A federal bankruptcy judge on Monday approved the company’s request to reject labor contracts and retiree benefits for unionized employees. The move is expected to save the company $60 million, Reuters reported.

A hearing on Alpha’s request to eliminate benefits for non-union miners is scheduled for May 17. None of the company’s Wyoming employees is represented by a union.

The future of Alpha’s Powder River Basin mines, Belle Ayr and Eagle Butte, hinge on the company’s reorganization plan.

Alpha has proposed splitting the company’s assets into two groups: core and non-core. Its most valuable properties, including Belle Ayr and Eagle Butte, would be sold. A group of the company’s creditors have agreed to submit a minimum bid of $500 million. Alpha will accept a higher bid if one is submitted.

The company’s remaining assets, marginal mines largely based in Appalachia, would form the basis of a second company. That business would largely focus on reclamation.

The government, in a filing with the U.S. Bankruptcy Court for the Eastern District of Virginia, argued every aspect of Alpha’s business was up for sale.

Nowhere in its disclosure statement, which outlined the company’s plan, did Alpha say what assets it plans to keep, attorneys for the U.S. Trustee wrote. The company recently agreed to sell its natural gas assets in Pennsylvania to Rice Energy for $200 million.

“Although this case was originally represented to the court and the creditors as a reorganization, the proposed plan makes clear that the end-game here is more in the nature of (if not a complete) liquidation,” they wrote.

Particularly worrisome, the government said, was the lack of detail provided about the second firm to be based in Appalachia. Alpha provided no information on how the company would operate or generate income given that its stated purpose is to focus on reclamation.

“If, in fact, the Reorganized Debtor is going to conduct no business other than to comply with its statutorily required clean-up and reclamation obligations, and will be essentially winding down Alpha’s business, then the disclosure statement needs to fully, clearly and openly disclose that,” the U.S. Trustee said.

The U.S. Trustee is a division of Justice Department.

The government is not the first to make that argument. The United Mine Workers of America advanced a similar line of thinking in its objection to Alpha’s plan to cut benefits for union employees and their spouses.

Selling its core-assets would deprive a restructured company from its primary sources of revenues, the union argued.

Alpha, in response, dismissed that claim, saying the company would continue operating its non-core assets in Appalachia.

“The debtors (Alpha) will retain the reclamation assets in order to conduct environmental reclamation, and these assets will continue to generate revenue for the purpose of paying reclamation claims and other obligations of the reorganized debtors,” the company wrote.

The company said Tuesday it intends to update its disclosure statement as the bankruptcy process proceeds. A hearing on the company’s plans is scheduled for May 17.