Blackjewel LLC President and CEO Jeff Hoops is offering to front the money to keep his bankrupt coal mining operations running if his money is secured as senior priority to be paid back during Chapter 11 bankruptcy proceedings.
It’s a last-ditch attempt to salvage the company’s Chapter 11 filing after being denied a $20 million credit line to keep its coal mining operations running, including the Belle Ayr and Eagle Butte mines in Campbell County, which combined to produced about 35.5 million tons of coal in 2018.
Without immediate court approval, Blackjewel may “have no choice but to convert these cases to Chapter 7,” says a motion filed Tuesday afternoon with the U.S. Bankruptcy Court for the Southern District of West Virginia.
Instead of a reorganization, Chapter 7 is a straight liquidation of the business.
“If that occurs, untold amounts of value of (Blackjewel’s) assets and estates will be destroyed and more than 1,700 people will be out of work,” the motion says. “It is imperative that the revised financing proposal be heard today, if at all possible, if the Debtors are to continue as a going concern.”
The court will consider the motion for an expedited hearing at 2:30 p.m. and if it grants the hearing, it will be held immediately after.
The motion comes a day removed from Blackjewel LLC first filing for Chapter 11 bankruptcy protection, then hours later abruptly shutting down operations and locking out its mines when emergency funding was unavailable.
That immediately put 580 Campbell County coal mine workers out of jobs, 304 at Eagle Butte and 276 at Belle Ayr, according to the latest filings with the U.S. Mine Safety and Health Administration.
UPDATE: As of 3:20 p.m., the court in West Virginia confirmed a Blackjewel hearing was still going on. Because it's after business hours, there's no indication whether the results of the hearing will be posted today.
UPDATE: As of 4:50 p.m., the court in West Virginia has closed for the day, but it's unknown if the hearing is still going on. No additional information about the emergency financing has been posted.
This is a developing story and will be updated as more information is available.