Coal giant Alpha Natural Resources files for bankruptcy

Alpha Natural Resources, Inc. announced Monday that it will file for chapter 11 bankruptcy protection.

The Bristol, Va.-based company, one of the largest coal producers in the country, is looking to cut into its $3 billion debt, The Wall Street Journal reported Monday. 

Alpha, which operates more than 50 coal mines and 20 preparation facilities in Appalachia, has secured up to $600 million in bankruptcy financing, officials told the paper, and the company will look to sell some of its best-producing mines or turn them over to creditors.

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In a statement, the company’s chairman and CEO Kevin S. Crutchfield said the chapter 11 filing is “the right strategy at the right time for the future of our business.”

“It will enable us to build on the significant steps we have taken over the past several years to restructure our debt and protect our operations,” Crutchfield said. “I am confident Alpha will emerge from this process as a stronger company, with a diversified resource base and better positioned for the future."

Alpha’s bankruptcy is only the latest to hit the beleaguered coal industry. Bloomberg reports that more than three-dozen coal companies have filed bankruptcy over the last three years alone. 

Alpha listed $10.1 billion in assets and debts of $7.1 billion in its filing, according to Bloomberg.

In a statement, Alpha blamed a handful of factors for the “unprecedented period of distress” for the industry, including cheap natural gas prices, a bloated coal market, low prices and increased government regulations that have encouraged electric utilities to move away from coal. 

The bankruptcy filing comes the same day the Obama administration finalizes its Clean Power Plan, a major Environmental Protection Agency rule that is designed to cut carbon emissions from power plants. The regulation is expected to hit coal especially hard. 

"The change and challenges the U.S. coal industry has experienced over the last several years are greater than any in the past three decades," Crutchfield said.

"There is, no doubt, more uncertainty ahead, but also transformational opportunity in the coal sector for those who make proactive, strategic decisions."