Posted on 05/12/2015 6:42:58 AM PDT by Rodamala
CHARLESTON, W.Va.
Patriot Coal Corp. filed for Chapter 11 bankruptcy protection Tuesday for the second time in three years.
The company made the filing in U.S. Bankruptcy Court for the Eastern District of Virginia. It had emerged from an earlier bankruptcy case in December 2013 in Missouri.
Patriot said it is involved in active negotiations for the sale of its operating assets to a strategic partner.
Patriot said it will continue shipping and mining operations and it has received a commitment for $100 million in debt financing from secured debt holders that it did not identify.
(Excerpt) Read more at abcnews.go.com ...
Patriot Coal is a producer and marketer of coal in the eastern United States, with operations and coal reserves in the Appalachia coal region. We and our predecessor companies have operated in this region for more than 50 years. Headquartered in Scott Depot, West Virginia, we employ approximately 2,900 people with 900 represented by the United Mine Workers of America and 2,000 non-union represented employees.
In 2013, we sold 21.5 million tons of coal, of which 70% was sold to domestic and global electricity generators and industrial customers and 30% was sold to domestic and global steel and coke producers. We shipped a record 48% of our volume to locations outside the U.S. in 2013.
http://www.patriotcoal.com/index.php?view=operations&p=3
Patriot Coal was created or organized by Peabody Coal for the specific purpose of going bankrupt. Peabody Coal had a major problem with unfunded liabilities for pensions, other liabilities, and underperforming mines. To unload those liabilities, Peabody Coal setup Patriot Coal using these less desirable mine assets and the pension liabilities knowing full well Patriot Coal most likely would discharge the pension liabilities in a bankruptcy.
And this situation was created in the first place - how?
United Mine Workers had the major coal producers by the throat decades ago, promising total shutdown if their sometimes excessive demands were not met. At that time, America was still heavily dependent on coal in every form for its industrial base, and it was “in the national interest” for the labor unrest to be settled for the foreseeable future. Thus the settlements highly favorable to the union leadership (and not particularly favorable to the industry), but the coal producers could pass their higher costs to the consumer directly, without question, as there was no substitute for coal at the time. With the growing utilization of natural gas and the advent of atomic-powered generation stations, and the building of the national grid, dependence on coal lessened over time, but the coal producers were still saddled with these legacy costs. The natural response was to close the mining operations, and bankruptcies followed.
Every professor of economics KNOWS this progression, but whether they teach it or not, is another question.
Your air will be cleaner while you freeze to death.
As a past trader and investor in those companies, it was important to understand where the stock values were headed and why.
In ‘08 the mining union’s home page was a letter of support for hussein and that was after he promised to shut them down. Mind boggling stupidity.
It is mind boggling, yet remember that for true dyed in the wool yellow dog UMWA members, hatred of the company overrides any common economic sense. They still are fighting their grandfather's mine wars of the early 20th century.
The one thing he did not lie about and nobody believed him.
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