NEW YORK Bankrupt
metallurgical coal producer Patriot Coal Corp. has reached a
proposed settlement to phase out and eventually stop all
large-scale mountaintop mining in the central Appalachia region
in West Virginia, the St. Louis-based miner said.
The agreement is part of a deal
reached with three environmental groupsthe Ohio Valley
Environmental Coalition, the West Virginia Highlands
Conservancy and the Sierra Clubthat sued the company
under the Clean Water Act relating to surface mining activities
from its West Virginia coal mine operations.
Under the terms of the proposed
deal, the deadlines for a number of the companys
compliance schedules have been extended, it said.
"This settlement agreement
allows Patriot to defer up to $27 million of compliance-related
cash outlays from 2012 and 2013 into 2014 and beyond, which
improves our liquidity as we reorganize our company and
increases the likelihood that we will emerge from the Chapter
11 process as a viable business," Patriot president and chief
executive officer Bennett Hatfield said in a statement.
"Importantly, this proposed
settlement allows Patriot to continue mining according to
existing permits and is consistent with our long-term business
plan to focus capital on expanding higher-margin metallurgical
coal production and limiting thermal coal investments to
selective opportunities where geologic and regulatory risks are
minimized," he added.
The settlement must be approved
by both the federal district court in southern West Virginia
following a public comment period and the bankruptcy court in
southern New York, where the company filed for Chapter 11
bankruptcy protection in July (
amm.com, July 10), the miner said.
A version of this article was
first published by AMM sister publication Steel First.