BRISTOL, Tenn., Nov. 12, 2020 /PRNewswire/ -- Contura Energy,
Inc. (NYSE: CTRA), a leading U.S. supplier of metallurgical
products for the steel-making industry, today announced a
definitive agreement with Iron Senergy Holding, LLC (Iron Senergy)
for the divestment of Contura's Pennsylvania operations, including the
Cumberland Mine in Greene County,
Pennsylvania. The equity transaction is expected to close
before December 31, 2020, and, upon
closing, will transfer to Iron Senergy the subsidiaries that hold
Contura's Cumberland and
Emerald mines and the associated
coal reserves, mining permits and operations, infrastructure,
equipment and transloading facilities.
The purchaser, Iron Senergy, has expressed its intention to
continue operating the Cumberland Mine past Contura's previously
announced planned exit at the end of 2022, thereby extending
employment opportunities for the Cumberland workforce, providing a continued
tax base for the local community, and sustaining business
opportunities for Cumberland's
vendors and a reliable fuel supply for customers. Iron Senergy's
plan also includes the development and integration of renewable
energy in efforts to further develop synergistic opportunities with
regional utilities.
"In addition to the important benefits to Cumberland employees and the local community
in Greene County, the signing of
this agreement to divest Cumberland provides a way for both Contura and
Iron Senergy to advance our respective strategic goals," said
David Stetson, Contura's chairman
and chief executive officer. "This transaction allows Contura to
nearly complete our move to a pure-play metallurgical company
providing critical feedstock for steel production. Additionally,
closing the transaction will meaningfully reduce our asset
retirement obligations and collateralization requirements, allowing
us to better focus our resources on the core mines in our portfolio
and our strategy as solely a met producer."
According to the terms of the transaction, Iron Senergy will
acquire all of the equity of the following wholly-owned Contura
subsidiaries upon closing: Emerald Contura, LLC; Cumberland
Contura, LLC; Contura Coal Resources, LLC; Contura Pennsylvania
Land, LLC; and Contura Pennsylvania Terminal, LLC (together, the
Pennsylvania Entities). Upon closing, Iron Senergy will post
replacement reclamation bonds for the Pennsylvania Entities and
assume their UMWA collective bargaining agreements. Also, upon
closing, Contura will provide $20
million in cash consideration to Iron Senergy and will
transfer $30 million in existing cash
collateral to Iron Senergy's surety provider as collateral for Iron
Senergy's replacement reclamation bonds.
Iron Senergy will assume all reclamation obligations associated
with the Pennsylvania Entities, estimated to be approximately
$169 million of undiscounted future
cash outflows, which will release Contura from these obligations
upon closing of the transaction.
The transaction is subject to a number of conditions to closing,
and therefore, there can be no assurances that closing will occur
when anticipated, or at all. The parties are working diligently to
address all of these conditions.
ABOUT CONTURA ENERGY
Contura Energy (NYSE: CTRA) is a Tennessee-based coal supplier with affiliate
mining operations across major coal basins in Pennsylvania, Virginia and West
Virginia. With customers across the globe, high-quality
reserves and significant port capacity, Contura Energy reliably
supplies metallurgical coal to produce steel. For more information,
visit www.conturaenergy.com.
FORWARD-LOOKING STATEMENTS
This news release includes forward-looking
statements. These forward-looking statements are based on
Contura's expectations and beliefs concerning future events and
involve risks and uncertainties that may cause actual results to
differ materially from current expectations. These factors are
difficult to predict accurately and may be beyond Contura's
control. Forward-looking statements in this news release or
elsewhere speak only as of the date made. New uncertainties
and risks arise from time to time, and it is impossible for Contura
to predict these events or how they may affect Contura. Except
as required by law, Contura has no duty to, and does not intend to,
update or revise the forward-looking statements in this news
release or elsewhere after the date this release is issued. In
light of these risks and uncertainties, investors should keep in
mind that results, events or developments discussed in any
forward-looking statement made in this news release may not
occur.
INVESTOR
CONTACT
investorrelations@conturaenergy.com
Alex Rotonen, CFA
423.956.6882
MEDIA
CONTACT
corporatecommunications@conturaenergy.com
Emily O'Quinn
423.573.0369
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SOURCE Contura Energy, Inc.