This article originally provided by The Courier-Journal

January 18, 2008

Massey to pay $20 million to settle with EPA

E. Ky. slurry spill spurred action

By James Bruggers
jbruggers@courier-journal.com
The Courier-Journal

A Virginia-based mining company has agreed to pay a $20 million civil penalty to settle allegations that it polluted hundreds of rivers and streams in Kentucky and West Virginia.

The penalty against Massey Energy stems from the massive, 300-million-gallon slurry spill in Martin County, Ky., in October 2000, often described as the southeastern United States' worst environmental disaster, as well as 4,500 violations of Clean Water Act permits at mines in the two states.

As part of the agreement, Massey could spend an additional $10 million to modernize pollution controls at all its mines in Kentucky, West Virginia and Virginia, according to the U.S. Environmental Protection Agency. The EPA says the company operates about 33 underground mines and 11 surface mines in the three states.

The fine is the largest the EPA has ever collected under its wastewater permit program, said Robert Klepp, an EPA attorney who worked on the case.

"This is a landmark case, and it is one that is very important for the citizens of West Virginia and Kentucky," Klepp said.

When asked whether it will result in cleaner water in the two states, he said, "You can bet on it."
Massey ends fight

The company denies any wrongdoing or liability, said Shane Harvey, its assistant general counsel and spokesman.

"We were prepared to dispute a number of the allegations in the complaint," he said. "Rather than fight about it over the next couple of years, we decided to pay the penalty, improve our processes and hopefully work with the EPA and move forward."

He disputed the EPA's $10 million estimate for new pollution controls, saying he expects the amount to be smaller. He also said the modifications could save money by improving efficiency.

Five Kentucky subsidiaries of Massey were part of a lawsuit filed last May by the U.S. Department of Justice and the EPA, including Martin County Coal, which was responsible for the 72-acre Big Branch Impoundment that failed on Oct. 11, 2000, sending a black mass pouring out of underground mine works.

The spill fouled streams, polluted water supplies, killed fish and wildlife and damaged property in Eastern Kentucky and West Virginia, contaminating a 75-mile-long swath of the Big Sandy River.

The other Kentucky subsidiaries are Long Fork Coal Co., Sidney Coal Co., and the New Ridge Mining Co., Pike County in Pike County, and the Road Fork Development Corp. in Martin County.
EPA's complaint

One person who lives in the vicinity of the Big Sandy River -- Patty Wallace of Louisa -- called Massey "an outlaw company," but added, "I'm glad to hear at least they (the regulators) have done this."

The EPA's complaint alleged Massey violated its discharge permits 4,500 times between January 2000 and December 2006, pouring excess amounts of metals, sediment and acid mine drainage into hundreds of rivers and streams, in addition to slurry.

Many of the pollutants got into waterways in amounts 40 percent or more than was allowed, with some pollutants discharged at levels more than 10 times their limit, the government said.

Granta Nakayama, assistant administrator for EPA's Office of Enforcement and Compliance Assurance, said the settlement "raises the bar for the mining industry."
Fine 'sends message'

Judith Petersen, executive director of the Kentucky Waterways Alliance, said she hopes the fine "sends a strong message to coal companies that they must comply with environmental laws."

She said she also hopes it "sends a message to Kentucky agencies that if they won't enforce the Clean Water Act, the federal government will do so."

Petersen said that if state regulators, who issue the permits and are responsible for first-line enforcement of them, had brought the lawsuit against Massey, some of the fine money could have come to Kentucky.

But Mark York, spokesman for the Kentucky Environmental and Public Protection Cabinet, said the state had already collected penalties resulting from the Martin County spill. He said state environmental attorneys were taking steps to join the lawsuit based on other alleged violations but ran out of time.

Klepp, with the EPA, said Kentucky cooperated with the federal authorities and said that because the enforcement action involved multiple states, it made sense for EPA to take the lead. The $20 million goes to the U.S. Treasury, he said.

Massey, which reported $89 million in profits on revenues of nearly $1.7 billion for the first nine months of 2007, is the largest coal producer in the Appalachia region.

The company has been embroiled in a string of legal and environmental disputes from complaints about its mountaintop mining practices and pollution of waterways to mine safety and high-profile contract disputes.

The Associated Press contributed to this story.

Reporter James Bruggers can be reached at (502) 582-4645.