Energy & Environment

The Blackjewel bankruptcy case has been ongoing since the summer of 2019 when Blackjewel, LLC abruptly collapsed, leaving over 2,000 miners in Wyoming, Kentucky and West Virginia without their jobs, their benefits, or their final paychecks. In protest, Kentucky miners spent much of that summer camped on the railroad tracks to the mine, blocking the company’s last load of coal from the market.

Once an economic behemoth, Blackjewel filed for Chapter 11 bankruptcy. On Friday, March 19, Judge Benjamin A. Kahn approved the bankruptcy plan.

This plan will allow Blackjewel to sell its mining permits to other companies. Environmentalists have expressed concern that this would allow Blackjewel to abandon the permits it is unable to sell, leaving old, damaged mine lands unrepaired. Advocacy groups including Appalachian Citizens Law Center, Sierra Club, and Kentuckians for the Commonwealth have all taken an interest in this case. 

Appalachian Voices Central Appalachian Senior Program Manager Erin Savage said the case concerns them because of the volume of permits that will now be on the market. The permits — more than 200 total, and more than 30 of them in Kentucky — will now be on the market for a six-month period, in hopes other coal companies will purchase them. Savage says she fears that the coal industry’s economic decline may mean permits go unclaimed, leaving the reclamation of abandoned mine lands an open question. 

“I think we’re delaying a lot of inevitable bond forfeitures,” said Savage. If that happens, she added, finding sufficient will and money to properly reclaim these sites will become difficult, leaving community members living near those sites vulnerable to erosion, water pollution, and slope instability as the old mines continue to deteriorate.

Meanwhile, Blackjewel’s former miners are still waiting for full compensation following  a settlement with the company in a class action lawsuit based on a violation of the WARN Act. That law requires 60 days of notice before a mass layoff. This settlement grants workers the equivalent of 44 additional days of pay, on top of what they were initially owed by the company. However, it is unclear where their compensation will come from. Ned Pillersdorf, an attorney participating in the case, said the company’s former executive, Jeff Hoops, took advantage of the system, leaving miners and permits in limbo.

“We never thought this was a legitimate bankruptcy,” Pillersdorf said. “We always thought that Hoops diverted money from Blackjewel and declared bankruptcy to shed debt.”

Judge Kahn is expected to sign the final order this week, after which the ruling will go into effect.

Katie Myers covers economic transition in east Kentucky for the ReSource and partner station WMMT.