Federal judge orders halt at TECO Coal mining operation

In an unusually chatty order, Judge Amul Thapar on June 13 called a halt, through a preliminary injunction, to coal mining by the Premier Elkhorn Coal unit of TECO Coal on a property where not all property owners had agreed to that mining.

“Property rights matter,” wrote Thapar, who sits in the U.S. District Court for the Eastern District of Kentucky. “So too do the efforts of coal companies: They offer employment to millions and provide affordable energy to consumers. Sometimes, a company’s interest in conducting mining operations will leave it at odds with the owner of the surface estate. In such situations, should the law prefer the surface owner or the coal company? The Constitution wisely leaves such questions of policy to the States and the elected branches, not the Courts. And here, the States and the political branches have spoken with one voice: Coal companies must comply with certain minimum permitting requirements before they may mine a surface owner’s estate. Because the coal company in this case failed to comply with those minimum requirements, it must immediately cease mining the plaintiff’s land.”

The plaintiff in this case, M.L. Johnson Family Properties LLC, is a collection of landowners who want Premier Elkhorn Coal to cease surface mining operations on their property. To that end, they filed this suit on May 14 against the Secretary of the Interior, seeking an injunction ordering her to halt Elkhorn’s mining activities. Although Elkhorn obtained a permit from the state of Kentucky, the plaintiff claims that the permit fails to comply with the minimum federal requirements governing surface mining under the 1977 Surface Mining Control and Reclamation Act.

The judge noted that the six individuals who are members of the plaintiff in this case hold a majority of the parcel as tenants-in-common, and they never consented to the surface mining of their land. Pike-Letcher Land Co. owns 25% of the parcel as a tenant-in-common with the plaintiff, and it expressly consented to surface mining.

“At first blush, the Act is silent on this score,” wrote the judge about needed mining consents. “It envisions only ‘the surface owner.’ Nevertheless, well-established canons of statutory interpretation all point to the same conclusion: Subsection (A) requires the consent of all surface owners. The consent of “a” surface owner does not suffice.”

After a site inspection, the Secretary will have to decide whether to order a cessation of Elkhorn’s operation. The court cannot order her to require cessation at this point, because that determination must be made after the inspection, the judge wrote. “In the interim, the Court will grant the plaintiff’s motion for a preliminary injunction, staying Elkhorn’s mining operation on the plaintiff’s property.”

Premier Elkhorn argued in a June 4 filing that the mining permit was not illegally issued and that it is pursuing a permit revision with the state that adds more information about rights on the subject property.

Premier Elkhorn’s permit No. 898-0944, which was issued in October 2013, covers 370.8 acres on Sycamore Branch and Bob’s Branch in Pike County, Ky. The plaintiff is a co-tenant with Pike-Letcher Land Co. (PLLC) in a 265-acre surface tract on Bob’s Branch of which 6 acres was included in the permit as originally issued. PLLC is an affiliated company with Premier Elkhorn and both are subsidiaries of TECO Coal, which is in turn a subsidiary of TECO Energy (NYSE: TE), a Florida-based utility holding company. The company said its mining plan for this property going forward involves an average of 25,000 tons per month of production.

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.