Coal producers legally must restore damaged land, but some are dodging obligations A Bloomberg News/NPR investigation found large U.S. coal companies used bankruptcy and asset transfers to move old mines to shaky new owners, putting at risk federally mandated land reclamation.

Coal producers legally must restore damaged land, but some are dodging obligations

Coal producers legally must restore damaged land, but some are dodging obligations

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A Bloomberg News/NPR investigation found large U.S. coal companies used bankruptcy and asset transfers to move old mines to shaky new owners, putting at risk federally mandated land reclamation.

A MARTINEZ, HOST:

Over the last decade, the coal industry collapsed, leaving the largest producers bankrupt. This, however, turned out to be an opportunity. Coal companies are legally mandated to restore the torn-up land and polluted creeks left behind when mining is done. But the biggest companies shifted the cleanup to others. An investigation by Bloomberg News and NPR shows that many old coal mines have new owners that are not completing the work, so the pollution and damage that used to be the industry's problem may become the public's. Joining us now are Josh Saul and Zach Mider of Bloomberg and NPR's Dave Mistich.

We'll start with you, Josh. This reporting shows that as coal operators went bankrupt, many of them were able to get out of their environmental cleanup responsibilities. Walk us through how this works.

JOSH SAUL: The law is very clear. It says that coal companies have to reclaim the land, meaning they have to return it to its original shape, its contours, and they have to plant vegetation, like trees and grasses. They have to also stop any flooding when they finish mining. But what we found is that coal companies have gotten really good at using a specific tactic to avoid paying for cleaning up their own messes. What the big publicly traded, billion-dollar coal companies do is they transfer the old, idle coal mines to smaller, private, financially weaker companies. And if those new owners go broke, then nobody is left to do the cleanup work.

MARTINEZ: Wow. So, Dave, you and Josh traveled to the heart of Appalachian coal country. Tell us what you saw there.

DAVE MISTICH, BYLINE: That's right. So we traveled to southern West Virginia and eastern Kentucky, and people there told us about red mine water flooding their homes. We met Gary VanNatter in Mingo County, W.Va, as he was packing his truck up out of his driveway so he could take some wood back to the store that got damaged by some flooding.

GARY VANNATTER: It's coming down like a raging river. I've never seen it that bad. It's just getting progressively worse in the past couple of years.

MISTICH: VanNatter told us these floods are becoming more frequent. And it's done a lot of damage to his property.

VANNATTER: Sinking the foundation - it's - the whole back of the house has dropped on that side. This two-car garage, this two-story has sunk.

MISTICH: And the effects go beyond just that. People's drinking water and septic tanks get knocked out and ruined. There's so much selenium and acid runoff in streams that it kills or deforms fish and other wildlife. Lots of people talk about how they used to gather firewood or ginseng in an area that now looks like a moonscape, or they used to swim or fish in a river that they're now scared to touch the water. One older man I talked to - mine runoff weakened to the floor of his home. And one day he walked into his dining room and fell right through it into the mine water below. He got stuck in his own floor.

MARTINEZ: Wow. That's amazing. Zach Mider of Bloomberg News spent a lot of time looking into this. Zach, can you give us an example of a coal company that's gotten out of these responsibilities?

ZACH MIDER: Sure. When the downturn in the industry hit about a decade ago, this company called Alpha had more of these old, idle mines than anybody. But now they've been able to get rid of most of them. They handed the biggest chunk - that's about 230 mining permits - to a much smaller company called Lexington Coal. Now, Alpha says it's a responsible coal company that complies with all the rules. And they said state regulators signed off on the deal. Alpha handed over a lot of cash to Lexington, too, so that it could clean everything up.

MARTINEZ: Josh, what does this mean for Alpha? And has the smaller company, Lexington, made good on the responsibilities that it's taken on?

SAUL: What it meant was that Alpha could wash its hands of the responsibility to clean up the land no matter what happened later. The two companies talked about a five-year plan to accelerate reclamation. Well, it's been five years. Lexington hasn't cleaned up many of these mines, and it's unclear if they even have the money to do it. Meanwhile, they're racking up more environmental violations this year than almost any other company in the country. But the deal's worked out great for Alpha. The price of coal has skyrocketed, and the company's stock is up more than 700%.

MARTINEZ: Wow. So, Dave, you actually got the chance to fly over some of these former alpha mines in West Virginia. What did you take away from that?

MISTICH: Really just how pervasive surface mining is in these areas and how many people live next to it - you know, you can't really get a sense of that from the ground, given the topography. And that's even, you know, looking at maps or by using a drone. When you're just a few thousand feet up in the air, you can see it in every direction. It all looks very, very similar, just flat, barren land that used to be a mountain.

And you can tell they're getting some coal out of some of these mines. But some of the mines owned by Lexington have been idle for years. Reclamation should have taken place or should be happening now. And it's just not happening. And, you know, like Josh said, that'd be returning the land to its original contour or planting something like trees or grass.

MARTINEZ: Zach, I guess I can see why the big coal producers, like Alpha, might want to get rid of all of their old, used-up mines, so they don't have to clean them up. But what about the other side of these deals? I mean, who would take on all those responsibilities?

MIDER: Yeah. So there's a guy named Tom Clarke, and he wasn't a coal miner at all. He called himself an environmentalist. And when all these big coal companies started going under, Clarke showed up to take their mines off their hands. He had this wacky plan. He was going to save the coal industry and save the planet at the same time. He was going to mine coal and then plant trees to offset their carbon emissions. And so for a while, he's kind of a hero in West Virginia.

MARTINEZ: Oh. Well, how did that work out?

MIDER: It was a disaster. Clarke ran out of money. He racked up 160 environmental violations. Eventually, a court had to take over his operation. But looking at it from another perspective, that of the big mining companies whose mines he took over, it was kind of a success. One West Virginia official estimated that cleaning up just Clarke's mines could cost hundreds of millions of dollars. That's money that the companies that developed those mines will never have to pay.

MARTINEZ: That's Zach Mider and Josh Saul of Bloomberg News and NPR's Dave Mistich. My thanks to all three of you.

MISTICH: You're welcome.

MIDER: Thanks a lot.

SAUL: Thank you.

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