Coal Age

APR 2016

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While the legislators did not indicate any specific wireless system, they did note that only a few federal field offices cur- rently have the next-generation technology. "MSHA currently has several field offices with federal mine res- cue capabilities, including in Beckley, West Virginia, but only two of MSHA's locations in Pittsburgh and in Denver have fully equipped wireless mine safety communications and tracking systems that can significantly reduce response time after mining accidents," they said, citing recent examples of incidents in Colorado, Texas and Indiana. "Rescue operations, which once took days, now can be completed in hours if equipment and teams are readily available." There are currently more than 300 active mine rescue teams (federal, state and private) in the U.S., and there are multiple MSHA-approved wireless and communications systems available thanks in part to the implementation of the MINER Act of 2006. Illinois AG Asks Peabody to Prove Reclamation Ability Illinois Attorney General Lisa Madigan has issued a communi- cation to Peabody Energy that calls on the producer to release its financial information publicly and explain how it intends to cover $92 million in reclamation costs should the St. Louis- based company enter bankruptcy as it has warned. On March 21, Madigan issued the letter to Peabody Energy as well as Peabody Investments Corp. asking it to address plans it has committed to regarding the cleanup of several active and inactive operations in the southern region of the state; in it, she noted that she has "significant concerns" about its ability to fulfill its self-bonding. The mines included in its commitment are the active Cottage Grove mine; the active Wildcat Hills mine; the inactive Big Ridge mine; the inactive Eagle Valley mine; and the inactive Willow Lake mine in Equality, Saline County. Also tied into the agree- ment is the active Gateway mine in Coulterville, Randolph County, and the Riola/Vermilion Grove mines, inactive opera- tions in Georgetown, Vermilion County. Madigan stressed that reclamation at those sites is necessary to protect the public water supply into the future. "Because Peabody's $92 million in mine reclamation com- mitments are critical to the state and many communities in Illinois, I am requesting that Peabody publicly disclose financial information to allow legislators, local officials, and residents in potentially impacted communities to assess whether Peabody can fulfill those financial responsibilities," she said. Company officials have not commented on the specifics of Madigan's letter, but in a statement said, "We see our land restoration as an essential part of the mining process, and take great pride in the work that we do. We have been routinely rec- ognized for these programs. Each year, we restore thousands of acres into hardy and productive rangeland, wildlife habitat, hardwood forests and wetlands." Peabody warned earlier this month that it may seek Chapter 11 bankruptcy protection, but so far has not done so. Should that plan go forward, a judge will be tasked with prioritizing liabilities, including those costs, as they are not guaranteed by any securities. Judge Rules Rosebud Water Permit Invalid A district judge in Montana is ordering state reconsideration of a water discharge permit for Western Energy's Rosebud strip mine in southeastern Montana, calling the application "invalid" because regulators did not fully examine its environmental impacts. According to the Associated Press, Judge Kathy Seeley ordered the Montana Department of Environmental Quality (DEQ) to re-review the hotly contested permit in her March 14 decision because of the agency's "clear errors in judgment." Specifically, she said, the pollution impact to several neigh- boring waterways had not been given proper consideration, as the DEQ had allowed reduced monitoring for those bodies and also reclassified them so that they would be governed by less strict regulatory outlines. The Rosebud complex in Colstrip, Rosebud County, pro- duces about 9 million tons annually. A majority of its output feeds the Colstrip power plant. Western Energy's parent compa- ny is Westmoreland Coal. Another proposal for a 12-million-ton expansion of the Rosebud mine is still pending review by the Montana Board of Environmental review, the AP noted, as that agency was await- ing Seeley's judgment. Kentucky Senate Passes Bill to Stop State Inspections The Kentucky Senate has given the greenlight to Senate Bill 297, which will put an end to the state's mine inspection program and turn those duties over to federal officials. The proposal passed 25-11 before the group, which is Republican-controlled. Bill sponsor Sen. Chris Girdler said the cost-saving bill will end duplication of efforts between state and federal inspectors and will make the two groups complementary to one another by converting 62 state inspectors to "safety analysts" tasked with correcting subpar practices through "behavior modification" rather than issuing citations. "I'm for the free markets along with rational oversight decid- ing what is most efficient, not the government picking winners and losers," Girdler said. "That is exactly what we have seen occur over the last eight years — burdensome regulations, gotcha games and an administration that makes no bones about wanting to put the coal industry out of business. I call it stran- gulation by regulation." To date, more than 10,000 coal mining jobs have been cut in Kentucky, or 56% of direct employment. Production in the state now hovers around its lowest since the mid-1950s, and the legisla- tor said eastern Kentucky just mined its lowest level since 1932. Currently, all underground Kentucky coal operations are evaluated at least six times annually, and all others are exam- ined at least two a year. Sen. Stephen West, a supporter of the bill, noted that Kentucky has just 130 remaining mines after 318 operational closures over 18 months. The remaining active complexes just were not enough to justify 62 state inspectors, he added. "[T]he war on coal has been tremendously successful," he said. "At one time, we had thousands of mines in this state." SB 297 now goes to the state House of Representatives for consideration. Armstrong Sees Rise in Earnings in 4Q of 2015 Despite a 20% decline in revenue, Illinois Basin (ILB) high-sulfur steam coal producer Armstrong Energy Inc. was able to generate strong EBITDA of $8.45/ton in the fourth quarter of 2015, an n e w s c o n t i n u e d 16 www.coalage.com April 2016

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