Alpha Natural Resources says lenders offer $500M for coal, gas assets
Alpha Natural Resources said it has received a $500 million offer from existing lenders for the potential sale of the bankrupt coal producer's core assets.
A filing Monday in U.S. Bankruptcy Court in Richmond said the unspecified lenders agreed to serve as the lead bidder. The offer would set the floor for an auction process that lets competitors make higher bids.
Bristol, Va.-based Alpha filed for Chapter 11 protection in August. Since the filing, the company has announced plans to lay off hundreds of workers in central Appalachia, citing tough market conditions.
“As part of our overall restructuring effort, we believe this process will provide the best chance of preserving jobs and maximizing the value of the broader enterprise for all stakeholders,” Alpha said in a statement Tuesday.
The offer includes all Alpha coal assets in Pennsylvania and Wyoming; the McClure and Toms Creek mine properties in Virginia; and the Nicholas mine property in West Virginia. It includes the company's natural gas holdings in Pennsylvania's Marcellus shale and its interest in a coal export terminal in Newport News, Va.
The Pennsylvania operations include the Cumberland mine near Waynesburg and 30 producing shale gas wells.
The deadline to submit competing offers is March 28. A judge would have to approve any final sale.
Alpha's filing said the company hopes to emerge from bankruptcy by the end of June.
Other U.S. coal operators that have filed for bankruptcy include St. Louis-based Arch Coal and Scott Depot, W.Va.-based Patriot Coal. Most of Patriot's operating assets were sold to Lexington, Ky.-based Blackhawk Mining LLC.