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Thursday, July 5, 2007

Thousands of Asbestos Claims Delay ASARCO Reorganization Plan

Thousands of Asbestos Claims Delay ASARCO Reorganization Plan

Copper-mining company ASARCO LLC has asked a U.S. Bankruptcy Court in Corpus Christi, Texas to grant them an extension for filing their reorganization plan, claiming that they are overwhelmed with asbestos injury claims and myriad environmental pollution lawsuits.

According to a Forbes article, the company claims it is justified in asking for an extension until December, noting that it’s case is complex. The mining company is currently facing 95,000 personal injury asbestos-related claims. The deadline for reorganization is currently set to expire on August 9th, 2007.

“While Asarco’s reorganization may not be the largest corporate reorganization in history based on assets alone, it certainly rivals any previous Chapter 11 case for complexity and breadth of the individual issues involved,” a statement issued by the company said.

ASARCO has already received six extensions since filing for bankruptcy in August 2005. A spokesperson for the company notes, however, that they have made “significant progress” in developing their restructuring plan and negotiating with creditors and expect to be able to meet the December date if the extension is granted.

According to the article, the company has also filed motions to obtain court-approved estimates of the tens of thousands of asbestos claims as well as 850 tort claims and its liability for environmental cleanup.

ASARCO is currently faced with environmental claims filed by the U.S. government, 16 states, two Indian tribes and private parties. Those claims total more than $10 billion, according to the company.

Lawyers for those individuals with asbestos claims against ASARCO have noted that the company’s asbestos liabilities are between $906 million and $2.66 billion.

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