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Dead Constitution See other Dead Constitution Articles Title: Mayfly May Thwart $3 Billion in Coal Mined in U.S. Mountaintops Nov. 13 (Bloomberg) -- Mayflies may seal the fate of mountaintop mining in the Appalachian hills of the eastern U.S. Companies such as Massey Energy Co. that mine coal there by stripping mountain peaks and dumping debris in streams are being asked by the Environmental Protection Agency for the first time to safeguard the mayfly, one of the oldest winged insects and a bait favored by fly-fisherman. Applicants for new mines will have to show they wouldn’t cause pollution deadly to the aquatic bug. That puts at risk about $3 billion a year in coal that operators led by Massey and International Coal Group Inc. extract in Appalachia, said Kevin Book, an analyst at ClearView Energy Partners LLC. Without fresh permits to dump debris, mines may shut by 2012 in states such as West Virginia, he said. “The future of mountaintop mining looks bleak,” Book, who is based in Washington, said in an interview. “Ripping off mountaintops gets cheap clean coal, but there’s no way to do it without environmental impacts.” The mayfly, so irresistible to trout that anglers use it for bait and model lures after it, may become Appalachia’s spotted owl. Efforts to save old-growth forests in the Pacific Northwest, where the owls nest, led to federal protection in 1990 that restricted logging. Mountaintop mining produces millions of tons of crushed shale and sandstone dumped in valleys and streams. Rainwater flowing though the debris carries dissolved metals into waters below, a lethal stew for mayflies, the EPA says. In mountaintop mining, peaks are blown away by dynamite to expose coal. Companies may be forced to make greater use of tunnels and shafts, which require more labor and can add $3 to $10 to the cost of extracting a ton of coal, Book said. Producers’ Uncertainty “The EPA’s decision adds further uncertainty for coal producers,” Richard Whiting, chief executive officer of St. Louis, Missouri-based Patriot Coal Corp., said on an Oct. 27 conference call. “If future permits are not granted, an important source of low-cost fuel for electricity will be eliminated.” International Coal, Massey Energy and Patriot Coal are the companies most reliant on mountaintop mining in Appalachia, said Jeremy Sussman, senior coal analyst with Brean Murray, Carret & Co., a New York-based investment bank. Mountaintop mining in West Virginia, Kentucky, Virginia, Tennessee and parts of Pennsylvania and Ohio accounts for 6 percent of U.S. coal production. Half of U.S. electricity comes from burning coal. Alpha, Peabody The end of mountaintop mining in Appalachia would remove about 70 million tons a year from the market, increasing demand for coal from Colorado, Montana and Wyoming, according to Book. That may benefit producers that mine in those states, such as Alpha Natural Resources Inc. and Peabody Energy Corp. Massey had $2.9 billion in revenue last year, all from mining in Appalachia, according to its annual report. International Coal reported $1.1 billion in revenue, with $882 million from Appalachia. Patriot Coal had $529 million in revenue, including $460 million from Appalachia. About half of International Coal’s revenue comes from mountaintop mining and other surface-mining techniques; the other companies didn’t provide a breakdown. “If the most sensitive mayfly has to be protected in its habitat at the expense of coal mining in the entire region, we don’t think that’s a wise tradeoff,” Gene Kitts, senior vice president of mining services for Scott Depot, West Virginia- based International Coal said in an interview. “The issue that the EPA has conjured up here doesn’t bear shutting down surface mining.” Massey’s Plans Without new permits, Massey Energy will rely more on conventional tunneling, CEO Don Blankenship said on an Oct. 28 conference call with analysts. The impact of permit restrictions may be felt beginning in 2011. “We always worry about what EPA and others will do,” he said. More than 1,200 miles (1,930 kilometers) of creeks and streams have been buried by mining debris in Appalachia from surface-mining techniques, including mountaintop removal, the EPA said in 2005. Mining’s threat to mayflies, which hatch in streams and grow to a quarter-inch to more than an inch (2.5 centimeters) long, has been documented since the late 1990s. This year, the EPA under President Barack Obama for the first time held up new permits on the grounds of inadequate safeguards for the insect. Companies opt for mountaintop mining when shallow coal deposits in unstable rock formations make underground mining dangerous, said Carol Raulston, a spokeswoman for the National Mining Association, a Washington-based trade group. 79 Permits The EPA said in September it was withholding for further study 79 mining permits in Appalachia under new criteria that consider the mayfly’s habitat. Most of the permits were submitted under an expedited approval process that the Bush administration encouraged. “I don’t see any way to get around it,” said Matt Wasson, director of programs for Appalachian Voices, a Boone, North Carolina, group opposed to surface mining. “There’s just a higher density of clean freshwater streams there than just about anywhere else in the country.” The industry’s “alarm bells” aren’t necessary, as coal will continue to play a role in the U.S. energy supply, Nancy Sutley, head of the White House Council on Environmental Quality, said in an Oct. 16 interview. “The goal is to ensure that we are dealing with the impacts on the natural resources and on the health of these communities adequately,” she said.
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