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Murray Energy Faces Default of Bankruptcy

Coal News - Published on Mon, 07 Oct 2019

Image Source: bloomberg.com
US coal giant Murray Energy failed to make multiple payments to lenders last week. Creditors have agreed not to take legal action until October 14, buying Murray some time to figure out how to shore up its balance sheet, the St. Clairsville.

Murray Energy is struggling to stay afloat, along with the rest of America’s coal miners, as cheap natural gas and renewable energy resources cut into coal’s share of the US power market. At least four miners including Cloud Peak Energy and Blackjewel have gone bankrupt this year, laying bare the decline of a fuel that once accounted for more than half of all US power generation. Today it’s less than 25%.

Lucas Pipes, a coal analyst with B Riley FBR, said that prices for thermal coal the kind burned by power plants – have slumped, which may have left Murray short on cash. You can’t make payments out of thin air if the money isn’t in the bank.

Murray’s potential default comes more than a year after the Trump administration’s efforts to subsidize struggling nuclear and coal-fired power plants particularly ones that Murray supplies failed, shot down by President Donald Trump’s own appointed energy regulators. Murray CEO Mr Bob Murray, an early Trump supporter and a big donor to his campaign, was instrumental in setting his energy agenda and has hosted multiple fundraisers for him.

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Posted By : Rabi Wangkhem on Mon, 07 Oct 2019
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