This is the first installment in a new series of research updates by the Rainforest Action Network on the environmental and social risks involved with investment in the coal industry. These updates will highlight emerging risks facing companies involved with coal extraction, processing, or combustion.

In this update, we analyze environmental compliance risks at Alpha Natural Resources related to selenium emissions at the company's surface mines.

The report's key findings include the following:

• Alpha Natural Resources faces several ongoing environmental lawsuits at its surface mines in Appalachia, including five separate lawsuits filed in 2012 alleging selenium contamination from mine water discharges.
• Selenium compliance costs at surface mines can be significant.Selenium remediation expenditures at the surface mines at one of Alpha's peers, Patriot Coal contributed to a fivefold increase in the company's asset retirement obligations from $134 million to $743 million between 2007 and 2012.
• Selenium emissions at Alpha's surface mines may pose risks for investors. West Virginia regulatory enforcement data indicates that Alpha's selenium compliance record raises concerns for investors in light of the company's exposure to selenium-related lawsuits.
• The bankruptcy of Patriot Coal illustrates the danger of managing selenium compliance in the courtroom rather than in the boardroom.Improved disclosure by Alpha would enable investors to better understand its selenium-related litigation risks and compliance strategy.

Download the report here.