U.S. coal miner Arch Coal has agreed to set aside collateral to cover future mine cleanup costs as part of its bankruptcy reorganization plan, according to a court filing.
The plan would end Arch’s use of self-bonding, a controversial federal exemption that the largest U.S. coal companies have used for decades. Its use exempts companies from posting bonds or other securities to cover the cost of returning mined land to its natural state.
Arch had $485.5 million in self-bonds in Wyoming when it filed for bankruptcy protection in January, saddled with $6 billion of debt.
Under a reorganization plan set for a confirmation trial Tuesday in U.S. Bankruptcy Court in St. Louis, Arch must replace all of its self-bonds within 15 days of its bankruptcy exit plan becoming effective, a court filing showed Sunday.
Environmental groups that have waged legal battles to hold coal companies accountable for their cleanup obligations welcomed the news.
Read more: St. Louis Post-Dispatch