"A bankruptcy is never good news and there are a lot of unresolved issues surrounding this one that may negatively impact people's jobs, health benefits and lives," said Jeff Jarrett, director of OSM, "but I am pleased that the Office of Surface Mining was able to successfully ensure that reclamation will occur. These mines will be restored to use and not become an additional negative impact on people's lives. Without this settlement, many of these mines would have shut down and presented lingering hazards to people's health and safety."

On September 17, 2004, Judge William S. Howard of the US Bankruptcy Court for the Eastern District of Kentucky signed the orders approving Horizon's Plan of Reorganization, Asset Sale, and the Permitting and Reclamation Agreement. The Reorganization Plan and Asset Sale provide a new owner for each of the Horizon permits by distributing them into one of three entities: Newcoal, A T Massey Coal Company, or Oldcoal. The Reclamation Agreement, facilitated and endorsed by OSM, the regulatory authorities of each state, the surety companies and the new owners of Oldcoal will provide final reclamation on every permit.
"This agreement means no permit will be left behind," said Earl Bandy, Chief of the Applicant/Violator System Office, who led OSM's effort to craft a suitable plan for providing responsibility and funding for reclamation of the permitted sites. "We consider this a major victory for reclamation and we owe that to the approach we took from the beginning, which was modeled after Secretary of the Interior Gale Norton's 4Cs -- using Communication, Consultation and Cooperation in the service of Conservation."
Horizon Natural Resources Company filed for Chapter 11 bankruptcy protection in 2002, casting doubt on who would ultimately have responsibility for hundreds of millions of dollars worth of reclamation at the 425 sites in five states, Kentucky, Indiana, Illinois, Tennessee and West Virginia.

Last fall OSM initiated a major coordination effort aimed at making sure that reclamation issues would be addressed through cooperation among the various parties rather than dealing with liquidation and/or contentious litigation.

Among other efforts, OSM sponsored a workshop examining how the Surface Mining Control and Reclamation Act (SMCRA) should be implemented in a bankruptcy situation. OSM consulted with regulating authorities and surety companies and kept communications open by establishing an e-mail working group and hosting frequent conference calls and meetings. OSM coordinated with the Department of Justice and other bankruptcy experts to provide a regulatory presence in bankruptcy court and with the debtors and potential purchasers.

"Guidance and support from Secretary Norton allowed OSM to find a positive environmental resolution to complex and controversial bankruptcy law that fits within the regulatory scheme of SMCRA," said Bandy.