Appalachia West: Vulture Capitalists Descend On WY Mines, Squeezing Out Last Dollars, Workers
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Last Monday, the country’s sixth-largest coal producer, the mining company Blackjewel LLC (and its parent company Revelation Energy), struggling with mounting debts and unanticipated expenses, declared Chapter 11 bankruptcy. Immediately thereafter, it was denied an emergency line of credit by a bank and abruptly shut down its Eagle Butte and Belle Ayr mines. Around 600 Wyoming miners were left out of work, with no advance warning, and the mines were left unstaffed. Robert Godby, an energy economist at the University of Wyoming, described it as “a heart attack in the Powder River Basin.” Eagle Butte and Belle Ayr are the fourth and sixth top-producing mines in the US; Belle Ayr, just south of Gillette, Wyoming, was the first big mine to open in the PRB, back in 1972.
In some cases, the miners’ final paychecks, cashier’s checks flown in at the last minute, were held by banks or failed to clear. Local unemployment centers were almost immediately overwhelmed and reportedly ran out of materials on retraining within 24 hours. (Blackjewel paychecks are reportedly bouncing in Kentucky as well.)
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On Wednesday, a West Virginia bankruptcy judge denied a $20 million refinancing plan, but approved $5 million in emergency funding, not to reopen the mines but to monitor them for safety purposes. One condition of the loan was that Blackjewel CEO Jeff Hoops resign, that all members of his family resign, and that none of them be allowed access to any Blackjewel business or bank accounts. (More on Hoops later.)
For now, the restructured company is desperately seeking financing. If it does not succeed, it may be forced into Chapter 7 bankruptcy (liquidation), at which point it, or its creditors, would be forced to sell the mines. If they don’t find a buyer, the mines could be shut down for good, at which point environmental reclamation would begin. Some 1,700 jobs are on the line across the company.
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https://www.vox.com/energy-and-environment/2019/7/9/20684815/coal-wyoming-bankruptcy-blackjewel-appalachia
