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Westmoreland updates seasonal borrowing terms

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World Coal,

Westmoreland Coal Co. has successfully modified certain terms of its revolving credit line to provide financing flexibility over the summer – a time when cash flow is typically at its lowest.

The changes include a 16 day extension to the seasonal borrowing period, an easing of the fixed charge coverage ratio from 1:10 to 1:15, and a reduction in the seasonal borrowing availability from US$25 million to US$19 million.

“The changes we made better accommodate the seasonal trends in our business,” said Jason Veenstra, Westmoreland’s Chief Financial Officer.

The seasonal borrowing period now runs from 15 June to 31 August. There was no change to the US$50 million base borrowing commitment.

Westmoreland owns opencast coal operations in the US and Canada, as well as underground coal mines in Ohio and New Mexico. It also has a stake in the ROVA coal-fired power plant in North Carolina through Westmoreland Resource Partners, a publically-traded coal master limited partnership.

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