Murray Energy Corp. will continue to operate Armstrong Energy Inc. coal mines in western Kentucky's Muhlenberg and Ohio counties but will lay off some employees, according to a letter Murray sent to Armstrong personnel.
Murray is set to acquire a majority interest in a new company that will hold certain assets of Armstrong, which filed for Chapter 11 bankruptcy reorganization in 2017, including the Kentucky mines.
The Messenger, a newspaper serving Hopkins County, Ky., reported that Murray sent a letter to Armstrong staff dated Jan. 24 that said it intended to hire "a substantial portion of the Armstrong workforce" and will extend job offers Feb. 9 to the workers who will be retained.
Murray Energy did not respond to a request for comment on the letter.
CEO Robert Murray, who gave the opening speech at the 2018 Coaltrans conference Feb. 1, told S&P Global Market Intelligence afterward that he expects the Kentucky mines to produce 3.5 million tons of coal this year and plans to export about 2 million tons through Gulf Coast ports where Murray Energy has existing export options.
Murray Energy entered into a legally binding transaction agreement with Armstrong Energy and certain senior secured noteholders to acquire a 51% ownership interest in a new company that will own the assets formerly owned by Armstrong while the noteholders will hold a 49% ownership interest in the company. The transaction must still be approved by the U.S. Bankruptcy Court for the Eastern District of Missouri, which is administering Armstrong's bankruptcy case.
