The U.S. Environmental Protection Agency exempted the mine from a new policy that will subject mountaintop removal permits to much greater scrutiny and environmental study.
Lawyers for the environmentalists contend permits issued by the U.S. Army Corps of Engineers and the state Division of Environmental Protection violate the federal Clean Water Act and the 1977 federal Surface Mining Control and Reclamation Act.
The Pigeonroost permit has become the focus of a legal and political battle over mountaintop removal that has heated up over the last two years.
After Haden decides that permit's fate, the judge still has to hear a bigger, more complex case that alleges the state DEP has established a "pattern and practice" of granting mountaintop removal permits that don't comply with federal laws.
During Friday's hearing, Dal-Tex General Manager Mark White testified that delays in the permitting of his mine expansion are costing Arch Coal $1 million a month.
White said that the company has already laid off 13 preparation plant employees and could put more out of work if the new permit isn't granted by June or July.
"We will not have anyplace to dig without the pending permit," White said. "I don't know what upper management will do. They could pull the plug or hang in there."