Contempt concern scrubs hearing on Wyoming coal mine permit

By Mead Gruver, Associated Press

A landowners group withdrew its request Thursday for a hearing on a Wyoming coal mine's permit amid the possibility it could be held in contempt of court.

CHEYENNE, Wyo. (AP) — A landowners group withdrew its request Thursday for a hearing on a Wyoming coal mine's permit amid the possibility it could be held in contempt of court.

The Powder River Basin Resource Council has concerns about Wyoming regulators' plan to renew the permit for the Eagle Butte coal mine. Insufficient bond for reclamation exists and Wyoming could be left on the hook for tens of millions of dollars if the coal mine ever closed and needed to be fully reclaimed, or filled in and restored to a natural state, according to the Sheridan-based group.

The mine is coming up for a regular permit renewal as its owner, Alpha Natural Resources, goes through Chapter 11 bankruptcy proceedings in federal court in Virginia.

A court-approved agreement between the state and the company says any matters related to the permit must go through the bankruptcy court, attorneys for Alpha and the state said in legal documents filed with the Wyoming Environmental Quality Council. It is the citizen review panel for the Wyoming Department of Environmental Quality.

"Failure to abide by the order of the bankruptcy court could subject the Powder River Basin Resource Council or any other initiating individual or entity, including DEQ, to civil contempt proceedings," deputy attorney general James Kaste and senior assistant attorney general Andrew Kuhlmann wrote in a notice filed with the Environmental Quality Council.

They wrote that the proper time and venue to raise concerns about the permit was weeks ago in Virginia bankruptcy court, before a judge approved the agreement.

The landowners group withdrew its request for review of the coal mine permit hours before the Environmental Quality Council's regular hearing Thursday.

"Out of an abundance of caution and concern about our organization, we opted to stay the proceedings," Powder River Basin Resource Council attorney Shannon Anderson said.

Kuhlmann declined to comment.

Alpha Natural Resources' two Wyoming coal mines carry a total of $411 million in required reclamation bonding. The state allowed the company to provide regulators with financial reassurance that it could cover the cost of reclamation — until last spring.

Under the court-approved agreement between the state and the company, Wyoming would get priority access to $61 million in case either or both mines closed and needed to be reclaimed. Wyoming would need to stand in line with other creditors to collect the remaining $351 million for reclamation.

The agreement also says that the pre-existing bonding requirements would not prevent the company from getting a new mine permit.

"It just shows you that this deal that Wyoming struck has significant consequences," Anderson said. "They are a regulatory agency, and they basically agreed to not regulate."

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