BILLINGS, Mont. (AP) -- A proposed deal on a Montana coal mine that supporters said would boost Asian exports of the fuel via the West Coast has stalled, according to court documents that show the companies involved are renegotiating terms of the sale.
Representatives of the two companies involved said Wednesday that a deal still was expected, but did not immediately address what prompted the renegotiation or what the new terms might be.
The original deal, announced in December, entailed a complex transaction in which Australia-based Ambre Energy would pay $57 million to Cloud Peak Energy for full control of the Decker mine near the Wyoming border.
Ambre has been seeking to ramp up production from the once-bustling mine, and ship coal to growing Asian markets through a pair of proposed ports along the Columbia River.
But the company faces stiff opposition in Oregon and Washington state, and critics have questioned whether Ambre has the financial wherewithal to see its ambitious plans to fruition.
Cloud Peak is seeking land and rail easements for a new Wyoming mine in the deal with Ambre.
The Wyoming-based company also would gain the option to move 5 million tons of coal annually through Ambre's Millennium port in Longview, Wash. — part of an industry-wide strategy to increase exports as domestic coal sales have faltered.
It was not clear what prompted the companies to seek an extension of a May 10 deadline they faced to settle a dispute over the Decker mine. The mine is co-owned by Cloud Peak and Ambre and has been the subject of a management quarrel that led to a lawsuit in U.S. District Court.
Court filings requesting until July 12 to finalize the deal cited "unforeseen complications with the original sale."
The sale originally was slated to close April 1 and the deadline already had been extended once.
Ambre spokeswoman Liz Fuller said the company was continuing to work to complete the mine acquisition and that a deal could be finalized in the next few months.
A Cloud Peak spokesman, Rick Curtsinger, said the company had no immediate comment.
Decker was once among the largest coal strip mines in the U.S., and produced more than 10 million tons annually as recently as 2002.
But domestic demand for coal has been on the decline due to competition from cheap natural gas and the costs of making older power plants compliant with environmental regulations.
In December, Decker laid off 59 employees — more than one-third of its workforce. The mine is on track to extract only 1.5 million tons of coal this year, based on first quarter production figures reported to the U.S. Department of Labor.
Australian media last year reported that Ambre was at risk of financial collapse after a proposed coal mine and coal-to-liquid fuels plant it was pursuing in the country was rejected by government officials.
The Sightline Institute, a Seattle-based environmental think tank, in February released a report that revealed Ambre racked up losses of more than $124 million from 2005 through 2012. The company responded at the time that early losses are not uncommon for companies developing new projects.
- Mergers, Acquisitions & Takeovers
- Ambre Energy