Will Blackjewel leave Eastern Kentuckians to clean up its abandoned coal mines?

There is a community in Eastern Kentucky where a road routinely floods, where water from wells smells foul and stains clothes, thick mud often coats yards and there are cracks in the foundations of several homes.

Residents in Harlan County say the damage is linked to mining by a company called Blackjewel, which blasted open the earth to uncover coal and then allegedly didn’t properly reclaim the sites.

Now, Blackjewel’s parent company, Revelation Energy, is in the final stages of a case in bankruptcy court, looking to terminate the permits on its more than 500 surface mines.

That raises a concern that the state could get stuck cleaning up the damage from the mines Blackjewel once controlled in Harlan County and elsewhere.

The Kentucky Energy and Environment Cabinet and several citizen groups have complained during the bankruptcy that Revelation already has fallen short on required reclamation at mines.

The cabinet raised the issue of flooding on Camp Creek Road at Wallins Creek in September. Judge Benjamin A. Kahn ordered Revelation to fix the problem, but it still hasn’t, according to Harlan County Judge-Executive Dan Mosley.

Mosley said the county had to install a bridge after heavy rain washed trees and silt from a Blackjewel mine into drainage tiles and blocked them.

The resulting flooding eroded the road and washed out a waterline. Flooding also has pushed in the underpinning under mobile homes along the creek.

The county spent $30,000 to $40,000 to clean up mud and debris, install drainage tiles and fix the water line, Mosley said.

The road isn’t the only spot at Wallins Creek where effects of Blackjewel’s mining linger long after the company laid off all its employees and stopped mining in mid-2019.

Elvis Sowders spends weekends repairing cracks in his house at Wallins Creek, damage he believes was caused by blasting at a nearby mine once operated by Blackjewel.

Sowders told state regulators there were cracks in the foundation and drywall of the house where he lives, and that the floor was not level.

At his sister-in-law’s house on the hill above Sowder’s, there were cracks in the foundation and damage to the chimney, according to accounts from Sowder and family members.

Sowders said he has spent about $40,000 on repairs to the two homes.

“If I didn’t fix it, it will fall in,” Sowders said in an interview.

He had to sell one house and take out a loan to cover the costs.

Residents of Eastern Kentucky filed a total of 385 complaints with state regulators against Revelation Energy over a decade before it went bankrupt in July 2019.

Two of the complaints were from Sowders’ brother, Mike, and neighbor Harold “Tommy” Saylor.

They filed the complaint with the Kentucky Energy and Environment Cabinet in September 2018.

“If somebody tears something up, I expect them to fix it,” said Mike Sowders.

Elvis Sowders said an inspector with the Division of Mine Reclamation and Enforcement visited the homes soon after the state received the complaint.

The inspector said the cracks were likely caused by blasting at the Blackjewel surface mine. However, Sowders ultimately got a letter saying the state had decided Revelation Energy was not at fault for the damage.

Still, Sowders and others said there are few houses in the neighborhood unaffected by mining, and cracks aren’t the only problem.

Sowders switched to using city water after his well went bad several years ago. The well water stained white clothes when he did laundry, he said.

Saylor still uses well water for drinking, though he said it smells like sulfur.

He also had drainage problems in his yard. He believes that is because ponds at the mine site near his home, which are designed to catch sediment being washed away, haven’t been cleaned out.

In another complaint, Amber Barvard said thick mud coated her yard at times when she lived in Wallins Creek; her house had cracks from blasting; and the well water turned her white clothes yellow.

Mike Dagnun, a former Blackjewel coal miner who lives at Wallins Creek, filed a complaint against Revelation about a landslide.

The creek near his home would get jammed and he was worried about the bank washing out, Dagnun said. He said the problem got fixed after a state inspector visited.

Outside Wallins Creek, problems persist

The cabinet also presented a case of a Bell County couple who was afraid of a slide wiping out their home.

Michael and Betsy Caldwell filed a complaint with the state in 2016 raising concerns about the stability of the slope above their house and water running off the site.

Kevin Hembree, assistant director of the Kentucky Division of Mine Reclamation and Enforcement, said at a hearing that he considered the situation a hazard to the residents.

“If this were to fail, it would more than likely hit the house below it,” Hembree said.

Caldwell said recently that the issue is still a concern, but he declined further comment.

The judge did not order Blackjewel to fix the damage to the saturated slope.

In a court filing in September, the cabinet described what will happen at Blackjewel’s old surface mines if they aren’t properly reclaimed.

“Conditions only get worse over time: Ponds fill in with sediment washed from unreclaimed mining areas resulting in polluted discharges, unreclaimed slopes erode and fail while depositing mud, rocks, and debris into creeks and the backyards and homes of the citizens that live in the valley bottoms below. Generally speaking, violations do not self-cure; they do not abate themselves simply with the passage of time,” the cabinet stated.

Citizen groups, led by Appalachian Citizens’ Law Center attorney Mary Cromer, also raised concerns in a court document filed Dec. 10, saying that without proper reclamation, “environmental violations will continue to accrue and the likelihood of some type of catastrophic environmental failure, like a landslide, increases.”

Neighbors of four Blackjewel sites said they’ve already seen the fallout from poor reclamation.

One was Tracy Neece, who has property in Printer, a community in Floyd county. Neece leases his property to Revelation Energy and three rental homes.

Neece said the mine site was unreclaimed and in a dangerous condition with exposed highwalls, clogged silt ponds and highly eroded areas.

It looks like a bomb went off, Neece stated in the objection.

Last summer Neece watched a large rock that was the size of a two-story house slide down the saturated slope of the mountain. He worries that children in the area might get hurt next time.

Teri Blanton, who owns properties near the company’s coal preparation plant in both Harlan and McCreary counties, complained about the water pollution coming off the site.

A state inspector determined the permits were discharging high levels of pollutants.

Decision to come

The bankruptcy court case is wrapping up. In December, the judge denied Revelation’s request to liquidate, leaving it to try to reorganize.

Blackjewel has sold 145 Kentucky mining permits with a bond value of more than $118 million and has 45 permits remaining to sell, valued at about $41 million in bonds. The bonds indicate the estimated cost to pay for reclamation on its mines.

Revelation has mines in Virginia, West Virginia and Wyoming as well. None of the permits have been transferred.

Blackjewel said in a court filing on Dec. 23 that it was “not presently aware of any environmental condition(s) that may present a threat of imminent and identifiable harm to public health and safety” at the mines where it wanted to abandon the permits.

The company acknowledged there were reclamation and remediation obligations still to be satisfied at the mines.

Before it filed for bankruptcy, Blackjewel’s parent company, Revelation, was a top offender in alleged environmental and reclamation violations, including impact to property near its surface mines.

According to the latest report from the U.S. Office of Surface Mining Reclamation and Enforcement, during July 2018-June 2019, Revelation Energy had 103 notices of non-compliances covering 182 violations, the highest amount in the state. In the previous year, Revelation also had the highest amount of non-compliances notices at 134, covering 259 violations. The agency hasn’t released the report covering July 2019 through June 2020.

The state wants Revelation and Blackjewel to fix the problems and avoid situations that threaten homes and infrastructure.

“We don’t want to get to the point that we got to on that permit that the road is basically destroyed,” Timothy Mayer, an attorney for the Energy and Environment Cabinet, said during a September hearing, referring to the road at Wallins Creek and the water-logged hill behind the Caldwells’ house in Bell County.

The citizen groups who have raised concerns in the Blackjewel bankruptcy about lack of reclamation don’t have faith that the company will do the work well, so letting the company abandon the permits may be the least bad option, Cromer said.

That would leave the state to clean up the mines, however, and the Energy and Environment Cabinet doesn’t have the money to do that.

The cabinet determined in late 2019 after reviewing 20 percent of Revelation’s permits that reclamation costs would exceed the amount of bond money the company had posted by about $38 million, given the conditions in place at the time.

Cromer said the citizen groups worry about the outcome of the Revelation bankruptcy case setting a precedent. The abandonment route is a first and likely to become more common as the coal industry declines, she said.

“Our question is who would pay to clean up the health and safety problems,” she said.

This story was originally published January 14, 2021 at 12:48 PM.