NEW YORK (AP) â¿¿ Shares of Patriot Coal Corp. recovered a bit Wednesday, a day after plunging 35 percent on concerns that the mining company could run short on cash. The gains came despite a move by Standard & Poor's Ratings Services to lower its ratings for the coal company even further into junk status. THE SPARK: Patriot announced Tuesday afternoon that it is working with private equity firm The Blackstone Group and the law firm Davis Polk & Wardwell LLP to secure a financing package. Investors are concerned that the company will not be able to secure a $625 million loan, announced earlier this month, before it must repay older loans by next March. Patriot said Tuesday that it is continuing to work with the lenders. Meanwhile, S&P said Wednesday that it cut Patriot Coal's corporate credit to "CCC" from "B-," citing the uncertainty surrounding the company's ability to secure new financing. The ratings service also lowered its issue-level rating on the coal company's senior unsecured debt to "CCC" from "B-." THE BACKGROUND: Coal companies are suffering from lower demand and sliding prices. Utilities in the U.S. are using cheaper natural gas to generate electricity, which is dramatically lowering demand for coal used to power electric generators. So coal companies have looked abroad for growth. But with a recent economic slowdown in China, investors fear U.S. coal makers won't be able to export as much as had been hoped. Patriot also has other problems. Last week, the St. Louis company lowered its sales volume and price estimates for coal used to make steel, citing a potential customer default. THE ANALYSIS: Patriot's shares likely will remain volatile, Sterne Agee analyst Michael S. Dudas told clients in a research note. The timing of the announcement about a potential default by a customer could not have been worse for the company, given its loan needs, he wrote.