Arch Coal’s Mingo Logan unit seeks to lift legal stay

Saying the legal fight in other courts is not necessarily over, the U.S. Department of Justice told a federal judge in West Virginia that he should take no action on a motion by the Mingo Logan Coal unit of Arch Coal (NYSE: ACI) to lift a stay related to the Spruce No. 1 strip job in Logan County, W.Va.

On March 23, a judge at the U.S. District Court for the District of Columbia threw out the U.S. Environmental Protection Agency’s January 2011 veto of a Section 404 Clean Water Act permit that the U.S. Army Corps of Engineers had issued to Mingo Logan for Spruce No. 1. Judge Robert Chambers, overseeing a separate legal case at the U.S. District Court for the Southern District of West Virginia, had previously stayed the West Virginia case while the case in the D.C. court was fought out. With the March 23 decision in hand, Mingo Logan Coal is now asking Chambers to lift the stay in the West Virginia case.

On April 20, Justice filed arguments with Chambers against a lifting of the stay. “Notwithstanding the recent decision in the District Court for the District of Columbia, the stay should be continued to maintain the status quo until all appeals have been exhausted or the right to appeal has expired,” Justice argued.

Justice said the D.C. court’s decision is subject to appellate review and will not be final until all appeals have been exhausted or the time for appeal has expired. The federal government is considering whether to appeal that judgment and to seek a stay of the judgment pending appeal. But, in the interim, the EPA’s permit veto is vacated and, but for the challenge pending in this court, Mingo Logan could proceed with filling the streams that are the subject of EPA’s veto.

The challenge to the Spruce No. 1 permit was filed in the West Virginia court in January 2007 by Ohio Valley Environmental Coalition (OVEC). Shortly after the complaint was filed, OVEC and Mingo Logan entered into an agreement in which Mingo Logan agreed to limit its activity as authorized by the permit to specified areas identified in the agreement. All waters of the United States that are subject to the EPA veto are subject to that agreement and thus cannot be filled absent a 20-day notice. That agreement remains in effect and Mingo Logan has not given the 20-day notice, Justice said in the April 20 filing. “Moreover, on information and belief, Mingo Logan is continuing to mine in the areas specified in the agreement and has sufficient work in those areas to keep the mine operating until at least the end of this year,” Justice added.

Mingo Logan is seeking to lift the stay in this case in order to resume litigation on its pending motion for summary judgment, the Corps said. If the court were to order the resumption of the litigation, and ultimately were to grant Mingo Logan’s motion for summary judgment, Mingo Logan would be relieved from the terms of the notice agreement with Plaintiffs. Mingo Logan would then be free to fill the waters of the United States as authorized by the permit, including those waters that are subject to EPA’s veto.

In its April 5 argument to lift the stay, Mingo Logan said: “The Corps issued its permit to Mingo Logan over five (5) years ago. OVEC’s challenge to the permit has been pending all that time, and this Court has stayed the case for over two and one-half years. Any continued stay would be precisely the type of ‘immoderate’ stay courts have uniformly rejected as an abuse of discretion.”

Mingo Logan added: “USEPA participated in a lengthy permit review process that took the better part of a decade. It did not object when the Corps issued the permit in January 2007. It did not object when Mingo Logan started to mine. It has not gathered or requested any information from Mingo Logan to determine whether any impacts have resulted from over three years of mining that have already occurred under the Spruce No. 1 Permit. It has never rebutted the Corps’ determination that Mingo Logan’s operations have been conducted in compliance with the § 404 permit. Its belated political decision to exercise its § 404(c) authority has been rejected as untimely and illegal. There simply is no reason to deny Mingo Logan the right to a resolution of its outstanding motion for summary judgment.”

Arch has had Eagle Creek Mining LLC, controlled by coal operators John and Thomas Potter, working the legally allowed areas of the Spruce No. 1 mine. U.S. Mine Safety and Health Administration data shows the mine produced 819,831 tons in 2011 and 591,076 tons in 2010.

As part of previous efforts to appease environmental critics, Arch cut the original permit area for the mine from 3,113 acres to a current 2,278 acres, and also agreed to limit the number of coal seams it would work within the permitted area to minimize the creation of interburden that goes into on-site streams.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.