Arch Coal Inc. has warned investors that increased regulatory scrutiny of mountaintop removal mining could hurt the company's bottom line, financial disclosures show.
In a report filed with the U.S. Securities and Exchange Commission, Arch Coal said it is worried about a federal court lawsuit and permit objections raised by the federal Environmental Protection Agency.
Arch Coal on Wednesday issued a statement to alert investors that its mining operation profits for the third quarter of 1998 would be below expectations.
Company officials blamed high maintenance costs, operating problems at two large surface mines in West Virginia - Dal-Tax and Hobet 21 - and poor rail service at Arch's western operations.
In a news release, Arch Coal CEO Steven Leer also said that, "However, in order to improve the performance at our Dal-Tex mine, we will need to secure the new permit for that operation in a timely fashion.
"A substantial delay in obtaining that permit or significant new restrictions on the surface mining process at the Dal-Tex mine would result in a curtailment of production," Leer said.
Dal-Tex wants a new permit to strip 3,100 acres of hills and hollows across W.Va. 17, to the east of its current operations near Blair in Logan County. A permit for the operation is being held up by EPA.
Federal officials say that Arch Coal and the state Division of Environmental Protection have not fully evaluated the environmental impacts of the mining and related valley fills.
The permit may still be months from being issued. EPA has scheduled a public hearing on it, and an A.T. Massey Coal Co. mountaintop removal permit, for Oct. 24 in Logan.
Leer's press statement was based on a quarterly report Arch Coal filed in mid-August with the SEC.