The companies entered their intentions in the United States Bankruptcy Court for the Northern District of Alabama. During this time, officials for the trio said they will continue to operate their businesses and continue customer shipments uninterrupted; additionally, all will continue to honor landowner obligations and keep paying employees.
The challenges of the U.S. coal markets and lower natural gas prices were both cited for the decision.
“This environment has created an extremely challenging financing environment as the company attempted to refinance its existing debt obligations,” stated Jos De Smedt, CanAm CEO.
“Additionally, weakness in the local thermal coal market in the fourth quarter of 2014 and the first quarter of 2015, combined with a cold and extremely wet winter that impacted the mining and shipment of coal, has continued to erode CanAm’s cash position.”
CanAm officials said that the Chapter 11 process will be used to restructure itself financially and to build a strong foundation for its future.
“After careful consideration of all available alternatives, the boards of the respective companies determined that a Chapter 11 filing was a necessary and prudent step and the best way to maintain regular operations and allow for a successful restructuring,” CanAm, BCC and CCR President Robert Lewis added.