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Wyoming’s Powder River Basin has produced the lion’s share of America’s thermal coal over recent decades. At its peak, coal directly employed nearly 7,000 workers and another 16,000 related jobs. Clearly, since the late 1970s Wyoming’s coal economy has been a boon to her citizens.

But markets changed, management miscalculated and the corporations that grew the Powder River Basin economy began to fail. In 2015-2016, the three largest mining companies in Wyoming — Alpha, Peabody and Arch — filed Chapter 11 bankruptcies. In late 2018, another large company, Westmoreland, filed. And at this writing, the last of the big miners, Cloud Peak, is on the verge of throwing in the towel. They have granted their executives the usual “retention” bonuses, eliminated retiree health care and pensions, hired a financial adviser and been delisted from the New York Stock Exchange.

These recent events in Wyoming eerily reflect Appalachia’s sobering history where the region’s landscapes and communities were devastated by mining. Now, bad actors from Appalachia are acquiring our critical coal mining assets, one by one. Our miners, communities and lands are in danger of being impoverished by these vulture operators and their schemes.

When a mining company reorganizes through bankruptcy, its ties to workers, communities and Wyoming begin to unravel. Typically, mining corporations entering Chapter 11 stop paying health care expenses of retirees, eliminate pensions owed to miners, often fail to pay county ad valorem taxes on coal production and strive to reduce or escape their reclamation and clean-up obligations.

The most ominous downside of large mining corporations leaving Wyoming is the risky entrepreneurs who move in and take over the mines. It’s not unfair to term them “financial engineers” or “vulture capitalists” who seek to bleed the mines’ remaining assets and escape liabilities that have accrued over the years. They are not strangers to the world of litigation, serial bankruptcies and corporate manipulation. Their safety and environmental records are seldom clean. These are not the operators or neighbors one would normally invite into the neighborhood.

When Alpha Natural Resources “reorganized” out of bankruptcy, they transferred the Eagle Butte and Belle Ayr mines to Contura, a company formed by their creditors. Contura paid Blackjewel, LLC $21 million to take over these mines and assume their tax and clean-up liabilities. This outfit was created by an Appalachian coal miner named Jeff Hoops, whose companies hold hundreds of small coal mine permits in Kentucky, Virginia and West Virginia, and whose mines have booked scores of safety and environmental violations over the years, including many deemed serious by state regulators from Appalachia. Blackjewel also owes Campbell County over $16 million in delinquent production and property taxes for 2017 and 2018. Just this week they worked out a payment plan with Campbell County, but it remains to be seen if the company will follow through.

In December, 150 year-old Westmoreland Coal Company filed bankruptcy and agreed to sell its Kemmerer mine to an infamous vulture investor named Tom Clarke, through his latest shell company, Western Coal Acquisitions, LLC. Clarke, a failed nursing home entrepreneur who began dabbling in Appalachian coal mine acquisitions a few years ago, has now turned his attentions west. By rough count, Mr. Clarke’s colorful career has led him to participate in at least ten separate bankruptcy cases. He has recently purchased several iron and coal mines out of bankruptcies, most of which have failed or promise to fail soon.

Yet, Clarke’s bid for the Kemmerer mine was accepted by the bankruptcy court, and he was allowed to escape Westmoreland’s union mining contract and stop paying retirees’ heath care and pension benefits. But surprise, surprise; Clarke has not been able to provide acceptable bonds to assure that the mine will be reclaimed when mining is finished. This leaves Westmoreland still liable and calls into question the mine sale agreement. Mostly, it leaves the future of Kemmerer’s 300 union miners, the nearby Naughton power plant and the whole town of Kemmerer up in the air.

The pattern evident in these past events is very troubling. Wyoming’s state and local governments need to connect the dots and set a course to somehow better control the entities that so greatly affect our workers and communities. It is vitally important that the state and county governments participate early and aggressively in bankruptcy proceedings to ensure that workers’ rights, fair payments for public services delivered and assurance of mine clean-up are protected. And it’s important that all government entities carefully vet outsiders with development schemes that seem too good to be true. We must not become a feeding ground for grifters and vulture capitalists who would leave Wyoming taxpayers on the hook for clean-up and reclamation costs.

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Bob LeResche is a Board Member of the Powder River Basin Resource Council. He is a former Commissioner of Natural Resources of Alaska, energy executive and investment banker. He and his wife Carol own a ranch and organic heirloom vegetable farm near Clearmont, Wyoming.

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