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Conservation groups ask feds to investigate Westmoreland's cleanup funds


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Conservation groups ask feds to investigate Westmoreland's cleanup funds

Conservation groups asked a federal agency that regulates coal mining to investigate whether Westmoreland Coal Co. lacks sufficient bonds to cover the costs of cleaning up its mines if it goes out of business.

In a joint letter to the U.S. Office of Surface Mining Reclamation and Enforcement, the groups said Westmoreland's most recent annual report shows $672.7 million of reclamation bonds for its mining operations but estimates that the full cost of reclaiming the mines totals $772 million.

"This reinforces the notion that the company's current bond amounts may be insufficient to cover projected final reclamation costs at least at some of its mines," the Western Organization of Resource Councils, Northern Plains Resource Council and Powder River Basin Resource Council wrote May 14, asking the agency "to investigate the coal company's compliance with financial assurance regulations and to enforce compliance with reclamation bond requirements through the company's likely impending bankruptcy proceeding."

"Westmoreland has said they may file for bankruptcy in the near future. If they don't emerge from bankruptcy and the public finds out they are underbonded, then taxpayers would be stuck with the bill for cleanup," Western Organization of Resource Councils chair Beth Kaeding said in a May 16 release. "That's a big, unexpected financial burden on states and coal communities."

The coal producer operates mines in Montana, New Mexico, North Dakota, Ohio, Texas and Wyoming, as well as in Canada.

Westmoreland notified its investors April 2 that it may seek Chapter 11 bankruptcy protection or be subject to an involuntary petition for bankruptcy, and said its auditors have expressed "substantial doubt" about the company's ability to continue as a going concern.

The agency, which is a branch of the U.S. Department of the Interior, did not respond to a request for comment.