It’s been a turbulent week for Blackjewel LLC that included filing for Chapter 11 bankruptcy reorganization, shutting down its U.S. coal mines and locking out about 1,700 employees, bouncing hundreds of paychecks and a forced resignation of the company’s president and CEO.
Despite the upheaval, Blackjewel’s new reorganization team says it’s “fully committed” to securing emergency financing to reopen the mines, including the company’s flagship Eagle Butte and Belle Ayr mines in Campbell County.
Blackjewel attorneys said during a weekend hearing in U.S. Bankruptcy Court for the Southern District of West Virginia that the company expects to present a new financing package to the court this week. If approved by Judge Frank W. Volk, that could mean bringing back the 580 workers locked out at the Wyoming mines and about 1,100 others at Blackjewel operations in Kentucky, Virginia and West Virginia.
About 120 employees overall have already been called back to work since Wednesday, when Volk approved a $5 million loan to provide security and perform other necessary maintenance at the shuttered mines. While those workers have been paid any owed back wages, hundreds of others, mainly from the company’s eastern operations, haven’t been paid for time worked prior to the lockout and for bounced paychecks that were issued June 28 and dishonored after Blackjewel’s initial $20 million emergency financing was suddenly pulled July 1.
“We fully intend to pay our employees the amounts owed for work completed prior to the Chapter 11 filing (on July 1) as we bring our employees back to work,” the company said in a Monday statement to employees. “Securing the funds necessary to bring Blackjewel back to full profitable production remains the company’s top priority.”
At Monday’s hearing, Volk said that when Blackjewel reaches a financial deal to reopen and resume bankruptcy reorganization, he’ll convene an emergency hearing to get that in motion right away.
“We want to emphasize the urgency with which we are approaching this situation,” Blackjewel said in the statement. “Management — and everyone involved in Blackjewel’s Chapter 11 case — understands that every day that passes adds to the hardship you and your families are experiencing, and we are doing everything possible to get our employees back to work.”
Securing the financing to reopen the mines may not be enough for some of Blackjewel’s critical vendors, like Wyoming Machinery Co., which provides equipment, maintenance and parts at Eagle Butte and Belle Ayr mines.
At $5.9 million owed, Wyoming Machinery is one of Blackjewel’s larger unsecured creditors. It’s already asked the court to guarantee payment of money owed and that future bills under its contract with Blackjewel will be honored. Those services cost about $14,000 a month. If that can’t be guaranteed, Wyoming Machinery Co. is asking Volk to void its contract with Blackjewel.
The court hasn’t yet held a hearing on that motion.