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The Nature of the Debtor's Reclamation Obligation <br /> 3 . The DMG Litigation arises out of reclamation <br /> requirements which are governed by the Colorado Surface Coal Mining <br /> Reclamation Act ( "CSCMRA" ) . That act conditions the issuance of <br /> mining permits on the submission and approval of a mine reclamation <br /> plan. <br /> 4 . In order to obtain its mining permit in the early <br /> 19801s, the Debtor submitted a reclamation plan to the DMG. The <br /> Debtor also provided a performance bond to assure completion of the <br /> reclamation plan if reclamation had to be performed by the Colorado <br /> Mined Land Reclamation Board (the "Board" ) in the event of <br /> forfeiture by the permittee. The DMG permitted the Debtor to self- <br /> bond through a pledge of a rockdust plant owned by the Debtor. It <br /> now appears that the probable liquidation value of the rockdust <br /> plant is about $400, 000 , while the amount of reclamation expenses <br /> has been estimated at $3 million. <br /> 5 . On September 23, 1993, the Board entered an order, <br /> attached hereto as Exhibit A, declaring the Debtor's bond <br /> forfeited, on the ground that the Debtor had "failed to complete <br /> implementation of the Board's orders, particularly the Board's 1991 <br /> order containing the reclamation schedule. " Paragraph 7 of the <br /> order states that "the forfeiture of the bond does not relieve [the <br /> Debtor) of its obligation to perform reclamation and maintenance of <br /> the site as previously ordered, in full compliance with the permit, <br /> the statute, and the regulations promulgated thereunder. The Board <br /> hereby orders [the Debtor) to do so. " <br /> 6 . During the Summer and Fall of 1993, the DMG issued <br /> various Notices of Violation tc the Debtor related to the Debtor's <br /> reclamation plan. The notices impose abatement requirements, <br /> including the submission by the Debtor of technical revisions to <br /> the reclamation plan and implementation of the reclamation plan by <br /> the Debtor. <br /> 7 . The DMG also has filed a proof of claim in the <br /> Debtor's bankruptcy case, stating that it holds a secured clam: in <br /> the amount of $3 , 015 , 713 and unliquidated unsecured and priority <br /> claims arising from the Debtor's reclamation obligations , which are <br /> described in the proof of claim as an "ongoing obligation. " <br /> 8. Most courts which have considered claims of this <br /> type in bankruptcy have agreed with the DMG's characterization of <br /> the claim as an "ongoing obligation.. " The leading Circuit Court <br /> cases are set forth below: <br /> a. In Penn Terra Ltd. v. Dept. of Environ. Resources , <br /> 733 F.2d 267 ( 3rd Cir. 1984 ) , a coal surface mine <br /> operator violated state environmental protection statutes <br /> and entered into a consent order requiring remedial <br /> -2- <br />