Blackjewel CEO out, court grants emergency financing
GILLETTE — Blackjewel LLC President and CEO Jeffrey Hoops Sr. will resign as a condition of a federal bankruptcy court’s order granting $5 million in emergency financing to pay for security and other maintenance at the company’s properties as it pursues a Chapter 11 reorganization.
The financing, which will come from Riverstone Credit Partners, will provide money to adequately secure shuttered Blackjewel coal mining operations, including the Eagle Butte and Belle Ayr mines in Campbell County. The mines were abruptly shut down and employees locked out Monday afternoon just hours after the Chapter 11 filing in U.S. Bankruptcy Court for the Southern District of West Virginia when $20 million in emergency financing to keep the mines operating fell through.
Another attempt to reopen the mines was dashed earlier Wednesday when Judge Frank. W. Volk denied a new financing plan that would have had Hoops provide the money himself, along with some other third-party financing.
While Blackjewel’s motion said that without that financing deal it would be forced to filed for a Chapter 7 bankruptcy liquidation instead of reorganization, the company hasn’t done that yet.
Along with giving the go-ahead to the $5 million, the judge also approved other first-day motions allowing Blackjewel to continue to pay employees, taxes, health benefit programs, Workers Compensation and other insurance premiums. But while the company is approved to pay those expenses that accrue in the normal course of business, without another financing option it doesn’t appear to have the means to do so.
The $5 million relief granted Wednesday afternoon is a "bridge" for the company to continue to pursue other funding options, the judge said. It can only be used to provide security or for essential personnel to fight any active fires at its mine sites, along with a maximum of $500,000 to pay professional fees.
As the company continues to navigate bankruptcy and its 1,700 employees — including 580 in Campbell County — the county, city of Gillette and Town of Wright put out a joint statement of support Wednesday afternoon for those locked-out workers.
Campbell County, the City of Gillette and the Town of Wright would like to express their great concern for those effected by the closures of Belle Ayr and Eagle Butte mines. This is a tumultuous time for Campbell County, but as we have seen in the past, we will emerge stronger. We have seen this community rally around our friends and neighbors before and we are already seeing it again.
The Commissioners, Mayors, and Councils have already been in close contact with state agencies, including Governor Gordon’s office, to ensure that every resource is available to our residents as soon as possible. The Department of Workforce Services has already scheduled workshops to explain the unemployment process, as well as expanding their hours in their Gillette office to provide better service. The Food Bank of the Rockies has also been alerted and plans are being made for them to render aid.
We will continue to work closely with the State of Wyoming to assist with addressing the immediate needs of affected families in our area. Stay Strong Gillette, Wright and Campbell County.