Massey Energy

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Massey Energy Company NYSE: MEE is a large coal producer with substantial operations in West Virginia, Kentucky, and Virginia. By revenue, it is the fourth largest producer of coal in the United States, its mines yielding around 40 million tons annually. The company controls 2.2 billion tons of coal reserves in southern West Virginia, eastern Kentucky, southwest Virginia and Tennessee or about a third of all Central Appalachian reserves. It currently employs about 5,000 people and operates 34 underground mines and 15 surface mines. In January of 2008, the US Justice Department ordered Massey to pay fines totaling 30 million dollars as part of an agreement resulting from a May 2007 complaint filed by the EPA.[1]

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[edit] Corporate governance

The company is headed by Chairman, President, and Chief Executive Officer Don Blankenship.

In 2004, Blankenship spent $3.5 million in a bitter campaign to back Brent Benjamin, a controversial nominee to the West Virginia Supreme Court. Blankenship has vowed to endorse at least one more judge to replace justice Warren McGraw who ruled against his company's plans to conduct mountaintop removal mining.[1]

Blankenship's critics accuse him of buying the court seat to secure favorable decisions in cases involving him and his company. In 2005, he advertised heavily to defeat a bond issue in support of an underfunded state employee pension plan. He opposed the reduction of the state sales tax on food from 6 to 5%, instead campaigning for its complete removal. His total personal political spending in 2004 and 2005 was $6 million (Solomon, 2006).

[edit] Corporate history

In 1920, A.T. Massey incorporated in Richmond, Virginia to broker coal sales. Twenty years later, Massey's operations expanded to include coal mining and processing. The company changed ownership several times. In 1974, St. Joe Minerals purchased a majority interest in the company. In 1981, that parent company was acquired by Fluor Corporation. A.T. Massey was wholly owned by Fluor Corporation from 1987 until 2000, when the unit was spun off and eventually renamed Massey Energy Company.

[edit] Labor relations

By December 31, 2004, the UMWA represented less than 4% of Massey’s total workforce. Its workforce at six coal preparation plants (handling about 22% of the company's production) and one surface mine is represented by a union. Providing "in house" life insurance, car insurance and now medical assistance has some people uneasy, as it could be argued that these benefits are reminiscent of the era of mining scrip and company stores. Union organizers continue to campaign at some of its open shops.

[edit] Community relations

In 2005, some residents of Raleigh County, West Virginia, complained that Massey's Goals Coal Company was endangering the health and well-being of students at the adjacent Marsh Fork Elementary School. In July 2005, the West Virginia Division of Environmental Protection revoked a permit for construction of a coal silo near the school. However, some local employees and residents support Massey Energy by arguing that the economic benefits received from the company outweigh the environmental impact to the area.

[edit] Environmental Record

In early 2008, the company agreed to a $20 million settlement with the EPA to resolve thousands of violations of the Clean Water Act for routinely polluting waterways in Kentucky and West Virginia with coal slurry and wastewater. Although this was the largest Clean Water Act settlement, the violations were estimated to have fines on the order of $2.4 billion.[2]

[edit] See also

[edit] References

  1. ^ http://www.nytimes.com/aponline/us/AP-Coal-Pollution.html?_r=1&scp=1&sq=massey&oref=slogin
  2. ^ Massey Energy to Pay Largest Civil Penalty Ever for Water Permit Violations | Newsroom | US EPA

Solomon, Deborah. "A Coal CEO's Unusual Pastime: Firing Up West Virginia Politics", The Wall Street Journal, February 13, 2006, pp. A1. 

[edit] External links

  • Massey Energy corporate web site
  • [2] Impact on Marsh Fork Elementary School by critics