Alpha Natural Resources - Bonding

Reducing a bond obligation by $146 million through an innovative approach to pit backfilling.

2015 - 2016
Powder River Basin, Wyoming
Alpha Natural Resources

As part of its bankruptcy restructuring, Alpha Natural Resources (ANR) retained RESPEC to provide technical services in its reclamation bond filing for its Belle Ayr and Eagle Butte Mines at Wyoming’s Powder River Basin. Both operations have a combined annual production of over 35 million tons.

The state of Wyoming requires all mining operations to submit an annual reclamation bond estimate. RESPEC evaluated and revised ANR’s reclamation bond estimate for both operations from $410 million to $264 million—a 36 percent reduction. ANR, a major mining company based in Bristol, Virginia, is currently under Chapter 11 bankruptcy restructuring, and RESPEC has played an integral role throughout the process.

RESPEC evaluated all mining-affected areas at both mines by using aerial photography and a projected mine plan to determine the maximum affected area for reclaiming at each operation. RESPEC’s engineering team then calculated the associated costs relative to all reclamation activities, including pit backfilling, topsoil replacement, stream and lake reconstruction, facilities demolition, revegetation, and project management.

RESPEC used cast blasting to determine pit backfilling costs, which is considered a novel application of a proven technology. Instead of using the conventional drill-blast-haul process to reclaim highwall and backfill pits, RESPEC proposed using cast blasting to deliver material directly into the pit area below to significantly reduce material-handling and backfilling costs. An article discussing this cast blasting application was published in World Coal magazine in August 2016.

The revised bond estimates were approved by the state of Wyoming, and the bankruptcy court approved the ANR reorganization plan.  In addition to continue providing reclamation bond estimates for ANR in the future, RESPEC will expand its services to other facets of ANR post-bankruptcy operation, such as mine engineering-, environmental-, and reclamation-related services.