The judge overseeing the bankruptcy petition filed by the owner of the Belle Ayr and Eagle Butte coal mines in Campbell County has authorized the company to pay its employees and meet other business obligations.

Judge Frank Volk of the U.S. Bankruptcy Court for the Southern District of West Virginia on Thursday granted those and other motions from the Milton, W.V.-based Blackjewel LLC, which filed for Chapter 11 bankruptcy business reorganization on Monday.

That day, Blackjewel and four related debtors failed to obtain $20 million in emergency funding and then immediately closed the mines and sent more than 600 employees home, according to court documents.

As part of those filings, Blackjewel filed motions affecting business before the bankruptcy petition that would authorize it to do the following :

  • Pay wages, salaries, and other compensation.
  • Reimburse employee business expenses.
  • Pay tax and other withholdings to third parties.
  • Contribute to employee health and other benefit programs and continue those programs.
  • Pay workers' compensation and other insurance premiums.
  • Authorize banks to honor and process checks and electronic transfer requests.

The ability to perform these functions can happen because the court allowed Blackjewel to create a single master bank account that would incorporate seven closed bank accounts of Blackjewel and related debtor Revelation Energy LLC.

The bankruptcy court also authorized the debtors to pay vendors and shippers that billed Blackjewel before the bankruptcy petition.

It remains to be seen whether the mines will reopen and the employees will be called back to the mines, which are two of the most productive coal mines in the United States.

Wednesday, Volk granted a motion by Blackjewel to obtain $5 million in relief. As a condition of that arrangement, CEO Jeff Hoops was required to step down and be removed in all capacities from the company.

The money only can be used for a few things. Chiefly, the purpose is to implement security measures at the coal mines, so long as those security measures are essential to the preservation and protection of property and equipment.

The loans also can be used for essential firefighting personnel to the extent required to extinguish active fires at Blackjewel's mines.