The bankruptcy court for Edison Mission Energy and related companies on Aug. 21 issued two orders approving compromise deals for the company to get out of or modify coal transportation agreements.
Edison Mission Energy and Midwest Generation (MWG) on Aug. 6 filed with the bankruptcy court a settlement that allows the companies out of a coal barging agreement with American River Transportation Co. (ARTCO). The settlement agreement resolves certain issues related to 18 barges currently or formerly owned or leased by MWG.
MWG and parent Edison Mission Energy in December 2012 filed for Chapter 11 at the U.S. Bankruptcy Court for the Northern District of Illinois.
ARTCO had been moving coal and petroleum coke to the now-closed Crawford and Fisk stations. That fuel was typically shipped by rail to MWG’s Will County facility, where it was transferred from railcars, blended as necessary to meet station specifications, and loaded onto debtor-owned or leased open hopper river barges.
Under a 2008 transportation agreement, ARTCO transported these barges to the Crawford and Fisk facilities and maintained and kept the barges in good repair. The debtors’ operations have not utilized the barge fleet since the Crawford and Fisk facilities were shut down and decommissioned in September 2012.
The bankrupt companies had on Aug. 6 also asked the court to approve the rejection of certain riders related to the railcar lease arrangement between MWG and General Electric Railcar Services Corp. (GE Rail). MWG leases a fleet of railcars from multiple lessors, including GE Rail, to transport coal to its four operating coal-fired power plants in Illinois. The lease deal dates back to prior plant owner Commonwealth Edison. The riders specify the equipment, term, and pricing for groups of railcars subject to the overall terms of the lease.
The riders provide for the price and term for 1,007 railcars (which are sorted by rider in groups of approximately 100–450 railcars each). MWG determined that the terms of the riders were too “onerous.” MWG and GE Rail recently agreed upon new modified terms for the 1,007 railcars that are the subject of the riders. MWG concluded that it could reject the riders and enter into new terms (including pricing and duration) more favorable than the terms of the riders.