The U.S. coal baron and avid Donald Trump donor who begged his influential friend for an industry bailout, after suing TV comedian John Oliver for calling him a “geriatric Dr. Evil”, has been given until October 14 to cover his company’s outstanding debt to its creditors.
St. Clairsville, Ohio-based Murray Energy Corporation “failed to make multiple payments to lenders this week,” Bloomberg reports, citing a company statement last Wednesday. Creditors postponed legal action until mid-month, “buying Murray some time to figure out how to shore up its balance sheet.”
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Murray “is struggling to stay afloat, along with the rest of America’s coal companies, as cheap natural gas and renewable energy resources cut into coal’s share of the U.S. power market,” Bloomberg adds. “At least four companies, including Cloud Peak Energy Inc. and Blackjewel LLC, have gone bankrupt this year, laying bare the decline of a fuel that once accounted for more than half of all U.S. power generation. Today it’s less than 25%.”
Last month, the company shut down some of its coal mines in West Virginia, citing “severely depressed coal markets”. Now, “you can’t make payments out of thin air if the money isn’t in the bank,” said B Riley FBR Inc. coal analyst Lucas Pipes.
“Murray’s potential default comes more than a year after the Trump administration’s efforts to subsidize struggling nuclear and coal-fired power plants—particularly ones that Murray supplies—failed, shot down by President Donald Trump’s own appointed energy regulators,” Bloomberg recalls. “Chief Executive Officer Bob Murray, an early Trump supporter and a big donor to his campaign, was instrumental in setting his energy agenda and has hosted multiple fundraisers for him.”
In other U.S. coal bankruptcy news, Bloomberg says Foresight Energy LP “failed to make its own interest payment” last Tuesday, invoked a 30-day grace period to evaluate its options, and saw its share price fall 26% as a result. Murray holds a controlling interest in Foresight, which hasn’t turned a profit since 2014.