Mine Owner to Pay $1.5B Penalty to Kentucky for Environmental Violations

By Dylan Lovan | August 21, 2014

West Virginia billionaire Jim Justice has reached a $1.5 million settlement with Kentucky officials over dozens of violations at several of his coal mines in eastern Kentucky.

The agreement between Justice and the state’s Department for Natural Resources is a reduction from the $4.5 million in outstanding penalties he owed for the violations, according to the settlement. Kentucky officials said the violations came from not doing post-mining reclamation work required by law at Justice mines in eight counties.

Kentucky Energy and Environment Cabinet Secretary Len Peters said in a news release  that the violations at Justice-owned mines “were among the most egregious we have seen in nearly a decade.”

“The fact that the operators ignored the many attempts by the state to have them correct the violations made the final agreement even more important,” Peters said.

Reclamation work at surface mines typically includes reshaping the land to its original pre-mining contours, along with planting trees and other vegetation to prevent soil erosion.

Justice, who is worth about $1.6 billion according to Forbes.com, has idled several mines in eastern Kentucky and said his Appalachian mines are struggling to stay open due to poor market conditions. He has also idled all his mines in Tennessee. Along with owning coal mines in five states, he owns the historic Greenbrier Resort in White Sulphur Springs, West Virginia.

Justice said in a statement Tuesday that the settlement is fair and his companies will work immediately to satisfy the terms of the agreement.

“We all fully recognize how devastated the coal market is today, however, the Kentucky settlement reaffirms what I have said many times, that we will never walk away from any liability or obligation,” he said.

The agreement, signed on Friday, also requires Justice to bond more than $10 million that would be returned to the company once the work is completed. The agreement says the final due date for the last of the reclamation work is September 1, 2015.

In June, Kentucky National Resources Commissioner Steve Hohmann sent a letter to the Roanoke, Virginia-based Justice company, saying he was suspending some mining permits, because the company’s mines had allowed the environmental problems to “languish and multiply.”

Peters said the order included personal assurances from Justice and his son, Jay Justice, that the agreement would be followed.

The settlement requires Justice to pay the penalty in 30 monthly installments of $50,000, with an initial payment of $250,000.

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  • August 21, 2014 at 2:38 pm
    gregsmith says:
    your headline is incorrect
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