Nearly a year after filing, Peabody Coal has emerged from bankruptcy by reducing its debt by$5 billion and by providing third party bonding for mine restoration. That’s according to a company press release this week.
Rob Godby, director at the Center for Energy Economics and Public Policy, said the key was a reduction in the company's costs in Australia. According to Godby, Peabody sank a lot of debt into expanding its market there, but that was only one reason they went bankrupt.
“There’s a lot of competition in the market,” Godby said. “Natural gas is still relatively low priced. Renewables are an ongoing challenge, and they’re cost competitive. Many people don’t realize that the cheapest type of new generation facility that a utility, for example, could build is a wind power plant.”
Peabody owns the North Antelope Rochelle mine in the Powder River Basin, the largest coal mine in the United States. The company laid off almost 15 percent of its workforce last spring just before going bankrupt. Godby said the coal market has finally hit bottom and has been rebounding in recent months, but he said he’s not sure coal’s dominance in the market is likely to come back anytime soon.
