TORONTO (miningweekly.com) – Seventeen months after emerging from an 18-month-long Chapter 11 reorganisation, Eastern US coal producer Patriot Coal on Tuesday again filed for creditor protection, citing challenging market conditions having forced it to engage in active talks for a sale of “substantially all” of the company's operating assets to a strategic partner.

The Scott Depot, Western Virginia-based miner said it was also engaged in ongoing discussions with key stakeholders as it evaluated a range of strategic alternatives to increase the value of its assets.

Patriot had secured a commitment of $100-million in financing from its current secured creditors to support its mining and marketing operations during the reorganisation.

The company emerged from its previous Chapter 11 bankruptcy in December 2013, after filing in July 2012.

In its voluntary petition to the US Bankruptcy Court’s Eastern District of Virginia, Patriot listed assets and liabilities of more than $1-billion.

"In light of the challenging market conditions and after a comprehensive review of our alternatives, the board and management team have determined that this process represents the best path forward for Patriot and its stakeholders,” president and CEO Bob Bennett noted.

Patriot had eight active mining complexes in Northern and Central Appalachia, shipping to domestic and international electricity generators, industrial users and metallurgical coal customers.

It controlled about 1.4-billion tons of proven and probable coal reserves.

Appalachian thermal coal markets had been particularly hard hit over recent months by the combined impacts of coal-fired plant closures, which were driven by the US Environmental Protection Agency’s stricter emissions regulations, low-cost natural gas and fewer export opportunities.

Meanwhile, the clock was ticking for fellow coal producer Walter Energy, which on April 15 missed interest payments on its 9.5% senior secured notes due 2019 and its 8.5% senior notes due 2021. The company opted for the 30-day grace period under the terms of the notes, which could give Walter Energy time to renegotiate a payment plan or devise other methods of obtaining the funds to pay the balance.

The grace period would expire on Friday.