Patriot Coal is burning down

Patriot Coal Corporation (NYSE:PCX) in late afternoon was trading down over 36% on Tuesday on massive volumes, after announcing that it is has engaged private-equity firm Blackstone to refinance the business.

Trading in the stock was halted in a circuit breaker around lunchtime after falling 57.6% to $1.42 from its $3.35 opening price.

Around 78.6 million shares in Patriot Coal had changed hands by 3:30 pm EST on Tuesday compared to the daily average of only 7.9 million. The counter is now worth $209 million, less than a tenth of what it was valued at in July last year.

Earlier this month, Patriot Coal announced new loans totaling 625 million from Citigroup, Barclays and others to improve its financial position ahead of certain of its debt obligations becoming due in March 2013.

Patriot Coal 13 active mining complexes in Appalachia and the Illinois Basin and controls roughly 1.9 billion tons of proven and probable coal reserves.