CHARLESTON, W.Va. — The state DEP reached an agreement with Patriot Coal Tuesday that will set aside more than $50 million for the coal company’s environmental cleanup responsibilities.
The agreement, which is subject to bankruptcy court approval, will allow reclamation of Patriot’s legacy liability sites in northcentral and southern West Virginia and ensure that many of Patriot’s miners stay employed.
“Without this deal, Patriot could walk away from its reclamation obligations and leave that work to the state,” said DEP Cabinet Secretary Randy Huffman. “The DEP’s aggressive bankruptcy strategy ensures that significant funding will be provided for reclamation over and above the amount of Patriot’s mining bonds.”
Patriot announced in June that it would sell substantially all of its ongoing operations to Blackhawk Mining as part of a proposed bankruptcy plan.
Under the agreement, the surety bonds Patriot posted to obtain its mining permits will remain in place, but Patriot will post an additional $12.5 million as financial assurance for its reclamation and water treatment obligations statewide. Blackhawk also agreed to provide $7.5 million of reclamation services on Patriot’s former mining sites.
“This deal is a win-win for West Virginia, “said Huffman. “Fifty million dollars in additional funds will be devoted to reclaiming Patriot’s former mine sites, and a large portion of Patriot’s existing workforce, both union and nonunion, will continue to be employed in that effort.”
The agreement is pending the approval of Patriot’s bankruptcy plan in court, the sale to Blackhawk and and the transfer to Virginia Conservation Legacy Fund.
Pending approvals, the plan should be complete on Oct. 23.