Coal's share of electricity generation in the United States is dropping as mine operators face much tougher competition from cheap natural gas supplies. Production in West Virginia is down this year, and while employment has risen over the past three years, it is down in 2012, with most major operators announcing significant layoffs.
In its bankruptcy filing, Patriot singled out its selenium treatment costs as an example of "more burdensome environmental and other government regulations," saying its treatment costs were running into "hundreds of millions of dollars."
Selenium, a naturally occurring element found in many rocks and soils, is an antioxidant needed in vary small amounts for good health. In slightly larger amounts, selenium can be toxic. Selenium impacts the reproductive cycle of many aquatic species, can impair the development and survival of fish, and can damage gills or other organs of aquatic organisms subject to prolonged exposure. It also can be toxic to humans, causing kidney and liver damage, as well as damage to the nervous and circulatory systems.
In 2003, a broad federal government study of mountaintop removal mining found repeated violations of water quality standards for selenium. The following year, a U.S. Fish and Wildlife Service report warned of more selenium problems downstream from major mining operations. One report from a top selenium expert has warned the pollution from Patriot's Hobet 21 site has left the Mud River ecosystem "on the brink of a major toxic event."
Another study, published in December in the prestigious Proceedings of the National Academy of Sciences, also pointed specifically to serious selenium violations downstream from Patriot's operations in the Mud River watershed.
In its bankruptcy filing, Patriot has complained about "substantial and unsustainable legacy costs," related to pension payments and health-care benefits for retired United Mine Workers union members.
Patriot noted that while only 11 percent of the nation's coal miners work under UMW contracts, 42 percent of Patriot's miners work under such agreements.
In the company's court filings, Patriot chief financial officer Mark Schroeder noted that the company is responsible for benefits to more than three times the number of retirees as it employs as active miners.
Most of those UMW retirees came from Peabody Coal, from which Patriot was formed in a corporate spin-off transaction in 2007, or from Magnum Coal, an Arch Coal spin-off company that Patriot bought in 2008.
UMW officials say Patriot has 2,000 active union members in West Virginia and Kentucky, along with more than 10,000 retirees and an additional 10,000 dependents, most of them in West Virginia, Indiana, Illinois, Kentucky and Ohio.
Reach Ken Ward Jr. at kw...@wvgazette.com or 304-348-1702.