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ARTICLE · 15 FEBRUARY 2016

Distressed Coal—Will The Cycle Ever Turn?

Arnold & Porter
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Arnold & Porter

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In addition to the employee and retiree obligations and regulations that need to be considered when dealing with the restructuring of any corporation, coal mining companies are subject to additional healthcare obligations...

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Unprecedented Challenges for the Coal Industry

As evidenced by the recent spate of coal mining companies filing for bankruptcy protection (e.g., Alpha Natural Resources Inc., Patriot Coal, Walter Energy Inc., James River Coal Co., Trinity Coal Corp., Americas Energy Co., Clearwater Resources LP and Consolidated Energy), the coal mining industry is facing a period of historic stress. Although coal's preeminence as a fuel source has been declining for more than 150 years, a confluence of recent factors has contributed to a likely unprecedented level of difficulty in this industry. These factors include: (i) increasing competition from energy sources that can be used as an alternative to coal;1 (ii) implementation of new environmental regulations;2 (iii) decreasing global demand for coal caused, in part, by the economic slowdown in China;3 (iv) decreasing institutional investment in the coal industry due to

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