Yesterday afternoon, the Eagle Butte and Belle Ayr mines near Gillette closed and sent roughly 700 workers home after Blackjewel LLC filed for bankruptcy and was denied $20 million in financing to continue operations.
Throughout the day, the Star-Tribune will update this page as we learn more about the fallout from the situation.
New backer emerges
According to Blackjewel lawyers, the company has new financing in line as it tries to avoid Chapter 7 bankruptcy.
The emergency hearing that began Tuesday afternoon had not ended as of 5:30, according to Stephen D. Lerner of Squire Patton Boggs LLP, who is representing Blackjewel.
Gov. Mark Gordon and other state officials met with Campbell County leaders and miners in Gillette early Tuesday afternoon to discuss what’s next for the community.
Gordon walked locals through the rapid response work that members of the Department of Workforce Services and the Department of Environmental Quality had been conducting throughout the day, from educating out-of-work miners about retraining opportunities to offering financial assistance for job training.
But state officials also heard of immediate problems already being faced by miners.
Though no workers have been officially laid off, within 24 hours the local unemployment office ran out of materials for miners seeking unemployment.
If the state would have to reclaim the mines, officials believe there is adequate cover for the state pending a judge’s ruling in bankruptcy court.
“I would like to say with assurance that we are fully bonded for both facilities — both for Belle Ayr and Eagle Butte,” Department of Environmental Quality Director Todd Parfitt said. “There is no question that we have adequate bonding in place for both facilities in the situation — we’re not there yet — but in the situation we had to forfeit on those bonds.”
What’s next for the mine, and its workers, is still an unknown. Gordon said he had not yet heard from the mine’s owner, Jeff Hoops, on any future plans for the mine.
“I look forward to his call,” Gordon said.
Ruling expected today
The fate of the mines and their roughly 700 workers could depend on a ruling in federal bankruptcy court this afternoon.
According to federal court documents, Blackjewel requested an expedited hearing in the Southern District of West Virginia on Tuesday morning following the denial of a $20 million loan from its creditor, United Bank.
The reason, Blackjewel argued in court documents filed in West Virginia on Tuesday, is dire. According to the company, if a hearing wasn’t expedited, the company would have to convert its bankruptcy filing from Chapter 11 — a restructuring of the company — to Chapter 7, which calls for a complete liquidation of the company’s assets.
“If that occurs, untold amounts of value of the Debtors’ assets and estates will be destroyed and more than 1,700 people will be out of work,” the company wrote. “It is imperative that the revised financing proposal be heard today, if at all possible, if the Debtors are to continue as a going concern.”
The motion was granted, with the hearing set to take place at 2:30 p.m. Mountain Time in the Southern District of West Virginia.
Checks on hold
Blackjewel owner Jeff Hoops told the Star-Tribune that he paid workers with cashier checks this week. But some workers say they haven't been able to access the money due to a bank hold on the checks.
According to Blackjewel employee Brian Wintermute, his regular direct deposits didn’t go through Friday. He was told by the company that he would be paid at 5 p.m. Monday. But Wintermute said he received a cashier check instead and the bank placed a three-day hold on the checks.
Meladie Kelly, 25, confirmed that her husband’s check had a three-day hold too. Kelly’s husband Will Bruns, 25, worked at the mine but was on short-term disability.
“My heart sunk,” Bruns said at the workforce center. The 25-year-old had worked as truck driver for Blackjewel and thought at first he had done something to cause the layoff.
“I just broke down,” he said.
Kelly works at Dollar Tree for $9 an hour, and the couple has two kids. Her income alone is not enough to support the family, she said.
The Workforce Center in Gillette extended its hours until 7 p.m. Tuesday.
Trey McConnell, general manager of the Railyard, a restaurant in downtown Gillette, said the restaurant will be serving Blackjewel employees food and alcohol for free. As he cooked in the kitchen, he said a flood of community donations came in for the workers immediately after the news.
McConnell, who was laid off from his job eight years ago, decided to extend this gesture because “I didn’t have anyone out there to help me out.”
He wants to show that the community cares about the miners, he added.
Numerous state agencies mobilized their staffs Tuesday morning to respond to the mines’ closure, looking to provide support for the hundreds of affected workers and to address any potential environmental and safety concerns that could be present at the mine after Monday's sudden work stoppage.
The state Department of Workforce Services is sending representatives from its offices in Casper and Cheyenne to offer immediate assistance and unemployment information to those recently put out of work at the mine. On Wednesday, the department will be hosting the first of two informational sessions at Gillete College’s Technical Education Center, offering workers information on vocational rehabilitation and training services as well as offering personalized assistance to those with needs that may exceed what their unemployment insurance can cover.
The DWS is also opening up numerous locations around Campbell County to handle the massive influx of former employees seeking assistance, a spokesperson said.
By 9 a.m., about 100 workers had already been through the department's Gillette office seeking assistance, according to manager Rick Mansheim.
Meanwhile, both mines sit empty, opening up the potential for safety and environmental concerns stemming from the sudden cessation of operations at both mines.
“There’s not even a skeleton crew there right now,” said Keith Guille, a spokesperson for the DEQ.
Both the DEQ and the state’s mine inspectors are currently on their way to Gillette to inspect the mines for any potential safety hazards, Guille said. Local law enforcement has already closed the entrances to both mines.
Enzi heads home
U.S. Senator and former Gillette Mayor Mike Enzi is headed back home today to assess the fallout from the recent closure of two major mines in the area, his office said in a statement.
“Diana and I were devastated to learn about the Eagle Butte and Belle Ayr mines layoffs," Enzi said. "We send our heartfelt sympathies to everyone impacted by this horrible news. This kind of unexpected, mass layoff does not benefit anyone. It immediately affects our families, friends and neighbors in very real ways. It ripples through our communities, our state and our economy. This is not the first time we have faced such heartbreaking news, but I am always amazed by the strength of our community to help those in need. I work every day trying to help the folks in our state, and I will work with Governor Gordon and the rest of the Wyoming delegation to fight for the best possible outcome for our Wyoming workers and our community.”
Sen. John Barrasso, meanwhile, has also put out a statement:
“Any time there is a layoff of workers in Wyoming, it’s heartbreaking," he said. "The situation at Eagle Butte and Belle Ayr mines is devastating for hundreds of workers, their families and the communities they support. I’ve spoken to Governor Gordon and pledged to help in any way possible. I will continue to support efforts by the governor and our state and local agencies to help the workers and communities who are directly impacted.”
Rep. Liz Cheney released her own statement on Tuesday afternoon:
“Yesterday’s news is devastating for the individuals and families affected, as well as for our entire state. While the Trump Administration has made great strides in reversing President Obama’s War on Coal, these far-reaching regulations that unfairly penalize this industry are still causing pain in Wyoming and today is the latest example of that.
“Coal from Wyoming’s Powder River Basin is the cleanest in the world and provides power to 27 states. Ensuring the reliability of our electric grid by supporting coal — a crucial baseload power source — is an economic and national security priority.
"I will continue working with the Trump Administration to replace suffocating regulations with policies that help support the fossil fuels we need to power our nation. I am also traveling to Gillette this week to talk to those affected by these closures and stand ready to use all the tools at the disposal of the federal government to help the people of our state who lost their jobs. I encourage anyone who is affected to reach out to my office for assistance.”
The top official with the state’s largest mining association described yesterday's closures as an “unprecedented” event in the history of the state’s rich — and recently troubled — coal industry.
Wyoming Mining Association executive director Travis Deti told the Star-Tribune on Tuesday morning that while the state is currently working to assist those now suddenly out of work, Wyoming seemed to have been caught stunned and flat-footed by the suddenness of the layoffs. Deti said that never before has an out-of-state company declared such dramatic layoffs following a bankruptcy declaration.
Entrance to Eagle Butte Mine blocked this morning. No #workers on the job today after Blackjewel closed it’s 2 Wyoming #coal mines. Some workers coming in this morning to claim personal property but otherwise no one is being admitted, according to a sheriff. @CSTribune pic.twitter.com/YGVCnix80P— Camille S. Erickson (@camillesuzanne) July 2, 2019
“It is unprecedented, and that makes this one a little different,” Deti said. “When you saw the bankruptcies of the other companies several years ago, they were able to keep operating. They did have some workforce reductions, but they were able to keep operating. That doesn't seem to be the case here. We’re watching to see how this unfolds, but from our perspective right now, our concern is on the miners and their families.”
“I don’t think we have anything to deal with something of this magnitude or a blueprint forward,” Deti added. “The state is not unprepared for this — given what happened a few years ago, the Department of Workforce Services is going to be up there today to start the process of helping those guys. But there are a lot of question marks that remain. This is pretty unprecedented.”
Gov. Mark Gordon will meet with local officials at 1:30 p.m. Tuesday at the Campbell County Courthouse. The meeting will be livestreamed.
Mine taxes critical to community
Campbell County Treasurer Rachael Knust said Tuesday morning that the county attorney's office will attempt to collect Blackjewel's unpaid property taxes.
"But my initial reaction (to the closures) is that I was heartbroken," Knust said, "because of all the families that got sent home.”
Blackjewel had been making payments in line with its latest financial agreement, she said. But Friday, the company was supposed to make a $1 million payment. It never came.
"Then Monday, we got an email from bankruptcy court," Knust said. "We had no forewarning. Just like the employees, I know they showed up for work on Monday morning.”
Those taxes largely go to local schools, Knust said.
"It goes to the schools, to the hospital, to the cemetery, to the like recreation center," she said. "And then just a portion, some of it goes to the city some of it goes to the county. That’s just it doesn’t just affect one person, it affects everybody.”
Knust expects that it won't take long for the effects of the closures to set in.
"We just got done with our fiscal year in June," she said. "We will start feeling it. Our budgets are in, but I’m positive that everyone will start to look at what we will want to purchase and decide whether it is needed.”
"I think right now there is a lot uncertainty," Knust added. "When I go home at night and go by the mines and it’s all dark, everything is just sad.”