Colorado-based Westmoreland Coal Company has filed for Chapter 11 in a bankruptcy court in Houston. The company operates mines in Texas, Wyoming, Montana, New Mexico, North Dakota, Ohio, and a coal-fired power plant in North Carolina.
Westmoreland is over $1.4 billion in debt and $770.46 million in assets according to the filing on October 9.
Westmoreland interim CEO Michael Hutchingson said, “Our goal is to emerge as a stronger Westmoreland, better positioned to grow and thrive.”
Chapter 11 bankruptcy will allow Westmoreland to restructure its debts and negotiate with creditors while keeping the business operational. In the restructuring agreement, a group of lenders will bid for significant amounts of Westmoreland’s business assets.
Bargaining with Employees
Westmoreland is also asking for concessions from its union employees and retirees. The bargaining agreements concern about 900 employees out of the 1,732 total employees. While additional documents disclose that within the last 12 months, Westmoreland paid eight of its former and current executives more than $10.2 million in bonuses, salary, and severance.
United Mine Workers Association International, President Cecil Roberts said: “Once again, we find corporate executives looting coal companies and driving them into bankruptcy while setting up workers to take the brunt of the fall.”
Phasing out Coal
Westmoreland is one of 4 major coal companies to file for bankruptcy within the last three years. With the advent of cheaper natural gas, the demand for coal has dropped considerably. Some states are planning to reduce or eliminate coal to clean up the air. China and India, two major coal consumers, have canceled coal projects in an attempt to reduce air pollution.
If your company files for bankruptcy and you find yourself unable to keep up with your bills, consider contacting a Houston Bankruptcy Attorney to find out what options you may have.