National Coal received a portion of the purchase price in cash and the buyer assumed approximately $6.6m of accounts payable the company owed to an affiliate of Ranger Energy.
In addition, Ranger Energy leased a portion of the company’s coal reserves located on the New River Tract. The company also received from Ranger Energy the return of approximately $1.9m in cash that was previously pledged to secure reclamation bonds and other liabilities associated with the New River Tract operation.
The assets sold include the Baldwin preparation plant, the active underground mine number 5A, coal inventories located on the property, and the idled surface mine number 3, along with the associated permits and certain liabilities.
Additionally, the coal mineral rights on approximately 22,000 acres were leased to Ranger Energy for a royalty, which ranges from 6% to 8% of applicable revenues.
Daniel Roling, president and CEO of National Coal, said: “The Company used the majority of the proceeds from this transaction for payment on our outstanding accounts payable and equipment debt, and to pay the $4.5 million outstanding balance owed on the short-term credit facility.”
National Coal’s continuing operations in Tennessee include the coal mineral and mining rights to approximately 57,000 acres of land, along with mining complexes that include one active underground mine and one active surface mine.
