Peabody Energy May Be In Violation Of Coal Regs In Three States

Feb 17, 2016

The federal government notified regulators in Wyoming, Colorado, and New Mexico this week that one of the world's largest coal companies may be out of compliance with coal mining regulations. 

The US Office of Surface Mining Reclamation and Enforcement (OSMRE) sent out the Ten-Day Notices in response to a citizen complaint from WildEarth Guardians. The environmental group alleges that Peabody Energy is mining coal without having sufficient reclamation bonding in place to make sure future mine clean-up gets done. The type of bonding in question is called self-bonding which is basically a guarantee, based on the company's own financial strength, that future coal mine reclamation will be paid for. WildEarth Guardians believes that Peabody no longer passes the required stress test. St. Louis-based Peabody Energy has around $900 million worth of self-bonds in Wyoming alone.   

According to OSMRE, Ten-Day Notices are sent out automatically whenever the bureau receives a citizen complaint. Wyoming regulators have gotten similar letters recently concerning two bankrupt coal companies- Alpha Natural Resources and Arch Coal. Peabody is still solvent but reported a $2 billion loss in 2015.  

In response to the Ten-Day Notice, regulators in Wyoming, Colorado, and New Mexico have two weeks to correct the possible problem or explain why there is no problem.