The Blackhawk transaction is subject to court approval and confirmation of Patriot’s proposed plan of reorganisation.
The confirmation hearing is set for October 5.
Coronado Coal, which also submitted a qualified bid and took part in the auction was designated backup bidder should the Blackhawk transaction fall through.
The decision comes after a competitive auction process was held.
Blackhawk had long been in the frame to pick up the assets, although reports emerged last week that Patriot had been talking to a “rival bidder”.
Patriot president and CEO Bob Bennett said the auction process had been robust and competitive.
“We are pleased with the results of the auction and believe that the proposed transaction with Blackhawk is in the best interest of Patriot, and its employees and stakeholders.”
This is Patriot’s second stint in Chapter 11.