The company will also enter into a new long-term coal supply agreement with Public Service of New Mexico and the other owners of the San Juan Generating Station.
Westmoreland CEO Keith Alessi said: "Today’s action by the board of directors completes the final steps towards entering into the definitive purchase agreement on July 1, 2015, which coincides with finalizing our binding coal supply agreement with PNM, which will be filed with the New Mexico Public Regulation Commission by July 1.
"While we understand the importance and complexity of the decision, Westmorland hopes that the Public Regulation Commission will approve PNM’s plan for SJGS so that we can move towards closing and begin our partnership with PNM in an expedient manner. As a company, we are committed to the communities we represent and, in this situation, helping to maintain the viability of the Farmington economy through the operation of the San Juan Mine."
The acquisition, which is expected to close on December 31, 2015, contemplates a coal supply agreement through June 30, 2022.
Westmoreland intends to operate the San Juan Mine through the termination of the coal supply agreement and is hopeful an extension of the coal supply agreement can be reached that will extend the life of the mine far past the 2022 time frame.
