Bluestone Coal sues Pinnacle Mining over water inundation at West Virginia mine

Bluestone Coal and Double-Bonus Mining filed an April 16 lawsuit at the U.S. District Court for the Southern District of West Virginia against the Pinnacle Mining Co. LLC unit of Cliffs Natural Resources over an allegation that Pinnacle’s mining operations damaged overlying assets of the plaintiff companies.

Bluestone is the permit holder for underground coal mining operations at Mine No. 65 located in Wyoming County. Coal Mine No. 65 operates within the Little Fire Creek coal seam. Operating rights under the relevant permits have been assigned to Double-Bonus.

The Pinnacle longwall mine is located several hundred feet below the level of the Bluestone/Double-Bonus Mine No. 65. In early 2013, Pinnacle contacted Bluestone and Double-Bonus seeking permission to drill a vertical borehole shaft from the surface through a void (or inactive) area of Mine No. 65 that was located in a sealed-off area in the “2nd Right” portion of the mine, said the lawsuit.

The borehole shaft was to be used to install a vertical dewatering system to assist Pinnacle with the control of water in the Pinnacle Mine located approximately 420 feet below Mine No. 65. The vertical dewatering system would include not only drilling the borehole through Mine No. 65 to the Pinnacle Mine below, but also installing casings, pipes, pumps and other appurtenances for the system to pump water from the Pinnacle Mine to the surface.

Pinnacle or its agents prepared and submitted the necessary paperwork with U.S. Mine Safety and Health Administration (MSHA) to conduct the borehole drilling. MSHA approval was necessary because the drilling would necessarily run the risk of fracturing or damaging the strata above Mine No. 65, which could allow the incursion of gases or water into the void areas of the mine endangering personnel in the Bluestone/Double-Bonus mine.

The hole was filled, then in March of this year, Bluestone/Double-Bonus said they became aware of a “dramatic increase” in the amount of water behind the sealed areas of its mine. Water began to bypass the existing barriers and seals. “The Pinnacle borehole-drilling project is the sole proximate cause of the dramatic change in the water conditions within the mine,” said the lawsuit. “On or about April 2, 2015, while Double-Bonus was actively engaged in preparing the Mine for quick start-up operations, MSHA issued a ‘107 A Order’ for the mine, requiring Plaintiffs to cease operations because of the risks and dangers posed to mine personnel. In conjunction with the appropriate regulatory agencies, Plaintiffs have been working under modified provisions of the ‘107 A Order’ in an attempt to prevent the loss of the mine, in-place equipment, and coal reserves.

“Although the economic loss attributable to the loss of Mine No. 65 and its attendant reserves has not been precisely calculated, the potential economic loss and impact on the Plaintiffs and the local community are likely to be in the millions of dollars. On or about April 6, 2015, Plaintiffs, by counsel, notified Pinnacle’s existing counsel of the situation and, among other things, requested that counsel notify Pinnacle of a potential claim and requested that all evidence relating to the borehole project be preserved. Because of the likelihood that the borehole was negligently or incorrectly completed, Plaintiffs asked that Pinnacle immediately provide them with all logs, records, reports and other records relating to the project.

“On April 14, 2015, Plaintiffs became aware that there was activity at the surface location of the borehole. Plaintiffs, by counsel, immediately contacted Pinnacle’s counsel so as to notify Pinnacle that under the circumstances any activity concerning the borehole could not only constitute the destruction or spoliation of evidence, but also cause further damage to the mine. Plaintiffs requested that Pinnacle voluntarily cease and desist from all activity regarding the subject borehole. On April 15, 2015, Pinnacle, through a letter issued by its counsel, stated that it would not honor the Plaintiffs’ request to cease activity regarding the borehole and that it intended to proceed with the placement of a surface pump and/or piping into the diameter of the borehole.”

Bluestone/Double-Bonus said they want this surface activity halted while the issues of the case are argued. “Given that Pinnacle drilled the borehole in February 2014 and waited more than a year until April 2015 to take further action to install its dewatering system, the amount of prejudice that Pinnacle may incur as a result of a temporary restraining order or temporary injunction will be minimal or non-existent,” they wrote.

Their motion for a temporary restraining order is scheduled for hearing on April 20 before Judge Irene C. Berger.

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.