The union is not releasing details of the settlement publicly until its members have had a chance to vote on the potential agreement. The vote is scheduled for Friday.
About 1,800 active or laid-off union members in West Virginia and Kentucky will be eligible to vote.
Patriot said in its press release it will file a motion with the Bankruptcy Court in St. Louis seeking authorization to enter into this agreement.
Bennett K. Hatfield, president and chief executive officer at Patriot Coal, said in a press release the agreement "represents the successful conclusion of a difficult negotiation."
"Both parties want to preserve jobs and protect healthcare benefits for retirees by keeping Patriot on track for reorganization - and not liquidation," Hatfield said. "We appreciate the cooperation of the UMWA leadership and the sacrifices of all of our employees and retirees as we work to restore Patriot to viability."
In West Virginia, lawmakers in both parties have criticized Patriot's plan to reduce retiree benefits. Members of the state's congressional delegation have sponsored bills to address the situation, though none have passed Congress.
Contact writer Jared Hunt at busin...@dailymail.com or 304-348-4836.