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GILLETTE, Wyo. – The third largest coal company in the country in terms of production volume filed for bankruptcy on Friday, as utilities increasingly turn to gas-fired generation and renewable energy for electricity generation.
Cloud Peak Energy, a Gillette-based company, has requested the reorganization of Chapter 11 in the US Bankruptcy Court of Delaware. This decision was widely expected since at least March, when the company received the first of several extensions extending a $ 1.8 million loan. The last extension expired Friday.
Cloud Peak owns and operates three mines in the Powder River Basin: the Antelope and Cordero Rojo Mines in Wyoming and the Spring Creek Mine in Montana.
The mines shipped 50 million tonnes of coal in 2018. They will remain in business during the bankruptcy process with $ 35 million in debt financing, according to the company.
"As we begin this process, Cloud Peak Energy remains a reliable source of high quality coal for customers," said President and CEO Colin Marshall in a statement.
Cloud Peak is the fourth largest coal producer in Wyoming, the first mining state to go bankrupt in recent years. Alpha Natural Resources, based in Bristol, Tenn., Filed for bankruptcy in 2015, followed by leading producers Peabody Energy and Arch Coal in 2016. Westmoreland Coal filed for bankruptcy in October.
Inexpensive and less polluting natural gas and cheaper wind and solar energy have become attractive alternatives to coal in the United States. None of the huge open pit coal mines in the Powder River Basin have been closed. But the outlook for thermal coal, the type used for power plants, is bleak.
A federal government report released Thursday predicts that coal in the coming months will account for 25 percent of US electricity generation, a decline of nearly half in the last decade. The trend continues despite President Donald Trump's efforts to move away from a wide range of environmental regulations affecting coal.
Wyoming officials have meanwhile sought to encourage carbon capture technology by funding research at a plant in the Gillette area. All marketable results of this work remain years of widespread use.
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Follow Mead Gruver at https://twitter.com/meadgruver.
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