Credit Agricole SA, ING Groep NV and Natixis filed the involuntary bankruptcy case against Trinity, a central Appalachian coal producer, and other affiliates in the U.S. Bankruptcy Court for the Eastern District of Kentucky. The banks claimed they were owed more than $104 million and that Trinity had been in “a state of serious financial distress” since 2011 and had stopped paying its bills.
At one point earlier this year, Trinity pursued a sale of its coal assets that included the active Deep Water and related metallurgical mining complex in Fayette County, W.Va., as well as idled operations such as Falcon Resources and North Springs Resources in West Virginia and Prater Branch Resources, Little Elk Mining and Levisa Fork in eastern Kentucky.
Trinity owns coal reserves in Floyd, Knott, Breathitt, Perry and Magoffin counties in eastern Kentucky and Mingo, Fayette, McDowell, Boone and Wyoming counties in West Virginia.
In early fall, Essar/Trinity did an about-face, embracing a plan that would allow for the retention of the mining properties in return for Essar Global Fund’s agreement to repurchase the assets from the banks. The deal was approved in November by Judge Tracey Wise.
According to an attorney for Trinity’s unsecured creditors committee, only the Deep Water complex is currently operating and there are no immediate plans to reopen the idled mines.
Trinity posted a modest $181,000 profit in October, bankruptcy records show, after losing money since it went into bankruptcy. From the time the Chapter 11 petition was filed until October 31, the company lost $25.7 million.