At the conclusion of this morning’s hearing into the Stalking-Horse Agreement between Blackjewel and Contura Energy, Judge Frank Volk approved the agreement and expects to sign the official order this afternoon.
“It makes good sense to approve the debtors’ motion that is up for consideration,” Volk said. “This appears to be the only path forward to get some of the going concern value out of these assets.”
Under the agreement, Contura agrees to purchase what is being commonly referred to as the Western/Pax Assets including the Belle Ayr and Eagle Butte mines in the Powder River Basin, as well as the Pax mine in West Virginia. It includes an $8.1 million purchase deposit plus $12.5 million in additional cash to, in effect, finance the sale process.
Other interested buyers now have until 5 p.m. July 31 to submit qualified bids on any portion or all of Blackjewel’s collective assets. Those bids must include a good faith deposit, same or better terms, commitment letters, and scope of bid.
“It’s very difficult to assess what the painting is going to look like while it’s in process,” Volk said during today’s hearing. “And it’s an easy matter to say that there has not been enough time to allow all interested parties in the case to assess fairly what is going to happen because there are so many unknowns at this point.”
Blackjewel officially filed for chapter 11 bankruptcy protection July 1. Legal counsel for the company has called this process the only shot at avoiding conversion to chapter 7.