A coalition of U.S. environmental groups said that Arch Coal's plan to emerge from bankruptcy fails to describe how the coal producer would finance its mine clean-up obligations, Reuters reported on Friday. Coal companies are required to provide bonds on future cleanup costs but during decades of strength in the coal sector many were allowed to self-bond, a federal program that accepted companies' own balance sheets as collateral. That has become a concern since chapter 11 filings by some of the biggest coal companies in the U.S. The self-bond program is now under federal review. In states where regulators do not allow self-bonding, mining companies have to pay for a form of insurance known as a surety or collateral bond. Arch Coal, the second largest U.S. coal miner, has self-bonded for $485.5 million in estimated cleanup costs, but has said that it expects its final clean-up costs to be significantly less than that amount. A hearing to approve Arch's disclosure statement is scheduled for June 9 in St. Louis. The company filed for bankruptcy protection in January with $6 billion of debt.
