The transaction, pending privately held Omega’s ability to secure third-party financing, will be comprised of cash, future royalty payments and the assumption of reclamation obligations.
Suncoke Chairman and Chief Executive Officer Fritz Henderson said the move was part of its strategy announced earlier this year to downsize its coal presence and that the sale of HKCC to Omega, a holding company for various coal mining operations, aligned with that plan.
“With their nearby coal mining activities and familiarity with our operations, Omega is a natural fit for this portion of our coal business,” he said. “We will continue to implement our coal mining business downsizing plans while simultaneously pursuing a sale of all or other portions of our remaining coal mining operations.”
HKCC has nearly 20 million tons of proven and probable coal reserves located on approximately 250 acres in Russell and Buchanan counties, Virginia. The operations were largely idled in 2013, and consist primarily of highwall and deep mine reserves consisting of both hi-vol A and hi-vol B metallurgical coals and thermal coal.
This sale also includes HKCC’s warehouse, two idled coal preparation plants and certain coal loadout facilities.
Assuming all financing and regulatory and closing conditions are met, the companies expect the deal will close in the first quarter of 2015.