WVDEP officials confirmed the terms last week, noting that some contingencies still need to be met, including court approval. At the center of the deal: the agency will drop its objections to Alpha’s plan to exit Chapter 11 in exchange for the miner’s multimillion dollar commitment.

The surety bonds Alpha posted to obtain mining permits will remain fully in place, the agency said. Alpha, the state’s last remaining self-bonded coal operator, will post an additional $100 million in penal bonds for both active and inactive sites, and will post $39 million in letters of credit or cash bonds as additional financial assurance for its plans to reclaim and perform water treatment at its remaining West Virginia sites.

Alpha and its creditors committed to provide another $209 million in funding for reclamation and water treatment over 10 years (at least $109 million) as part of a promise to provide half of its excess operating cash flow over and above that amount for reclamation and water treatment at legacy sites, and $50 million in reclamation and water treatment funding over the next five years. Alpha’s excess operating cash flow commitment, up to an additional $50 million, will also be guaranteed.

“Another company might have just walked away, leaving hundreds of millions of dollars of reclamation and water treatment obligations to the state’s Special Reclamation Fund,” DEP Cabinet Secretary Randy Huffman said. “DEP’s actions over the past four years have ensured that significant additional funding will be provided for reclamation, well over and above the amount of Alpha’s mining bonds.”

Alpha, which filed for bankruptcy last August, announced in February that it would divest some of its operations to a group of its secured creditors. Included in that sale was a West Virginia mine that WVDEP said would result in the potential for all but one of its mining sites having insufficient funds for its reclamation liabilities. The DEP subsequently entered an opposition to the sale with the Virginia bankruptcy court hearing Alpha’s case.

DEP Division of Mining and Reclamation Director Harold Ward noted that the company’s active and inactive sites still hold important metallurgical coal reserves.

“The met coal sector has seen early signs of improvement,” he said. “If the met coal market becomes more vibrant, Alpha will be well-positioned to restart or increase production at those sites and sell some of the world’s best met coal out of mines in West Virginia. That would benefit all West Virginians as well as ensure a steady flow of money for environmental cleanup.”