EPA terminates contested permit for a Peabody Energy coal mine in New Mexico

The U.S. Environmental Protection Agency’s Region 6 office told the federal Environmental Appeals Board that it is terminating an NPDES water permit that it issued to the Lee Ranch Coal unit of Peabody Energy (NYSE: BTU).

Lee Ranch Coal had in November 2014 appealed the permit, covering water runoff from its El Segundo strip mine in New Mexico, due to certain conditions that EPA put into the permit that the company says were unjustified. The permit termination now makes that appeal a “moot” point, EPA told the board. EPA said it is terminating the permit for the reasons stated in the company’s complaint.

EPA said it concedes that there is no evidence in the administrative record for this permit proceeding that there is the “reasonble potential” for a discharge of a pollutant under this permit. Other than asking that the board dismiss this case, EPA didn’t say what it plans to do from here, though the likely path is issuing a new permit that eliminates what it concedes are the contested issues.

In November 2014, Lee Ranch Coal filed a petition with the board seeking review of a National Pollutant Discharge Elimination System renewal permit that Region 6 had issued. The company is appealing a total dissolved solids (TDS) limit and a requirement to submit within six months of the permit being issued a Sediment Control Plan. The permit is for its El Segundo mine. The TDS limit was not in the original 2008 permit for this mining operation, which was initially developed around that time to supplement production from the nearby Lee Ranch strip mine. The limit is due to concerns about TDS in water runoff from the site impacting the San Juan River. EPA did not conduct a reasonable potential assessment of whether the mine’s runoff has this impact before imposing this new limit, the company said. The river is 100 miles away from the mine, Lee Ranch Coal pointed out. As for the Sediment Control Plan requirement, the company said there is no evidence to support the need for such a plan to be drawn up.

Said the Peabody website about this operation: “Located about 35 miles northwest of Grants, N.M., the Lee Ranch Mine supplies coal to power plants in New Mexico and Arizona. In 2008, Peabody opened the El Segundo Mine (which means ‘the Second’ in Spanish). The El Segundo Mine, adjacent to Lee Ranch, is the most productive U.S. mine outside of Wyoming’s Powder River Basin, with a low overburden-to-coal ratio and access to equipment from other operations.”

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.