A Pike County coal operator filed for bankruptcy protection last week.
According to court documents, Cambrian Holding Company, Inc., which operates several mine sites in Pike County, filed for Chapter 11 bankruptcy protection June 16. According to a statement issued by the company, the company “will explore a sale process under court supervision.
According to documents filed in U.S. District Court in Lexington, Cambrian Holding Company, which lists its headquarters as an address at Belcher near Elkhorn City, listed nearly $21 million in debt with its 20 largest creditors, including more than $2.4 million with Whayne Supply and nearly $1.2 million with American Electric Power. Buchanan Energy Company of Belfry, R.D. Adkins Trucking of Elkhorn City, Appalachian Security of Pikeville and Community Trust Bank were also listed among Cambrian’s 20 largest creditors.
A report by S and P Global said Cambrian listed assets totaling between $10 million and $50 million and liabilities between $100 million and half a billion dollars.
The company received approval in federal bankruptcy court to continue paying employee wages and benefits, including health care costs.
Cambrian Holding Company is the blanket under which several mining operations operate. The statement issued by the company lists its primary operations as being Perry County Coal in Hazard, Premier Elkhorn Coal LLC at Myra and Clintwood Elkhorn Mining LLC, which has operations at Feds Creek and in Hurley, Virginia.
According to the state Energy and Environment Cabinet, Apex Energy also operates out of Pike County.
According to a report by legal industry newsletter Law360, Cambrian Holding Company President Mark Campbell, in federal bankruptcy filings, blamed falling coal prices nationwide and the company’s purchase of Teco Energy for its financial trouble. As part of the purchase of Teco, Cambrian agreed to pay workers compensation and black lung liabilities, which were self-insured by Teco, by way of a four-year payment plan of $60 million per year. The report said the payment was eventually lowered to $19 million per year, but Cambrian missed its first payment of $3 million and Teco sued Cambrian.
The extended downturn in the coal industry further hampered Cambrian’s ability to raise more revenue, the Law360 report said.
A statement by Campbell issued last week following the Chapter 11 filing said the company’s mines will continue to operate.
“Today’s announcement represents a significant step in our ongoing efforts to secure our company’s position,” Campbell said in the statement. “We will continue to provide our customers with exceptional service as we move through this process, while maintaining and further reinforcing our position in the industry with the highest standards for safety, environmental stewardship and productivity. This court-supervised process will also allow us to prepare our company for sale. Potential buyers for the business will have the opportunity to demonstrate their interest and provide the company with a path forward. We firmly believe this is the best course of action for our company.”
Calls seeking further comment and information to Cambrian and the law firm overseeing the bankruptcy filing were not successful as of presstime Monday.
In addition to Perry County Coal, Apex Energy, Premier Elkhorn and Clintwood Elkhorn, the other Cambrian affiliates affected by the bankruptcy filing included: Bear Branch Coal, CW Auger, Cambrian Coal, Gatliff Coal, Marshall Resources, Pike-Letcher Land, PLM Holding Company, Raven Rock Development, Ray Coal, Rich Mountain Coal, ST and T Leasing, Shelby Resources, TC Leasing and Whitaker Coal.