David Stetson, Contura Energy’s new CEO, stands to earn a $1 million salary, with the potential for a $450,000 bonus, and other valuable benefits in his first year of employment according to a company filing with the U.S. Securities and Exchange Commission.
Contura Energy is meanwhile maneuvering in a bankruptcy court to reacquire two shuttered Wyoming coal mines it offloaded two years ago.
Stetson is experienced in managing struggling coal companies, according to industry press and various coal company statements.
He’s shepherded several coal companies, including Alpha Natural Resources, through bankruptcy and its immediate aftermath. Alpha created Contura during its 2016 bankruptcy restructuring and spun its Wyoming mines onto the offshoot’s balance sheet.
Contura then sold those mines — Eagle Butte and Belle Ayr — to Blackjewel for no profit, in order to escape from financial obligations associated with the mines’ end of life, particularly mine reclamation obligations of nearly $230 million. But a state permitting challenge by the Powder River Basin Resource Council held-up up the deal and Blackjewel crashed into bankruptcy before the transfer was completed.
Now Contura, back on the hook for reclamation costs, is seeking to reacquire and reopen the mines, according to court filings made in a West Virginia bankruptcy court. That move is raising hopes of reemployment among miners, and fresh revenues among state budgeters, even as questions begin to emerge about Contura’s intentions and stability.
The company is the “stalking horse” bidder in an auction of Blackjewel’s mines that is set for Aug. 1. If no other company makes a higher bid, the mines would go to Contura pending a bankruptcy judge’s approval of the deal.
In industry news articles and company press releases, Stetson is described as a cost-conscious, conservative operator with a track record of restructuring troubled coal companies. Besides Alpha Natural Resources, he served as chairman for a spinoff from Westmoreland Coal Company when it emerged from bankruptcy earlier this year. The operation did not manage the Kemmerer Mine in Wyoming, owned by Westmoreland. Stetson also served as Chief Restructuring Officer for Trinity Coal during that company’s bankruptcy in 2013.
“People like myself understand you don’t over-leverage yourself, you don’t overextend yourself,” Stetson told S&P Global, a business publication, in May 2017.
By Andrew Graham