Environmental Groups Take New Approach to Coal Industry Bankruptcies

As bankruptcies continue to rock the coal sector, environmental groups are turning up the pressure on the Interior Department to either reexamine or stop altogether the practice of self-bonding, including making unprecedented use of a complaint mechanism to force the government's hand.

Complaints filed since last December have yielded at least 26 10-day notices (TDNs) from the Office of Surface Mining Reclamation and Enforcement to regulators in Colorado, Illinois, Indiana, New Mexico and Wyoming. The notices were sent in regard to Arch Coal Inc., Alpha Natural Resources Inc. and Peabody Energy Corp., all of which have now declared bankruptcy.

After a petitioner files a complaint to the OSMRE, the agency can issue a TDN to the state, giving it 10 days to investigate and respond. The OSMRE can accept the response or reject it and order a federal inspection.

“Something needs to be done to get OSM more involved in the process, because the states clearly aren't doing their job,” Theo Spencer, senior policy advocate at the Natural Resources Defense Council, told Bloomberg BNA.

But OSMRE's defenders say the agency is already doing everything it can under the law, including creating an internal team charged with setting best practices throughout the states on financial assurance.

10 day notices

Bloomberg BNA reporters Stephen Lee and Tripp Baltz cover the issue in a special report for subscribers, Advocates Take New Approach to Coal Bankruptcies.