Mountain top removal (MTR) mining
is a form of strip mining in which coal companies use explosives to blast as
much as 800 to 1,000 feet off the tops of mountains order to reach the coal
seams that lie underneath. The resulting millions of tons of waste rock, dirt,
and vegetation are then dumped into surrounding valleys, burying miles and
miles of streams under piles of rubble hundreds of feet deep. Mountaintop
removal mining harms not only aquatic ecosystem, and water quality, it also
destroys hundreds of acres of healthy forests and fish and wildlife habitat,
including habitat of threatened and endangered species, when the tops of
mountains are blasted away.
Throughout the Appalachian region of the Eastern United States, more than 500 mountains have been flattened, first by clear-cutting forests,
then by blowing off the top layers of rock with powerful explosives. Giant
cranes (draglines) expose buried coal by scraping billions of tons of dirt off
the mountain. The debris is then dumped into neighboring valleys and streams. Rather
than remove coal from the mountain, MTR removes the mountain from the coal.
Mountaintop removal is a relatively new type of coal mining that began
in Appalachia in the 1970s as an extension of conventional strip mining
techniques. Primarily, mountaintop removal is occurring in West
Virginia, Kentucky, Virginia and Tennessee. Coal companies in Appalachia
are increasingly using this method because it allows for almost
complete recovery of coal seams while reducing the number of workers
required to a fraction of what conventional methods require.
what must happen
We urge all private banks involved in commercial lending and investment banking services for the mining sector to end their relationships with companies who practice mountaintop removal coal mining in Appalachia.
Our recommended "best practice" is a clear exclusion policy on commercial lending and investment banking services for all coal companies who practice mountaintop removal coal extraction.
Where banks choose to maintain relationships with this sector, we recommend a publicly available policy, with a clearly identified performance threshold and regular reporting on policy implementation. Banks should withdraw from any on-going financing relationships with clients that practice MTR and place MTR on their financing exclusion lists.
Coal companies use MTR mining methods because it allows for almost complete recovery of coal seams while significantly reducing the number of workers required compared to conventional methods. The coal-bearing counties of Appalachia are some of the poorest in the nation, despite the fact that some of the greatest wealth is being extracted from them. For marginalized coalfield resident communities, MTR has meant the loss of thousands of jobs and growing health risks.Poverty has increased in MTR regions, even as corporate profits soar.
Once coal is extracted, it is then washed and treated, resulting in waste water called coal sludge, a mix of water, coal dust, clay and toxic chemicals such as arsenic, mercury, lead, copper, selenium and chromium. Billions of gallons of this toxic soup is then stored in vast, unlined impoundments or injected for storage in abandoned underground-mines. Impoundments are often held in place by mining debris or earthen dams, making them unstable. Sludge dams have been known to fail. In October 2000, residents of Martin County, Kentucky suffered 306 million gallons of slurry entering their water supply. The disastrous spill was over 30 times the size of the Exxon Valdez spill.
MTR is a mining practice where explosives are used to remove the tops of mountains and expose the thin seams of coal that lie beneath. Once blasted, the earth from the mountaintop is then typically dumped in the neighboring valleys. As a result, MTR mining poses significant threats to water quality in Appalachia, and undermines the objectives and requirements of the Clean Water Act. According to a 2005 environmental impact statement, nearly 2,000 miles of Appalachian streams have been buried or contaminated.
After blasting has occurred, waste from mining operations is systematically dumped into nearby valleys, burying streams. This waste then releases toxic metals, killing life in streams and polluting ground water. Health problems such as cancer, liver and kidney disease and skin rashes have been found in correlation with people who drink water from wells contaminated by coal mining. The problem was exacerbated in 2002 when the Bush Administration changed rules in the Clean Water Act to allow waste material to be considered “fill,” effectively legalizing the dumping of toxic mining waste directly into Appalachian waterways.
The expansion of mountaintop removal mining is fuelled by the fact that the United States is in the midst of a coal rush. Currently, more than 150 new
coal-fired power plants are in various stages of development around the
country. The government is relaxing laws in order to allow even
more coal mining that destroys communities and ecosystems. These new
power plants will emit 600 million tons of carbon dioxide annually,
which is tantamount to doubling the number of cars on roads! Coal
is the single biggest obstacle to curbing global warming as well as destructive coal mining practices.
Dec 03, 2015, Former Massey Energy executive found guilty of conspiracy
According to The Atlantic: the former Massey Energy executive, Don Blankenship, was found guilty of conspiracy, but acquitted of securities fraud and making false statements related to the Upper Big Branch mine disaster in 2010.
May 06, 2014, Patriot fasing out of coal, but Alpha and Arch not
Of the three largest producers of MTR coal, Alpha Natural Resources, Arch Coal, and Patriot Coal, Patriot has already committed to phase out its MTR operations. But Arch and Alpha have maintained a pipeline of new MTR mining permits, even as the financial, regulatory, and reputational risks associated with MTR coal mining have become increasingly acute.
In 2013, top U.S. and European banks exited relationships with producers of MTR coal. As of April 2014, BNP Paribas, JPMorgan Chase, and Wells Fargo had terminated relationships with two of the largest mountaintop removal coal producers, Alpha Natural Resources (9.4 million tons of MTR coal produced in 2013) and Arch Coal (4.6 million tons in 2013). Unfortunately, as these banks exited MTR financing, Barclays scaled up its MTR financing, closing USD550 million in loan and bond transactions in 2013.
Feb 06, 2014, Federal court protects streams from surface mining
Regulatory and legal risks associated with MTR production have grown in
the past 12 months, with a February 2014 federal court decision striking
down a Bush-era rule that had gutted protections for streams impacted
by surface mining. As the first case study highlights, Alpha Natural
exposure to citizen lawsuits related to water pollution from its MTR mines more than doubled in 2013, as the company reached a record-setting USD227.5 million enforcement settlement with the U.S. Environmental Protection Agency and Department of Justice over water contamination from its mines.
May 06, 2013, Bankruptcies
The financial condition of many MTR-producing coal companies continued to deteriorate in 2013. Patriot Coal's 2012 bankruptcy was followed by bankruptcy filings at Essar Energy's Trinity Coal subsidiary in February 2013, and at James River Coal in April 2014. Ironically, the CEO of the #2 producer of MTR coal, Patriot Coal, has emerged as a voice against MTR, remarking that his company's agreement to exit MTR was ultimately good for business, as the second case study explains.
2013 was a painful year to lend to several MTR coal producers. Three
European banks, Credit Agricole, ING Capital, and Natixis faced the
especially daunting challenge of recovering USD104 million in outstanding
loans from their client Trinity Coal in bankruptcy court. After being
acquired by the Indian conglomerate Essar Group in 2010 for USD600
million, Trinity, which operates MTR mines in Kentucky and West
Virginia, was hit hard by slumping coal markets and failed to make
required payments to its suppliers and creditors, prompting over 50
lawsuits against the company.
According to the three banks,
Trinity defaulted on over USD104 million in credit obligations to them in
2011. After the company reportedly failed to negotiate with the banks,
they filed an involuntary bankruptcy petition against it in February
2013. A year later, Trinity's parent company agreed to a USD150 million
capital infusion for Trinity as part of a bankruptcy settlement, through
which Trinity's unsecured creditors were expected to receive 0.15 to 0.25 on the dollar.
Trinity isn't alone among MTR producers
facing acute financial distress. In February 2014, James River Coal,
which reported net losses of USD138.9 million in 2012 and was expected to
lose USD126.8 million in 2013 according to Bloomberg estimates,
renegotiated its revolving credit line with GE Capital and UBS to give
it time to explore "strategic alternatives" including a sale of all or
part of the company. At the same time, James River forged ahead with a
legal battle to secure a permit for a new mountaintop removal mine in
Kentucky in the face of legal challenges over the mine's potential
impacts on human health and the environment. James River later declared
bankruptcy in April 2014.
In contrast to James River, the CEO of
Patriot Coal, which agreed to phase out its MTR operations as part of a
2012 bankruptcy settlement, recently expressed a much dimmer view of the
viability of new MTR operations. In December 2013, he said that his
company's exit from MTR was good for business, helped Patriot avoid
growing regulatory, permitting, and litigation risks associated with the
practice, and that it is "increasingly unlikely that any producer is
going to invest a lot of money in building out a large-scale surface
mine in Central Appalachia." Nevertheless, James River appears determined to prove him wrong with their planned MTR mine.
Oct 30, 2012, Lawsuit Patriot Coal over selenium discharges
Patriot Coal faced a wave of citizen lawsuits over selenium discharges from its MTR mines and saw its seleniumrelated cleanup cost estimates rise to approximately USD449 million just prior to its bankruptcy filing in 2012.
- profile Arch Mineral Corporation was founded in 1969 as a partnership between Ashland Oil (now Ashland, Inc.) and the H. L. Hunt family of Dallas, Texas. Ashland Coal, Inc. was formed in 1975 as a subsidiary of Ashland Oil. The privately held Arch Mineral Corporation merged with Ashland Coal, Inc. in July 1997, creating the present-day company.
Arch's Dal-Tex mining operations above the town of Blair, West Virginia were the subject of a 1998 US News and World Report story "Shear Madness" by Penny Loeb. The story documented the impacts of mountaintop removal on communities close to the mines and their subsequent depopulation. A landmark 1999 lawsuit brought by the West Virginia Highlands Conservancy, Bragg v. Robertson was the first successful citizen lawsuit to stop Arch's proposed mountaintop removal valley fill. The fill would have buried several miles of stream at Pigeon Roost Hollow near Blair, West Virginia.
In his ruling for the plaintiffs, Judge Charles H. Haden stated that "If there is any life form that cannot acclimate to life deep in a rubble pile, it is eliminated. No effect on related environmental values is more adverse than obliteration...Under a valley fill the water quality of the stream becomes zero. Because there is no stream, there is no water quality."
Arch Coal's West Virginia mining operations in the Appalachian Mountains were the subject of a critical documentary in 2002 on Now with Bill Moyers on PBS.
On October 16, 2009, the EPA announced that it planned to use its authority to halt the permit for Mingo Logan Coal's Spruce No. 1 mine, which is owned by Arch Coal. The agency said it was acting on its authority for the first time since the Clean Water Act was enacted in 1972. The project at issue would be the largest authorized mountaintop removal operation in Appalachia. In a letter to the Army Corps of Engineers, EPA Regional Administrator William Early said the action "reflects the magnitude and scale of anticipated direct, indirect, and cumulative adverse environmental impacts associated with this mountaintop removal mining operation."
However, on January 5, 2010, a federal court in West Virginia agreed to extend a deadline for discussions with Arch Coal Inc.'s Mingo Logan Mining Co. about the mine's permit, which was halted in October.
CONSOL Energy Inc
CONSOL Energy Inc. (NYSE: CNX) is the largest producer of high-Btu bituminous coal in the United States. CONSOL Energy has evolved from a single-fuel mining company into a multi-energy producer of both high-Btu coal and gas.
James River Coal Company
James River Coal Company mines and sells bituminous, steam and industrial-grade coal through six operating subsidiaries located throughout Eastern Kentucky and Southern Indiana. They are the sixth largest coal producer in Central Appalachia and the third largest in the Illinois Basin.
TECO Energy Inc
TECO Energy is an S&P 500 energy company headquartered in Tampa, Florida. TECO Energy's four business units include Tampa Electric, a regulated electric utility serving nearly 667,000 customers in West Central Florida; Peoples Gas System, Florida's largest natural gas distribution utility; TECO Coal, producer of coal in Kentucky and Virginia; and TECO Guatemala, owner of two power plants and an interest in Guatemala's largest distribution utility. TECO Energy is traded on the New York Stock Exchange under the symbol TE.
Radio Munda Real interview of Paul Corbit Brown, from the Keepers of the Mountain Foundation
Friends of the Earth France are together with Action Aid France and CRID for the seventh year in 2014 organizing the “Sustainable Development Pinocchio Awards” and has nominated the company “Crédit Agricole” as one of the three companies in the category ”One for all, all for me!” – a category that is awarded to the company that has the most aggressive policy in terms of land grabbing, exploitation or destruction of natural resources. Crédit Agricole has been nominated for its financing of the destruction of the Appalachians Mountains.