Patriot Coal Files for Chapter 11 Bankruptcy
A major coal company with mines in Appalachia and Western Kentucky has filed for bankruptcy. In a news release, Patriot Coal said it was undertaking the move to facilitate restructuring.
"The coal industry is undergoing a major transformation and Patriot's existing capital structure prevents it from making the necessary adjustments to achieve long-term success," said Patriot Chairman and Chief Executive Officer Irl F. Engelhardt. "Our objective is to use the reorganization process to address important issues in an orderly way and make the Company stronger and more competitive."
The company cited several factors affecting the coal industry as reasons financial restructuring is necessary, like low natural gas prices, environmental regulations and a weaker economy.
During recent months, the cancellation of customer contracts, lower thermal coal prices and rising expenditures for environmental and other liabilities have severely constrained the Company's liquidity and financial flexibility.
According to Patriot's website, the company has three mines in Union and Henderson counties.