No financial terms were released, though Patriot officials said it will file the asset purchase agreement signed with the buyer with the U.S. Bankruptcy Court.
The assets, which it said are made up of any of its assets and liabilities not already included in its recent sales agreement with Blackhawk Mining, include the Federal complex in the northern region of the state and the Corridor G complex south of Charleston. Also included are mining permits for water quality improvement and land reclamation efforts.
VCLF/ERP is assuming liabilities of more than $400 million, Patriot said, relating to Patriot’s workers’ compensation, state black lung and environmental obligations; additionally, the buyer will assume or replace the bonds on all supporting reclamation and related liabilities.
The transaction is subject to court approval and the company’s Chapter 11 plan, and the company said operations and customer shipments will continue uninterrupted.
Bob Bennett, Patriot president and CEO, said the deal enables it to move ahead in its bankruptcy process.
“In VCLF, we have found an experienced partner who will responsibly manage our remaining assets consistent with the highest environmental standards, and we believe this proposed transaction is in the best interest of Patriot and its stakeholders,” he said, noting that it expects a majority of Patriot’s workers to be offered work with Blackhawk or VCLF at the sealing of the respective deals.
“With VCLF and Blackhawk, Patriot has now entered into agreements to sell effectively the entirety of the company, and we will move expeditiously to close both transactions so that we can successfully emerge from bankruptcy within the coming months.”
VCLF CEO Tom Clarke called the acquisition a “landmark achievement” for his company.
“[It allows] us to increase Appalachian employment through the reclamation and reforestation of thousands of acres of land,” he said. “Continued mining at Federal will allow us to launch our ‘compliant fuel’ program, which bundles reforestation carbon credits with coal sales, effectively reducing carbon emissions, as required under the new emission standards.”
The new mine owner said it expects to maintain employment in West Virginia at the current 683 employee level, and also expand employment through an investment of up to $176 million in land reclamation, reforestation and water quality improvement.
