May 9, 2016

Bankrupt Miner Arch Coal Files Restructuring Plan

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Arch Coal has filed its initial plan for how it hopes to emerge from bankruptcy, but doesn’t contain many details when it comes to reclamation and worker benefits.

Arch_Coal_LogoArch Coal filed for Chapter 11 in January, in the hopes of shedding some of its $4.5 billion in debt. The company’s restructuring plan outlines how various creditors would be paid—or not paid—if the plan is approved.

But the court documents don’t provide many details about what will happen with the company’s nearly half a billion dollars in outstanding reclamation obligations in Wyoming.

Before declaring bankruptcy, Arch was allowed to self-bond its reclamation, meaning that it didn’t actually have to put up cash or a third-party assurance to guarantee it.

The company said in its filing that if it is required to supply additional guarantees when it emerges from bankruptcy, that it would affect the company’s ability to stay solvent.

The Wyoming Department of Environmental Quality refused to comment on whether Arch will be required to replace its self-bonds.

The filing also glossed over worker benefits. While it contains no specific provisions to pare them back, the document says the company reserve the right do so in the future. There will be a hearing on the proposed plan June 9.