Cloud Peak Energy Corp. has accepted a bid from Navajo Transitional Energy Co. to buy “substantially all of Cloud Peak Energy’s assets.”
The Gillette News Record reported that Cloud Peak Energy, one of the largest coal mine operators in Wyoming’s Powder River Basin, announced the sale On Aug. 16. It will be considered for approval by the U.S. Bankruptcy Court.
Navajo Transitional Energy has agreed to buy the company’s Antelope and Cordero Rojo mines in Campbell County, WY, along with the Spring Creek Mine in southern Montana, according to a Cloud Peak statement announcing the winning bidder. Navajo also will own the Sequatchie Valley reclamation project.
Navajo has agreed to pay a cash deposit of $15.7 million when the sale closes and assume a $40 million second lien promissory note and five-year royalty on future tons of coal produced at the PRB mines. Navajo also will pay up to $20 million in post-petition debts accrued during the bankruptcy process.
The company also has agreed to assume pre- and post-petition federal, state and local tax liabilities for the company, make state and federal royalty payments and assume all reclamation obligations.
That’s good news for Campbell County, which is owed an $8.3 million production tax payment that was due just hours after Cloud Peak filed for Chapter 11 bankruptcy reorganization on May 10.
“I am excited they’re doing right by agreeing to pay the taxes and we’ll look forward to hopefully seeing (Navajo Transitional Energy) in Gillette and get familiar with their management,” said Campbell County Commissioner Mark Christensen.
He also said that the company has bid on all of Cloud Peak’s operational mines is a good sign it plans to continue mining coal in the Powder River Basin, which is good news for the nearly 1,200 workers at the three operations.
“Right now on this day, I’m just happy there was a bidder wanting to keep these going and pay the tax,” he said. “It looks to me like they want to be a good neighbor and I think that’s all really exciting. … this is really the best possible option we could have had.”
It’s also the result of a successful bid and auction process said Cloud Peak President and CEO Colin Marshall in statement announcing the successful bid.
“We are pleased to announce the conclusion of our robust and competitive marketing process,” he said. “We have achieved an outcome that we believe supports the interests of all our stakeholders.”
Marshall also said the mines will “continue to operate as normal” during the sale transition.
Based in Farmington, New Mexico, Navajo Transitional Energy Co. owns the Navajo Mine in the Four Corners area and is organized under the Navajo Nation.
Source : me.smenet.org