LEXINGTON, KY, Sept. 11, 2019 (GLOBE NEWSWIRE) -- Rhino Resource Partners LP (OTCQB: RHNO) (“Rhino” or the “Partnership”) today announced that it closed an agreement with Blackjewel L.L.C. and related entities (“Blackjewel”) to purchase certain assets from Blackjewel for cash consideration of $850,000 plus an additional royalty of $250,000 that is payable within one year from the date of the purchase, as well as the assumption of associated reclamation obligations. The assets were purchased through a new wholly-owned subsidiary of Rhino, Jewell Valley Mining LLC, and consist of three underground, mid-vol metallurgical coal mines in Virginia that were actively producing coal prior to Blackjewel’s bankruptcy filing, along with a preparation plant, rail loadout facility, related mineral and surface rights and infrastructure and certain purchase contracts to be assumed by Rhino.
Rick Boone, President and Chief Executive Officer of Rhino’s general partner, stated, “We are pleased to announce this acquisition of high quality, mid-vol metallurgical coal assets in Virginia that will enable the coal miners in the area to return to work. We have begun the process of hiring key personnel for these operations as we look to return these mines to their full production capacity. We are also evaluating expanding production with these assets based on market demand for this high quality mid-vol coal. We have already met with the primary existing customer for this coal and they look forward to these mines resuming production as we believe this quality coal is key to the customer’s operations.
This acquisition provides Rhino with a high demand, mid-vol coal that we did not previously have in our portfolio of coal qualities. We believe market demand will be strong for this coal in future periods as this coal quality is not produced in large quantities in Central Appalachia.
Throughout this acquisition process, we were pleased with the continued support that our financing partner, Colbeck Capital Management, LLC (“Colbeck”), provided us, which is evidenced by Colbeck’s approval of a $5.0 million delayed draw per the terms of our current financing agreement to provide the funds needed to refurbish these operations. Colbeck's support during a time when other major coal producers have filed bankruptcy shows the strong relationship we have with our financing partner and their commitment to the Rhino organization.
This acquisition will provide many of the miners affected by this bankruptcy with the opportunity to return to work and we believe these assets will provide significant financial return that will provide long-lived value to Rhino’s unitholders.”
About Rhino Resource Partners LP
Rhino Resource Partners LP is a diversified energy limited partnership that is focused on coal and energy related assets and activities, including energy infrastructure investments. Rhino produces metallurgical and steam coal in a variety of basins throughout the United States.
Additional information regarding Rhino is available at its web site – RhinoLP.com.
Forward Looking Statements
Except for historical information, statements made in this press release are “forward-looking statements.” All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Rhino expects, believes or anticipates will or may occur in the future are forward-looking statements. These forward-looking statements are based on Rhino’s current expectations and beliefs concerning future developments and their potential effect on Rhino’s business, operating results, financial condition and similar matters. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting Rhino will turn out as Rhino anticipates. Whether actual results and developments in the future will conform to expectations is subject to significant risks, uncertainties and assumptions, many of which are beyond Rhino’s control or ability to predict. Therefore, actual results and developments could materially differ from Rhino’s historical experience, present expectations and what is expressed, implied or forecast in these forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the following: Rhino’s future levels of indebtedness, liquidity and compliance with debt covenants; volatility and recent declines in the price of Rhino’s common units; decline in coal prices, which depend upon several factors such as the supply of domestic and foreign coal, the demand for domestic and foreign coal, governmental regulations, price and availability of alternative fuels for electricity generation and prevailing economic conditions; declines in demand for electricity and coal; current and future environmental laws and regulations, which could materially increase operating costs or limit Rhino’s ability to produce and sell coal; extensive government regulation of mine operations, especially with respect to mine safety and health, which imposes significant actual and potential costs; difficulties in obtaining and/or renewing permits necessary for operations; the availability and prices of competing electricity generation fuels; a variety of operating risks, such as unfavorable geologic conditions, adverse weather conditions and natural disasters, mining and processing equipment unavailability, failures and unexpected maintenance problems and accidents, including fire and explosions from methane; poor mining conditions resulting from the effects of prior mining; the availability and costs of key supplies and commodities such as steel, diesel fuel and explosives; fluctuations in transportation costs or disruptions in transportation services, which could increase competition or impair Rhino’s ability to supply coal; a shortage of skilled labor, increased labor costs or work stoppages; Rhino’s ability to secure or acquire new or replacement high-quality coal reserves that are economically recoverable; material inaccuracies in Rhino’s estimates of coal reserves and non-reserve coal deposits; existing and future laws and regulations regulating the emission of sulfur dioxide and other compounds, which could affect coal consumers and reduce demand for coal; federal and state laws restricting the emissions of greenhouse gases; Rhino’s ability to acquire or failure to maintain, obtain or renew surety bonds used to secure obligations to reclaim mined property; Rhino’s dependence on a few customers and its ability to find and retain customers under favorable supply contracts; changes in consumption patterns by utilities away from the use of coal, such as changes resulting from low natural gas prices; changes in governmental regulation of the electric utility industry; defects in title in properties that Rhino owns or losses of any of its leasehold interests; Rhino’s ability to retain and attract senior management and other key personnel; material inaccuracy of assumptions underlying reclamation and mine closure obligations; and weakness in global economic conditions.
Other factors that could cause Rhino’s actual results to differ from its projected results are described in its filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Rhino undertakes no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, unless required by law.
News Release
Investor Contact:
Scott Morris
+1 859.519.3622
smorris@rhinolp.com
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