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Trinity Coal buys lifeline in bankruptcy

THE OWNER of Trinity Coal has paid $15 million to stop the bankruptcy auction process for the company's Appalachian coal mines.

Staff Reporter

According to papers filed in US Bankruptcy Court in Lexington, Kentucky, India-based energy conglomerate Essar Global made the payment to buy its subsidiary more time from a series of auction deadlines required by lenders.

The payment moves Trinity Coal's bankruptcy loan-repayment deadline to November 8.

According to NASDAQ, Trinity Coal officials said in earlier court papers that they were under pressure to close on a sale of the company's assets by the end of August.

Creditors Credit Agricole SA, ING Group NV and Natixis are seeking about $104.3 million in claims and have also filed an involuntary petition against Trinity’s Frasure Creek Mining.

Essar is reportedly pushing for Trinity Coal to keep its assets and get out of bankruptcy through a reorganization plan.

Essar Group, the Indian business group controlled by billionaire brothers Shashikant and Ravikant Ruia, acquired Trinity Coal in 2010 for $600 million.

At the time, West Virginia-headquartered Trinity was one of the top 10 US coal producers with 7 million tons per annum of coal production with plans to ramp up to 10Mtpa.

“Trinity Coal will be an excellent addition to our North American business, ensuring that we become an integrated player in the region,” Essay chief executive and billionaire Prashant Ruia said at the time.

“Access to Trinity’s vast coal reserves and the opportunity to work with a team of skilled personnel will take us closer to our vision of becoming one of the lowest cost steel producers in the world.”

Trinity’s Frasure Creek Coal has both surface and underground operations in Kentucky and West Virginia, including permits for four surface mines, three underground mines, haul roads, a conveyer and prospects.

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