidable closure of the Paskov coal mine."
OKD had previously attempted to restructure the Paskov coal mine to make it competitive and bring it to economic viability; however, after several failed attempts it decided to close the mine.
As part of the newly proposed Czech rules, one-off severance payments will be offered to workers who have lost or will lose their jobs due to the mine closure.
Bonuses will be paid to workers who had been exposed to occupational health risks while working in the mine.
According to the commission, the closure plan is in-line with EU state aid rules, in particular Council Decision 2010/787/EU, which covers the process of closing uncompetitive coal mines.
Paskov mine primarily produces coking coal, which is a key fuel in steel production.
Image: Paskov mine is operated by Czech mining company OKD. Photo: courtesy of OKD, a.s.