Alpha sets up mine safety foundation under UBB settlement

Alpha Natural Resources (NYSE: ANR), which since June 2011 has been working to get its mine safety program installed in place of the troubled safety program at Massey Energy, announced May 14 the establishment of the Alpha Foundation for the Improvement of Mine Safety and Health Inc.

The foundation is a non-profit organization that has a mission to improve mine health and safety through funding projects by qualified academic institutions, not-for-profit entities and individuals associated with those entities. Alpha will contribute $48m to the foundation. 

Alpha has also appointed three directors to administer the foundation: Dr. Michael Karmis, Ph.D., Dr. David Wegman, M.D., M.Sc., and Dr. Keith Heasley, Ph.D. The three are experts in mine health and safety and come from diverse professional and academic backgrounds. The foundation plans to host a kick-off meeting this summer where the directors will discuss funding priorities. 

Kevin Crutchfield, CEO of Alpha, said: “The safety of our employees is the highest value of our company, and mine safety and health is imperative to the success of our industry. We are proud to establish and fund the Alpha Foundation and also appoint three leading experts to advance its objectives. This presents a tremendous opportunity to drive the latest developments and innovation in mine safety and health to the benefit of miners around the world.”

The Alpha Foundation was established under the company’s Non-Prosecution Agreement with the U.S. Attorney’s Office for the Southern District of West Virginia and the U.S. Department of Justice, entered into on Dec. 6, 2011. The directors were appointed with the approval of the U.S. Attorney’s Office.

  • Karmis is the Stonie Barker Professor of the Department of Mining and Minerals Engineering and the Director of the Virginia Center for Coal and Energy Research (VCCER) at Virginia Tech. He is an expert in the areas of rock mechanics and ground control, mining systems, and the sustainable development of energy and mineral resources.
  • Wegman is Professor Emeritus in the Department of Work Environment at the University of Massachusetts Lowell and Adjunct Professor at the Harvard School of Public Health and the University of Massachusetts Medical School. His epidemiologic research includes the study of acute and chronic occupational respiratory disease, occupational cancer risk and occupational musculoskeletal disorders, with special interests in the study of subjective outcomes as early indicators of health effects and in surveillance of occupational conditions and risks.
  • Heasley is a professor in the Department of Mining Engineering at West Virginia University, and is a licensed professional engineer and a registered professional engineer in West Virginia and Pennsylvania. His primary research interests are numerical modeling in rock mechanics, computer applications in mining, and multiple-seam mine design and ground control.

The December 2011 settlement with the Justice Dept. related to the April 2010 explosion that killed 29 miners at Massey Energy’s Upper Big Branch (UBB) deep mine in southern West Virginia. Alpha acquired Massey in June 2011 and since then has been trying to fix the troubled safety program at the former Massey mines and to deal with the legal, financial and regulatory fallout from the disaster.

The Non-Prosecution Agreement and a companion settlement resolve a criminal investigation and regulatory civil proceedings against Massey, but did not resolve any individual responsibilities related to the UBB tragedy. The Non-Prosecution Agreement reflects Alpha’s commitment:

  • to invest $80m over the next two years in added safety measures at legacy Massey mines and Alpha mines, including ongoing safety skills and compliance training, construction of a state-of-the-art safety training facility, and the development and installation of next-generation mine safety equipment;
  • to establish a $48m trust to fund research and development projects designed to improve mine health and safety;
  • to pay $46.5m to families of the fallen miners and two individuals affected by the UBB explosion, of which $16.5m has already been paid as part of or will be paid as part of settlements and anticipated settlements, in accordance with the Non-Prosecution Agreement;
  • to pay $34.8m in connection with the resolution of outstanding citations, violations, and orders related to MSHA’s investigation arising from the UBB explosion and other non-UBB related matters involving legacy Massey entities prior to Alpha’s acquisition of Massey on June 1, 2011.

With $7.1bn in total revenue in 2012, Alpha ranks as America’s second-largest coal producer by revenue and third-largest by production. Alpha is the nation’s largest supplier of metallurgical coal used in the steel-making process and is a major supplier of thermal coal to electric utilities and manufacturing industries. In 2012, the company had more than 200 customers on five continents.

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.