{"id":2917,"date":"2016-05-14T15:23:02","date_gmt":"2016-05-14T15:23:02","guid":{"rendered":"http:\/\/minutes.machine.market\/?p=2917"},"modified":"2016-05-14T15:23:02","modified_gmt":"2016-05-14T15:23:02","slug":"environmentalist-reportedly-trying-to-buy-alpha-natural-resources-coal-mines","status":"publish","type":"post","link":"https:\/\/machine.market\/blog\/environmentalist-reportedly-trying-to-buy-alpha-natural-resources-coal-mines\/","title":{"rendered":"Environmentalist reportedly trying to buy Alpha Natural Resources’ coal mines"},"content":{"rendered":"
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Benjamin Storrow<\/a> reports a Virginia environmentalist is said to be a leading contender in the race to acquire Alpha Natural Resources<\/a>\u2019 coal mines out of bankruptcy, including the company\u2019s two facilities in the Powder River Basin.<\/p>\n<\/div>\n

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Tom Clarke, a health care executive, has emerged as perhaps one of the most intriguing and talked-about figures in the coal industry in the last year. Through his nonprofit, the Virginia Conservation Legacy Fund<\/a>, Clarke has snapped up mines out of bankruptcy from Patriot Coal Corp. and Walter Energy.<\/p>\n<\/div>\n

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His plan is a novel one: Sell coal at a premium, use the proceeds to plant trees as an offset to power plants\u2019 carbon emissions and reclaim marginal mines.<\/p>\n<\/div>\n

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But until recently Clarke\u2019s moves have largely centered around eastern mining operations. Now, it appears he may be attempting to expand westward.<\/p>\n<\/div>\n

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SNL Financial, a trade publication, reported<\/a> Thursday that Clarke had submitted a $2.8 billion bid for all of Alpha\u2019s assets.<\/p>\n<\/div>\n

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Bids are confidential under the bankruptcy process. Clarke did not respond to multiple requests for comment. An Alpha spokesman said the company could not comment on the accuracy of SNL\u2019s report.<\/p>\n<\/div>\n

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Alpha\u2019s properties go to auction on Monday. The company submitted a restructuring plan to divvy up its properties.<\/p>\n<\/div>\n

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Core assets, comprising the Belle Ayr and Eagle Butte mines as well as several eastern properties, will be auctioned off. A group of Alpha\u2019s senior creditors had submitted a $500 million stalking horse bid, which essentially acts as a minimum bid for the Virginia-based firm\u2019s assets.<\/p>\n<\/div>\n

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A second company, centered around Alpha\u2019s marginal properties in Appalachia, would emerge from bankruptcy and focus on reclamation.<\/p>\n<\/div>\n

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The Virginia Conservation Legacy Fund\u2019s bid includes a $400 million cash payment, $250 million in new capital and the assumption of Alpha\u2019s reclamation liability, SNL reported.<\/p>\n<\/div>\n

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Blackhawk Mining LLC submitted a bid for $1 plus the assumption of Alpha\u2019s reclamation liabilities at several Appalachian properties. Quest Energy Inc. was said to have made a similar proposal, the trade publication said.<\/p>\n<\/div>\n

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Clarke\u2019s potential entry into Alpha\u2019s bankruptcy confounded environmentalists and industry analysts alike, and had both abuzz Friday.<\/p>\n<\/div>\n

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\u00a0\u201cIt doesn\u2019t make sense,\u201d said Bob Burnham, president of Burnham Coal LLC, a consulting firm.<\/div>\n<\/div>\n<\/div>\n
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Environmentalists have treated Clarke warily. Reclamation has emerged as a major issue in recent times, with questions about companies\u2019 ability to cleanup their mines increasing as their financial fortunes plummeted.<\/p>\n<\/div>\n

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Alpha has $411 million in unsecured cleanup costs in Wyoming alone.<\/p>\n<\/div>\n

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But some said it is not entirely clear how Clarke will pay for cleanup. In the case of Patriot, Clarke agreed<\/a> to assume $400 million in reclamation liabilities. He has continued to operate the Federal Mining Complex in West Virginia to generate income for cleanup efforts, analysts and environmentalists said.<\/p>\n<\/div>\n

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\u201cI think the way he would describe it is he is selling coal from these mines to pay for the reclamation at the mines he has already shut down, with the expectation that he will shut down all the mining and complete reclamation,\u201d said Peter Morgan, a staff attorney at the Sierra Club who has spoken to Clarke about his plans. \u201cMy sense is he acquired a bunch of zombie mines and he started reclaiming them.\u201d<\/p>\n<\/div>\n

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Of how Clarke will pay for reclaiming Alpha\u2019s mines, he added, \u201cIt\u2019s one of the biggest questions I have.\u201d<\/p>\n<\/div>\n

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All agreed that the acquisition of Alpha\u2019s Wyoming mines would represent a shift for Clarke. Belle Ayr and Eagle Butte are low BTU mines and have, among their Powder River Basin peers, borne the brunt of utilities\u2019 shift toward natural gas.<\/p>\n<\/div>\n

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Yet both mines are likely to remain in production regardless of how coal demand evolves, said Jim Thompson, an industry analyst at the consulting firm IHS Energy.\u201d<\/p>\n<\/div>\n

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\u201cOther properties that Clarke has acquired or rumored to be interested in acquiring are more reliant on different and meaningfully better market conditions,\u201d Thompson said.<\/p>\n<\/div>\n

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How Clarke might operate the Wyoming mines is unclear. Environmentalists and analysts alike speculated that they could be used to generate income for reclamation in Appalachia, or shut down entirely.<\/p>\n<\/div>\n

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Burnham voiced the most common sentiment heard Friday.<\/p>\n<\/div>\n

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\u201cI\u2019m not sure what they\u2019re doing,\u201d the coal consultant said.<\/p>\n<\/div>\n<\/div>\n

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Follow energy reporter Benjamin Storrow on Twitter @bstorrow<\/p>\n

Benjamin Storrow 307-335-5344, Benjamin.Storrow@trib.com<\/a><\/h4>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Benjamin Storrow reports a Virginia environmentalist is said to be a leading contender in the race to acquire Alpha Natural Resources\u2019 coal mines out of bankruptcy, including the company\u2019s two facilities in the Powder River Basin. Tom Clarke, a health care executive, has emerged as perhaps one of the most intriguing and talked-about figures in […]<\/p>\n","protected":false},"author":1,"featured_media":2918,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":""},"categories":[2,4,9],"tags":[247,1077],"yoast_head":"\nEnvironmentalist reportedly trying to buy Alpha Natural Resources' coal mines - MachineMarket Blog<\/title>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cranemarket.com\/blog\/environmentalist-reportedly-trying-to-buy-alpha-natural-resources-coal-mines\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Environmentalist reportedly trying to buy Alpha Natural Resources' coal mines - MachineMarket Blog\" \/>\n<meta property=\"og:description\" content=\"Benjamin Storrow reports a Virginia environmentalist is said to be a leading contender in the race to acquire Alpha Natural Resources\u2019 coal mines out of bankruptcy, including the company\u2019s two facilities in the Powder River Basin. 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