Coal miner Peabody emerging from bankruptcy

AP News
Posted: Apr 03, 2017 7:03 PM

ST. LOUIS (AP) — The nation's largest coal producer, Peabody Energy Corp., said Monday that it has emerged from bankruptcy protection after a year.

The St. Louis company said it reduced costs and slashed its debt load by more than $5 billion in the past year.

CEO Glenn Kellow said that the company has the size and assets — including a wide geographic reach — to be competitive. Peabody will aim to further reduce debt and return cash to shareholders, he said.

Demand for coal has weakened as utilities switch to cheaper natural gas for electricity generation. The downturn has led to thousands of job losses and devastated mining communities.

Nationwide, about 60,000 coal-mining jobs, or more than 40 percent, have disappeared since 2011. U.S. coal production last year hit its lowest level since 1978. In mining towns, many people blame regulations enacted by former President Barack Obama aimed at curbing climate change.

President Donald Trump vowed during the campaign to bring back mining jobs, and last month he signed an executive order aimed at reducing regulations on coal.

On Monday, Trump's Interior Department said it will scrap a regulation designed to ensure that coal companies don't shortchange the government on royalties for coal extracted from public land, mostly in the West. Mining companies had sued to block the rule.

Experts question whether rolling back regulations can restore jobs to an industry that has lost favor in the marketplace.

Jason Bordoff, a Columbia University professor and former adviser to Obama on energy and climate change, said at best Trump's actions might slow the decline of coal, which he said are more closely related to lower prices for natural gas, lower costs for renewable energy, and weaker coal demand from Asia.

Undoing Obama-era rules, he said, "is not going to bring the coal industry back and not going to bring lots of coal jobs back."

Peabody, which traces its roots to 1833, filed for Chapter 11 protection in April 2016, and followed other big bankruptcies in the industry including Arch Coal, Alpha Natural Resources, Patriot Coal and Walter Energy.

Peabody's old shares were extinguished with no value on Monday. New shares will begin trading Tuesday on the New York Stock Exchange.