Laserfiche WebLink
Case 16-42529 Doc 53 Filed 04/13/16 Entered 04/13/16 12:50:57 Main Document <br />Pg3of31 <br />4. PEC is the world's largest private -sector coal company (by volume), with <br />26 active coal mining operations located in the United States and Australia. The Debtors' <br />domestic mines produce and sell thermal coal, which is primarily purchased by electricity <br />generators. PEC's Australian operations mine both thermal and metallurgical coal, a majority of <br />which is exported to international customers. As of December 31, 2015, Debtor PEC and its <br />subsidiaries' property holdings include 6.3 billion tons of proven and probable coal reserves and <br />approximately 500,000 acres of surface property through ownership and lease agreements. In <br />the United States alone, as of December 31, 2015, the Debtors held an estimated 5.5 billion tons <br />of proven and probable coal reserves, and the Debtors generated sales of approximately 180 <br />million tons of coal. In addition to its mining operations, the Debtors market and broker coal <br />from other coal producers across the United States, Australia, Europe and Asia. <br />5. The Debtors operate in a competitive and highly regulated industry that <br />has experienced strong headwinds and precipitously declining demand and pricing in recent <br />years due to the rise of low priced alternative energy sources — including an abundance of natural <br />gas. Combined with these factors, slowing global economic growth drove a wide range of goods <br />prices lower in 2015 and resulted in the largest broad market decline since 1991. Indeed, <br />demand from electric utilities in the United States alone declined approximately 110 million tons <br />in 2015. These market conditions, in connection with lower realized pricing in the United States <br />and Australia, resulted in a 21.0 million ton decline in the Debtors' and their non -debtor <br />subsidiaries' coal sales during 2015. As a result of these challenges, several large United States <br />coal companies have filed for chapter 1 I protection in recent years. <br />6. A comprehensive description of the Debtors' businesses and operations, <br />capital structure and the events leading to the commencement of these chapter 11 cases can be <br />-3- <br />