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Naughton Power Plant

Coal is brought into PacifiCorp's Naughton Plant from the adjacent Westmoreland coal mine in 2014 in Kemmerer. Westmoreland Coal's CFO Gary Kohn has resigned.

The chief financial officer of bankrupt Westmoreland Coal Co. is resigning for personal reasons, the company announced Wednesday.

Gary Kohn received $1.2 million in incentive bonuses, in addition to his $472,000 salary, during the year leading up to Westmoreland’s bankruptcy filing. His resignation is effective in early January.

Westmoreland, which operates the Kemmerer coal mine in southern Wyoming, has come under fire for its bankruptcy plan, with objections from the Department of Justice, the utility PacifiCorp, creditors and current and retired coal miners. The company has also been criticized for a recent request of the bankruptcy court to dole out retention bonuses to certain employees.

Interim CEO Michael Hutchinson thanked Kohn for his leadership during the lead-up to bankruptcy in a statement Wednesday.

“Westmoreland remains well positioned to complete its restructuring proceedings in an expedient manner with a goal of emerging as a stronger, more stable business in the first quarter of 2019,” he said.

The bankruptcy has driven uncertainty into the small town of Kemmerer and threatened to strip the benefits of current and retired miners.

The United Mine Workers of America, the coal union that represents the Kemmerer miners, argued in court documents that, before the bankruptcy, the company began signaling that it would be forced to cut benefits for retirees due to its financial difficulties.

More than a dozen retired miners, included Wyoming pensioners who’d worked at the Kemmerer mine for decades, sent letters to the bankruptcy court in Houston pleading for their health benefits and pensions.

In its bankruptcy plan, which details how Westmoreland will restructure its $90 million debt and divest of its core assets, the company has also sought the ability to pass control of its union contracts to creditors, which the United Mine Workers of America argued it cannot do, according to court documents.

Westmoreland has insisted that the financial difficulties of the market have forced its hand.

“The unfortunate reality is that Westmoreland Coal Company and its subsidiaries cannot survive as a going concern without material changes to the retiree medical benefits currently offered to union employees and retirees,” the company noted in a letter to the union Sept. 18.

The Kemmerer coal mine employed 286 miners as of June. The mine is the sole supplier of coal to PacifiCorp’s nearby Naughton power plant. PacifiCorp — the parent company of Wyoming’s largest utility — objected to Westmoreland’s restructuring plan last month, arguing that it would “advance the interests of private financial creditors over public utilities and their customers.”

Unsecured creditors for Westmoreland have also objected to a revised bankruptcy plan. A committee of these creditors noted that the reorganization plan does not provide assurances that unsecured creditors will be paid, though the original plan promised those with unsecured debts would receive their due share, according to court filings.

A call to the Colorado Springs, Colorado-based firm was not returned Thursday. The company operates in a number of states, including Montana, North Dakota and New Mexico.

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Energy Reporter

Heather Richards writes about energy and the environment. A native of the Blue Ridge Mountains in Virginia, she moved to Wyoming in 2015 to cover natural resources and government in Buffalo. Heather joined the Star Tribune later that year.

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