Ecology + Justice + Culture in the American South

Blackjewel left coal miners without pay. Now it might leave Appalachia thousands of acres of land to clean up.

For nearly a month, coal miners and their families have been blocking a coal train in protest of their employer, Blackjewel, which owes them paychecks since it went bankrupt. Credit: Mason Adams

On a hot morning in late July, coal miner Jeffrey Willig sat in the shade of a tent as his six children played next to the train tracks in Cumberland, Kentucky, where a pickup truck blocked a coal train. Willig and many other miners had lost their jobs nearly a month before when Revelation Energy and Blackjewel, two of the most powerful coal companies in the U.S., abruptly filed for bankruptcy. 

Willig worked in Revelation’s Cloverlick 3 mine in Harlan County for years. Before Revelation, he worked for Alpha Natural Resources, and before that, for Black Mountain Resources, an Alpha subsidiary once owned by Massey Energy, another major coal company. Willig was in the mines when Alpha went bankrupt in 2015 — but that was different, he said. 

Many Revelation and Blackjewel miners’ paychecks, which were already in their bank accounts, were taken out when the companies filed bankruptcy. Some families had already paid their monthly bills, and they overdrafted. “See, when Alpha shut us down, they still paid us for six months,” Willig said. “They didn’t just leave us like, ‘Hey, here you go, you’re done.’”

On July 29, Willig and other miners blocked the tracks after hearing that a crew was loading a train car with more than $1 million worth of coal to ship out. It’s been nearly a month, and miners, including Willig, are still on the tracks. 

“I just want to see us get paid what we worked for,” Willig said on the second day of the blockade. “I’m not expecting for us to get our jobs back. It’s plain and simple. Usually when you make a stand like this, you’re not going to get a callback, so I’m not expecting that.”

The Revelation and Blackjewel bankruptcies put nearly 1,700 miners out of work across Kentucky, Virginia, West Virginia, and Wyoming. The companies owe $11.8 million in back pay and benefits to miners in central Appalachia, according to Ohio Valley ReSource. But those costs pale in comparison to the more than half a billion dollars Blackjewel owes for other debts, according to its bankruptcy filing, including significant environmental and employee obligations. 

Surface mining, a type of mining that Blackjewel and other coal companies use, has degraded land and water in Appalachia, causing erosion and landslides, floods, and water contamination. Without reclamation, sites are more of an environmental and economic risk. The Surface Mining Control and Reclamation Act (SMCRA) of 1977 set rules for restoring surface-mined land through a process called reclamation, which consists of rebuilding ridges destroyed by explosives, remediating soil, planting new trees and vegetation, and ensuring that land can be used for other purposes. 

As the coal industry has declined over the last decade, companies have used loopholes in SMCRA to avoid reclamation obligations, and some state agencies have not adequately enforced the law. Alpha and other companies dumped unproductive mines and responsibilities on companies that bought them after bankruptcy, postponing cleanup for months, years, or even decades. Many of the mines at stake in Blackjewel’s bankruptcy produce little coal, are lying idle, or are in various stages of reclamation.

Advocates, industry experts, and former regulators say this cycle — mine, declare bankruptcy, and sell — threatens the system designed to ensure mines are reclaimed, and that central Appalachia could see a new round of mine abandonment that could cause more environmental, economic, and health problems.

“There are parts of West Virginia, Pennsylvania, and Kentucky — the state with the most abandoned mine lands in the country — that were mined 50, 100, 150 years ago, and still have not been reclaimed,” said Joe Pizarchik, director of the federal Office of Surface Mining Reclamation and Enforcement (OSMRE) under former President Barack Obama. “Those areas have still not recovered. The coal’s gone, there’s no jobs, there’s nothing.”

Barren, gray ridges mark the only remains of many mountaintops along the Kentucky and Virginia state line near where miners are protesting. Revelation holds mining permits on much of this land, which sit in various states of mining and reclamation. They’re part of the roughly 2,278 square miles of surface-mined land in central Appalachia. According to a 2015 study, only about half have been reclaimed. 

Forty-two years ago, SMCRA established a fund coal companies pay into to restore land mined before 1977 that degraded the environment or endangered the public. It also set rules for how companies restore land mined after 1977. Surface mines are shaped to the approximate contour of the mountain and revegetated with soil, grass, and often non-native shrubs like autumn olive. 

Environmental groups say rules aren’t stringent enough. “Having some of the open areas grass-seeded and stable is better than nothing, but it’s not great from an economic perspective and an environmental perspective,” said Erin Savage, central Appalachian program manager for advocacy group Appalachian Voices. 

A surface mine site near Patridge, Kentucky. Credit: Mason Adams

Aside from being eyesores, sites that aren’t properly reclaimed can be dangerous for communities around them. In 2010, a former mine in eastern Kentucky being mined without a permit eroded during a flood event and destroyed homes. A community near a large surface mine in West Virginia has been largely abandoned by residents. A Kentucky mine owned by West Virginia Gov. Jim Justice that was supposed to be reclaimed in 2015 has repeatedly led to flood damage. There’s also the risk of long-term degradation of water quality — which is common throughout Appalachia — from acid mine drainage and other toxic runoff that can contaminate waterways.

The federal government regulates mine reclamation in Tennessee, but Kentucky, Virginia, and West Virginia have state agencies. To ensure that states can cover cleanup costs if coal operators don’t, they’re required to set aside reclamation money in bonds through third-party companies, collateral, or by self-bonding, a process that allows them to promise regulators they’ll cover expenses without setting aside money upfront. 

Each state’s system works differently: Virginia charges per-acre, plus a tax on every ton of coal that goes into a collective pool of money for the state to put toward reclamation; West Virginia requires coal companies pay between $1,000 and $5,000 per acre, plus a tax on coal production that goes into the shared pool. Kentucky overhauled its system after a 2011 federal study found that not even a third of bonds covered the cost of reclaiming land. But Kentucky regulators still tried to lower the amount coal companies must set aside for water treatment after mining.

State bonding policies have been weakened as some regulators try to accommodate the struggling coal industry. “It’s not unusual to have a state regulator who did not stay on top of things, and then try to get as much reclamation as possible or to keep the jobs going,” said former federal regulator Pizarchik. “They know they’ve got a major problem on their hands and try to get as much reclamation out of the company as they can before it finally collapse.”

Between 2012 and 2017, four of the U.S.’s largest coal companies — Alpha, Arch Coal, Patriot Coal, and Peabody Energy — filed for Chapter 11 bankruptcy and left nearly $5.2 billion owed for miner benefits and requirements to restore mined land, according to a study in the Stanford Law Review. The companies used several techniques to get out of paying: they rejected health care and pension obligations, passed regulatory liabilities to successor companies, and when those companies liquidated, abandoned them altogether. 

Jeff Hoops, who led Blackjewel, Revelation, and Lexington Coal, built his companies on mines passed through bankruptcies. Blackjewel’s holdings consist almost entirely of mines that have been through bankruptcy, and in 2017 Alpha paid him $316 million for Lexington Coal to take nearly 300 mines, many of which needed extensive reclamation. Hoops was pushed out as Blackjewel’s CEO shortly after it filed for bankruptcy, but he and companies his family owns are seeking payments of more than $22 million, according to one analysis.

A sign shows some of Revelation’s mine permits in Eastern Kentucky. Credit: Mason Adams

Blackjewel’s lawyer told a judge in July that there may not be another round of buyers for some mines, particularly in central Appalachia. Three mines — two in Wyoming and one in West Virginia — were sold to Contura, an Alpha subsidiary, and other companies have placed bids. But some Appalachian mines backed up by $200 million or more in reclamation bonds failed to sell, according to one of the companies insuring Blackjewel’s bonds, and some have cleanup costs that are likely to far exceed that amount. The responsibility for reclamation falls to whoever buys them — and if they can’t be sold, it could fall to state agencies and taxpayers. 

“This Revelation/Blackjewel filing is the beginning of phase 2 of the coal bankruptcy cycle, and it’s going to be devastating,” said Peter Morgan, a Sierra Club senior attorney. 

An analysis of Blackjewel’s Appalachian mining permits found the company held 211 in Kentucky, 69 in Virginia, 12 in West Virginia, and two in Tennessee — more than 14,000 acres. Savage, who conducted the analysis, said that most likely can’t generate revenue. 

“How is a company going to take these over and do any better job reclaiming them?” Savage said. “Who’s going to take over these permits, even if they were just handed to them? They’ve got all this reclamation liability. If Blackjewel couldn’t do it, why would a different company be able to do better?”

On the second day of the protest in Cumberland, State Representative Adam Bowling talked to miners between games of cornhole. He said he planned to file legislation to make sure that unpaid workers were compensated, and is concerned about the fate of Kentucky’s mines. 

“You don’t want a pit sitting there after they’re done, after they get up and leave,” he said. “Nobody wants that. We don’t want that in our communities. We enjoy coal mining. We enjoy that it’s a wage that allows our families to eat, but nobody wants them to get up and leave out of town and leave the liabilities behind.”

Some regulators are trying to address the reclamation gap. Virginia offers compliance plans to address mine violations and overdue fines. Revelation was on a compliance plan when Blackjewel declared bankruptcy. Tarah Kesterson, a spokeswoman for Virginia’s Department of Mines, Minerals, and Energy, said that since August 1, the agency has moved to forfeit bonds on one Blackjewel and four Revelation mines. The agency is waiting for an update before taking any action.

Miners and others from local communities pray on the second day of a protest blocking a coal train in Cumberland, Kentucky. Credit: Mason Adams

The cleanup of abandoned mines around the U.S. from before 1977 will cost billions of dollars, but there’s no clear consensus of the actual amount. A lack of data on more recently mined land makes it harder to determine what the full costs will be. Williams-Derry said that post-1977 mine abandonment is not something “that coal country has adequately wrestled with.”

“Thinking about all this liability and environmental responsibility, we’ve just assumed there’d be some part of the industry left over that would pay for something,” Williams-Derry said. “We’re at a time right now when the whole industry is shrinking, and there may be assets that nobody wants, and there’s nobody anywhere left to pay for clean-up.”

Some advocacy groups want state regulators to take a much more aggressive role in enforcing reclamation, but the Republicans who tend to control political power in coal regions are often reluctant to do so. Some state lawmakers have tried to secure back pay for miners blocking the train in Cumberland, and to ensure companies set aside money for paychecks. But bills to retain miners’ benefits and use existing funding to reclaim abandoned mine lands with economic development plans in mind have been stalled in Congress for years. U.S. Rep. Matt Cartwright, D-Pennsylvania, said he plans to introduce a measure to eliminate self-bonding and to reform other bonding programs. 

“The slew of recent bankruptcies in the coal industry has put current and former coal communities at risk,” Cartwright said in a statement to Southerly. “We need to make sure we have the resources needed to clean up and restore abandoned mines.” 

As more powerful coal companies go bankrupt, the fate of thousands of acres of mines in central Appalachia — and the communities they surround — hangs in the balance.

“This is a slow-motion car wreck,” said Savage. “There’s just too much reclamation and not enough demand. Too much of the reclamation has been put off in hopes of some magical rebound that just isn’t going to happen.”

Mason Adams is a journalist based in southwest Virginia. Follow him on Twitter.

This story was supported by the Even T Collinsworth Jr Memorial Fund.