‘Stunning Collapse’ of Coal Industry Reveals the Risk to Taxpayers in Companies’ Self-Bonding Allowances

first_img FacebookTwitterLinkedInEmailPrint分享William Yardley for the Los Angeles Times:For four decades, mining companies have been required to repair land they mine to a form and function similar to its previous condition. The process is called reclamation, and, done well, it can be convincing. Some of the smoothest slopes and meadows here were shaped not by time and the elements but by federal law and heavy equipment.“What you’re looking at right now just won a national award,” Mark Dunn, the environmental manager for Cloud Peak Energy’s Cordero Rojo mine, said this month, pointing to a panorama that included active mining to the west and a restored stream and wetlands to the east. “We try to make it close to the way it was before — or better.”Now, however, amid a stunning collapse of the coal industry that has prompted some of the nation’s largest mining companies to file for bankruptcy, there are new questions about how the giant holes dug in Wyoming and elsewhere across the West will be filled and who will pay to fill them. Wyoming produces nearly 40% of the nation’s coal used for electricity.Under the Surface Mining Control and Reclamation Act of 1977, for mining to go on, reclamation has to go on. But in some cases, big companies have persuaded government regulators to let them operate under terms that seem to turn the law upside down: For reclamation to continue, mining has to continue.Last month, prompted by a complaint from environmental groups, the federal Office of Surface Mining Reclamation and Enforcement challenged Wyoming regulators to show that two major companies that have both filed for bankruptcy in the last year, Arch Coal and Alpha Natural Resources, have enough money to do the reclamation work they are obligated to do.In the weeks since then, following more complaints from environmental groups, the agency has made similar demands related to mines operated in Wyoming, Colorado, New Mexico, Indiana and Illinois by another imperiled company, Peabody Energy.All three of the companies have been allowed to meet many of their financial commitments for reclamation through a process called self-bonding. Under self-bonding, the companies do not have to pay a third party to guarantee that reclamation money would be there if the mining company suddenly failed. Instead, the companies essentially are allowed to say their financial strength is proof enough that they could meet their obligations.“The problem with self-bonding, basically, is that it’s based upon this notion of these companies being so wealthy and substantial,” said Mark Squillace, who teaches environmental law at the University of Colorado Law School. “It’s sort of like the banks being too big to fail, right?”Full article: Mining companies’ declining fortunes imperil the restoration of land they’ve mined ‘Stunning Collapse’ of Coal Industry Reveals the Risk to Taxpayers in Companies’ Self-Bonding Allowanceslast_img

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