Murray Energy Plans Mass Layoffs and Considers Filing for Bankruptcy

by San Antonio Attorney

Murray Energy, known as one of the biggest private coal producer in America, recently announced that 4,400 jobs will be cut in several states.  The possibility of the company filing for bankruptcy is high in light with Obama’s clash with coal producers.

The coal produces plans to cut jobs in six states with bankruptcy filing being a option as well, citing the Obama Administration’s war on coal as a major factor of its current situation.

Robert Murray, CEO of Murray Energy, told the correspondents in FOX Business Network that the coal industry has been cut into half under Obama’s administration.

The spot price of coal is approximately $43 in Northern Appalachia, as stated by the U.S. Energy Information Administration.

Murray established the business in 1988 and has since then exerted a lot of effort to avoid drastic moves such as mass layoffs and Chapter 11 filings.  Murray added that the recent announcement served as a precaution to those connected to the company.

In 2013, Murray acquired Consol Energy mines including its transportation unit for the price of $3.5 billion.  However, it also took the employment obligations worth $1.8 billion to Ohio miners.

The overall expenses of Murray’s Energy can be cited by credit rating agencies such as Moody’s Investors Services and Standard’s & Poor’s.

Standard & Poor’s recently decreased the credit rating of Murray Energy and gave negative score.  The agency also predicted the Murray Energy’s liquidity will be pulled down from debt.

Moody’s Credit Rating Service also lowered Murray Energy’s rank to a lowest score prior to default in February.  The agency pointed out the company’s debt obligation and the impending negative outcome for the coal industry.

Moody’s representative added that Murray Energy encountered challenges in the mines of Northern Appalachia due to the competition of cheap natural gas taken from Marcellus Shale.

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