By Timothy Puko and Andrew Scurria
April 14, 2018 - Coal magnate Robert Murray, after warning his company could be pushed into bankruptcy if the Midwest coal industry failed to get a bailout from federal regulators, said he now expects his company to thrive whether or not the Trump administration intervenes.
Murray, chief executive and controlling owner of Murray Energy Corp. and a major Trump supporter, said in an interview that surging demand for coal in Asia, along with his company’s growing exports to that region, have revived his business. Growing Chinese imports, and a recovering global economy, drove up coal prices, offsetting a long-term decline in U.S. demand.
Murray Energy also is ramping up sales in India with help from a London-based trading firm that the company helped open in 2015.
“I've got the best coal company in the world,” he said.
That optimistic outlook marks a strong contrast to what Murray has said about his business not long ago. Last summer, he told the White House that his company’s Appalachian mines might close without an emergency lifeline for the power-plant fleet at FirstEnergy Corp., a major coal-burning customer of Murray Energy. A FirstEnergy subsidiary requested federal intervention last month and the Energy Department is weighing a response.
Murray rose to prominence after acquisitions made his company the largest privately owned U.S. coal miner earlier this decade.
After Trump was elected president, Murray has injected himself into the center of a national debate about what the Trump administration might do to save the shrinking coal industry.
He has personally asked Trump to arrange an emergency order — one designed for times of war and natural disasters — to keep unprofitable coal-fired plants open, saying losing them creates a national-security risk. But natural gas-burning plants, solar farms and wind turbines are beating coal in competitive power markets, and Murray’s critics say intervention undermines free competition and distorts markets.
An emergency request in front of the Energy Department — formally filed by a FirstEnergy subsidiary would benefit many of the plants in Ohio and the surrounding states that buy Murray coal. He has already revived his company through a series of acquisitions and by creating a trading house, Javelin Global Commodities Ltd., just as prices started to rebound. Murray spent much of 2016 and 2017 publicly fretting he may miss payments on more than $4 billion in debt at Murray and a sister company, and another $2 billion in retiree obligations, but now he is making them without trouble, he told the Journal.
The country’s electricity grid is in the middle of a historic transformation, one drawing increasing attention from policy makers in Washington and several state capitals. Rapid technological advancements have made gas-fired and renewable power dramatically cheaper, running dozens of nuclear and coal-fired competitors out of business. The viability of a number of corporations — and thousands of jobs — are on the line.
Some states have approved help for nuclear-power plants, and FirstEnergy has forced a similar decision on the Trump administration. In late March it asked the Energy Department to declare an emergency under a lightly used, 83-year-old law to guarantee profits for its nuclear and coal-fired plants and dozens of others across the Midwest and Mid-Atlantic states. Its FirstEnergy Solutions power-generation businesses running nuclear and coal-fired power plants, known as FES, filed for bankruptcy protection two days later.
FES operates coal-powered plants in Ohio and Pennsylvania with combined capacity over 4,700 megawatts. It was bankruptcy warnings from FES last year that prompted Murray to warn last year that Murray Energy, too, could go under. He said an FES chapter 11 would tip Murray Energy into an “immediate bankruptcy” as well.
But Murray Energy hasn't filed for bankruptcy protection and doesn't need to now, Murray told the Journal. It isn't clear whether Murray Energy’s supply deals with FES will survive those businesses' bankruptcy. An FES spokesman declined to comment. Creditors want the coal plants sold.
Murray said his company and FirstEnergy Corp. weren't making a politically calculated move to force Trump into a direct decision on whether to provide emergency help for coal. But he also noted that many of the plants that would be affected are in Ohio and Pennsylvania, swing states crucial to Trump’s presidential campaign.
“If he doesn't do it, the president is going to have a problem,” Murray told the Journal. “It’s important for the president to support the people who supported him.”
Murray and his company have been generous donors to Trump’s political groups, Federal Election Commission records show.
Murray Energy gave $1 million last August to America First Action, a super political-action committee that supports Trump. The company gave $300,000 to the president’s inauguration fund and $200,000 to a 2016 super PAC backing Trump.
The company’s PAC donated $250,000 to the Republican convention at which Trump accepted the Republican presidential nomination. Both the company PAC and Murray also contributed to Trump’s 2016 campaign.
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