Walter Energy is in the process of selling its U.S. coal assets, while its Walter Energy Canada Holdings Inc. announced Jan. 15 that it has received approval from the Supreme Court of British Columbia to commence a sale and investment solicitation process for the company’s assets and to engage PJT Partners LP as Walter Energy Canada’s financial advisor.
Walter Energy is selling its main U.S. coal mining assets in Alabama to Coal Acquisition LLC, backed by some of its top creditors, in a sale process administered by the U.S. Bankruptcy Court for the Northern District of Alabama. An auction is coming up on Jan. 19 for some other U.S. assets, including coal mines in southern West Virginia and the Walter Coke operation in Alabama. The sale of the company’s Canadian assets is being pursued on a separate track.
PJT is soliciting offers to purchase some or all of the assets of, or make an investment in, Walter Energy Canada and certain of its affiliates and partnerships. The deadline for submission of non-binding letters of intent is 5:00 pm (EST) on March 18.
The company also announced that the Stay Period has been extended up to and including April 5 and that William E. Aziz has been appointed as Walter Energy Canada’s Chief Restructuring Officer.
Walter Energy Canada and certain of its affiliates and partnerships obtained creditor protection under the Companies’ Creditors Arrangement Act (Canada) (the “CCAA”) under an Initial Order granted on Dec. 7. This will facilitate, among other things, a marketing process for the Canadian assets and for its holdings in the United Kingdom, which consist of an anthracite coal mine held through a subsidiary company (“Walter United Kingdom”).
Obligations incurred after the filing date, including obligations to employees and key suppliers of goods and services, continue to be paid on an ongoing basis.
Walter Energy Canada and Walter United Kingdom were not part of the U.S. chapter 11 filing of Walter Energy on July 15, 2015.
Walter Energy Canada’s Canadian operations consist primarily of three coal mines and exploration properties in the Chetwynd and Tumbler Ridge areas of Northeast British Columbia. Walter Energy Canada also owns one coal mine in South Wales through its subsidiary Walter United Kingdom. All four mines are idled as a result of current market conditions.
- The Wolverine Mine in British Columbia is an open-pit metallurgical coal mine with a coal processing plant and a rail load-out facility capable of handling 2.0-2.5 million metric tons per year.
- The Brule Mine in British Columbia is an open pit metallurgical coal mine and produces a premium low volatile pulverized coal injection (PCI) product.
- The Willow Creek Mine in British Columbia is an open-pit metallurgical coal mine with a coal processing plant and a rail load-out facility capable of handling production from both the Brule and Willow Creek mines. The Willow Creek Mine produces both metallurgical coal and coal used for pulverized injection purposes. The coal reserves are comprised of an estimated one-third metallurgical coal and two-thirds low-volatile pulverized coal (PCI).
- The Aberpergwm Mine in South Wales is an underground development mine located near the town of Neath. The mine produces anthracite coal, which can be sold as a low-volatile PCI coal, and other products used for domestic purposes.