Colorado to receive more than $42 million as part of Asarco reorganization
John Suthers (R)
DENVER (Legal Newsline) - Colorado's state and federal government will receive more than $42 million as part of a Chapter 11 reorganization plan approved for Asarco Inc., and related companies.
Asarco's parent company, Americas Mining Corporation, filed the reorganization plan, which provides over $1.7 billion in funds for environmental remediation of more than 50 sites currently and formerly owned or operated by Asarco in 19 states.
Colorado's state and federal government will recover $22 million from Asarco as well as an additional $20 million earmarked for a custodial trust that will be used for environmental remediation at sites throughout the state.
"Asarco's reorganization is exceptional in that Colorado and the federal government will recover every dollar they claimed for environmental remediation — plus interest," Attorney General John Suthers said. "These funds will go a long way to improving and remediating sites Asarco operated at throughout the state."
The order, approved by U.S. District Court for the Southern District of Texas Judge Andrew S. Hanen, described the Asarco case as "one of the most successful bankruptcy proceedings in recent history" and "perhaps the largest and most complex case in bankruptcy history with respect to claims for environmental liability."
Asarco's bankruptcy case was filed in the Southern District of Texas in 2005 with 16 states and the federal government participating in litigation and settlement discussions throughout 2006 and 2007. Those discussions resulted in a series of settlement agreements approved on June 5 by Judge Richard S. Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas.
The environmental settlement fixes the amounts of environmental claims. Funding to satisfy those claims was held until confirmation of the company's Chapter 11 reorganization.
Judge Schmidt recommended a Chapter 11 plan filed by Americas Mining Corporation over one filed by Asarco. Judge Hanen confirmed the Americas Mining Corporation plan, which provides for full payment of the environmental claims.
Funding of an environmental custodial trust is included in the settlement, which will be used for environmental remediation of an 89-acre site in Denver, Colorado formerly used for smelting and refining. Remediation will also be performed at a former mining site near Silverton. The Denver site will receive $16 million for remediation with the Silverton site receiving $4 million.
The remaining balance of the funds will be used for remediation at a series of sites, including Leadville's California Gulch Superfund site, a 4.5 square mile site near Vasquez Boulevard and Interstate 70, the Terrible Mine site in Custer County, a site in the Bonanza mining district in Saguache County and the Summitville Mine Superfund Site.