A labor strike at the Balmer coal mine in southeastern British Columbia threatens plans by Westar Mining (TSE) to restructure the company’s debt.
Westar operates the Balmer and Greenhills open pit metallurgical coal mines, and members of the United Mine Workers of America at the Balmer mine recently voting 62% against the company’s final contract offer. The Balmer mine locked out its 1,123 employees, although operations at Greenhills are running normally.
Westar notes that the approval of its final offer was a key condition to achieving a restructuring of the company’s financial affairs with lenders and other stakeholders.
The offer included no wage increases in the first two years and a maximum increase of 5% in the third year.
The company stated it is continuing its discussions with its stakeholders to obtain agreement to a new financial recovery plan necessary to ensure the long-term viability of the mine.
Westar recently missed a $4.7 million principal payment due Apr. 30. It reported a net loss of $6.4 million for the three months ended Mar. 31. The operating loss for the period was $1.7 million.
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