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41, <br />Sightline <br />INSTITUTE <br />February 22, 2016 <br />Joe Pizarchik <br />Director <br />Office of Surface Mining Reclamation and Enforcement <br />1951 Constitution Avenue NW <br />Washington, D.C. 20240 <br />Sent via l 'SPS and entail to Director Pizcjrchikilr►s►r►re,gol= <br />Director Pizarchik. <br />1402 Third Avenue, Suite 500 <br />Seattle, WA 98101 <br />www slghllme org <br />206 447 1880 <br />RECEIVED <br />FEB 2 s 2016 <br />DIVISION OF RECLAMATION <br />MINING & SAFETY <br />We write to add our voice to the growing chorus of citizens, organizations, and states concerned <br />about private coal mining companies' failure to provide the financial resources necessary to guarantee full <br />reclamation of coal mines. <br />No case exemplifies these concerns more clearly than Peabody Energy. As the attached report <br />prepared by our organizations describes, Peabody Energy which touts itself as the largest private sector <br />coal company in the world is effectively insolvent. The company posted a $2 billion loss in 2015, <br />carries more than $6.2 billion in debt, and has no realistic chance of covering its enormous liabilities <br />through cash generated from ongoing mining operations. And like the entire US coal industry, Peabody <br />faces crushing pressures from falling natural gas prices and from increasing deployments of wind and <br />solar power, all of which are curbing the nation's demand for coal. Peabody's collapsing stock market <br />capitalization, the low trading prices for the company's bonds, and the high prices for its credit default <br />swaps, all show that global financial markets expect Peabody to file for bankruptcy within the year. <br />In the midst of its accelerating financial tailspin, Peabody has failed to set aside more than $1.47 <br />billion needed to cover its outstanding reclamation liabilities in five states. If Peabody were to declare <br />bankruptcy, as the market now believes is imminent, the company simply would not have the financial <br />resources necessary to guarantee full reclamation of its coal mines and to protect the public from the <br />fiscal, environmental, and health risks created by its mining operations. <br />As you are well aware, the U.S. Surface Mining Control and Reclamation Act (SMCRA) requires <br />private coal companies to provide financial assurances, called reclamation bonds, to guarantee full <br />Smart Solutions for a Sustainable Northwest <br />