FLAGSTAFF, Ariz. — The Navajo Nation could receive a minimum $1 billion award for cleanup of uranium-contaminated sites on the reservation as the result of a U.S. Bankruptcy Court finding, tribal officials estimate.
The roughly 50 sites include abandoned uranium mines in the Lukachukai Mountains of northeastern Arizona and a uranium mill in Shiprock, N.M., that were run by Kerr-McGee Corp. The corporation spun off a paint materials company, Tronox, in 2005 before being purchased months later by Anadarko Petroleum Corp.
Judge Allan Gropper recently found that Anadarko could be liable for between $5 billion and $14 billion in a legal battle over the spinoff. He issued a memorandum of opinion last week finding Kerr-McGee legally responsible for fraudulent transfers.
The 50 Kerr-McGee sites on the Navajo Nation represent about 10 percent of the tribe’s inventory of abandoned mines. The mountainous sites rarely are visited, but a network of roads established for mining, logging and firewood gathering provide access. Uranium waste litters the land in Cove, Ariz., and a cell holds tailings at the Shiprock mill, where uranium ore was processed near the San Juan River.
Stephen Etsitty, executive director of the Navajo Nation Environmental Protection Agency, said the tribe doesn’t expect to receive a payout soon. Gropper hasn’t determined the exact amount for damages but has asked for more briefing materials. Anadarko officials have said they “vehemently disagree” with Gropper’s memorandum and will challenge his finding.
Any money awarded will help the tribe do preliminary screening of the sites, determine the extent of contamination and establish cleanup goals, Etsitty said.
Gropper found that Kerr-McGee “acted with intent to hinder and delay the debtors’ creditors.” He also determined the transaction left Tronox insolvent and undercapitalized, and financial damages are due. Other claimants in the case include the U.S. government, states and environmental response trusts.
Tronox filed for bankruptcy protection in 2009 and emerged about two years later. The lawsuits were transferred to trusts as part of the bankruptcy restructuring.
A bankruptcy settlement in 2010 provided $14.5 million to the Navajo Nation and the U.S. Environmental Protection Agency to address contamination at Kerr-McGee-run sites on the reservation.