We got internationally renowned foresnic accountants, C. Lewis & Company, to analyse mining company Merthyr (South Wales) Ltd's accounts. Guess what? Not only can the mining company afford the full restoration, it has even set the money aside for it, and it can't legally spend it on anything else... unless the Council agrees to downgrade the restoration by granting the company's cut-price restoration application.

It's a stitch up! Don't let it happen

The new proposal was published on Merthyr Tydfil County Borough Council's website on Friday 21/02/2025. It is a plan to do as little as possible that would justify the company getting its hands on the £15 million currently held by the Council in an ESCROW account. But that £15 million was only intended to cover the barest necessities to make the site safe in case Merthyr (South Wales) Ltd goes bust. Merthyr (South Wales) Ltd hasn't gone bust though, and should be stumping up around £75-110 million to pay for the restoration.

1. Leave behind a flooded mining void (the void is 175m deep at one end) with capacity for 1 million cubic metres of water
2. Leave behind 3 overburden mounds (coal tips) containing approx 37 million cubic metres of colliery spoil, rock, and soil - around just 2.8 miles from the site of the Aberfan disaster, where a coal tip collapsed, killing 144 people. This would permanently alter the landscape beyond recognition from what it was before and the surrounding landscape.
3. Leave behind a huge exposed coal-face cliff. Other than being an eyesore for local people, rain will cause erosion over years expected to leach heavy metals and toxic elements from the coal into the flooded mining void that will discharge into local waterways.
4. An aftercare period of just 5 years - this must be at least 15 years to ensure any woodland planting that hasn't survived can be replaced and nurtured to maturity.

Mining company: Merthyr (South Wales) Ltd (MSW) is the current operator of the sprawling opencast coal mine, Ffos-y-fran, in Merthyr Tydfil, South Wales.

Claim: MSW claims "It was established that there are insufficient funds available to achieve the 2015 restoration strategy and therefore an alternative scheme is required." (EIA Scoping Report, July 2024). It is on this basis that a new application will be considered by Merthyr Tydfil County Borough Council.

MSW's 'solution': To downgrade the restoration scheme promised to surrounding communities to one that amounts to doing as little as possible. Even returning the tens of millions of cubic metres of coal tips to fill in the gaping void the company created and allowed to flood is considered "not feasible or economic" (EIA Scoping Report, July 2024)

Why MSW is offering to do any works: Merthyr Tydfil County Borough Council holds £15 million in an Escrow account that it forced MSW to pay into (by court order). This was never intended to fund the original restoration agreement costed at £75-120 million, but that is what's happening now as MSW is claiming the company doesn't have the finances to pay for the restoration it previously agreed to fund. MSW wants this £15 million so is proposing a massively downgraded restoration plan and presenting this as the only option so the Council will pay this out to them. The Council is afraid the company will walk away if it is compelled to honour its contractual agreement to fund the restoration itself. If that happens, the Council would have to pay a new company to come in to restore the site, which'd cost more.

Our recommendation: Merthyr Tydfil County Borough Council has refused to pursue MSW to deliver on the contractually agreed level of restoration, and is poised to consider a downgraded plan by MSW which would affect surrounding communities living in Merthyr Tydfil for generations. Haven't they put up with enough after 16 years of coal mining, dust, and noise pollution? The Welsh Government urgently needs to launch an inquiry MSW finances and the Council's actions, issuing a 'holding directive' to prevent the Council approving the downgraded plan in the meantime.

To our knowledge, there has been no evidence submitted by MSW that it cannot fund the full restoration it is contracted to undertake. On the contrary, MSW's most recent, publicly available, financial statement on Companies House says "during the year the directors again reassessed the restoration provision based on current operating costs in particular diesel prices which have decreased significantly and increased plant hire costs, which as a result increased the restoration provision by £0.2m to £91.2m",  by 31 Dec 2023, admitting record profits the year before, with its ultimate parent company, Gwent Holdings Ltd, reporting "The average coal price achieved increased by 94% to £151.66 per tonne" in its 2022 filing. This funding for restoration was based on Ffos-y-fran closing at the end of its planning permission in September 2022 - but it continued illegally mining coal for over a year after that, and even outside its licenced area, selling an extra 640,000 tonnes of coal - driving profits even further.

It's been claiming tax discounts to HMRC each year by phasing expected restoration costs that it now refuses to pay. This report goes on to say "The total costs of reinstatement of soil excavation and of surface restoration are recognised as a provision at site commissioning when the obligation arises. The amount provided represents the present value of the expected costs.".

This very much sounds like the company able and prepared to pay the restoration costs, and had already claimed tax discounts for it. So why is the company being allowed to duck tens of millions in what it owes?

As is typical of the mining industry, operations and financing is done through a complicated constellation of interconnected companies owned by family members (depictions of which are illustrative only and not based on any likeness). This kind of practice could help evade liabilities - though we're not suggesting that was the intention here. The following information is accurate to the best of our knowledge, please refer to Companies House for confirmation/further details:

• Merthyr (South Wales) Ltd
  • Company number 04261274
  • David Stanley Lewis - Director and shareholder
  • Jayne Helen Lewis and Andrew John Lewis - Ex-Directors
  • Named operator of Ffos-y-fran

• MERTHYR (NOMINEE NO.1) LIMITED
  • Company number 04261269
  • David Stanley Lewis - Director as of August 2024
  • Jayne Helen Lewis and Andrew John Lewis - Ex-Directors
  • Dormant company subsidiary of Merthyr (South Wales) Ltd

• Ffos-y-fran (commoners) Limited
  • Company number 04892620
  • Jayne Helen Lewis – Director
  • Andrew John Lewis - Ex-Director
  • Dormant company subsidiary of Merthyr (South Wales) Ltd

• Merthyr (Ffos-y-fran) Limited
  • Company number 06353565
  • David Stanley Lewis – Director
  • Jayne Helen Lewis and Andrew John Lewis - Ex-Directors
  • Dormant company subsidiary of Merthyr Holdings Limited

• Merthyr Holdings Limited
  • Company number 06330412
  • David Stanley Lewis – Director
  • Jayne Helen Lewis and Andrew John Lewis - Ex-Directors
  • Subsidiary of Gwent Investments Limited
  • Holding company

• Gwent Investments Limited
  • Company number 08936878
  • David Stanley Lewis - Director
  • Jayne Helen Lewis and Andrew John Lewis - Ex-Directors
  • Investment company

• Gwent Holdings Limited
  • Company number 10119615
  • Jayne Helen Lewis and Andrew John Lewis – Directors
  • Ultimate parent company of Merthyr (South Wales) Ltd

In May 2023, Coal Action Network wrote to the Climate Change, Energy, and Infrastructure Committee (CCEIC) of the Welsh Senedd, informing the Committee of the ongoing illegal coal mining at Ffos-y-fran in Merthyr Tydfil, and the Council and Welsh Government’s refusal to use their enforcement powers to prevent the daily extraction of over 1,000 tonnes of coal. After being informed of this context, the CCEIC committed to a short committee inquiry on Ffos-y-fran and the broader failure of restoration of former opencast coal mine sites, with oral evidence sessions in April and May 2024, in which Coal Action Network participated. In August 2024, the CCEIC published its report on the handling of Ffos-y-fran and restoration of opencast coal mining sites across South Wales, citing ‘missed opportunities’ and referring to Ffos-y-fran as “symbol of the system's failures”. Both the Welsh Government and Merthyr Tydfil County Borough Council (MTCBC) responded in September 2024 to the 26 recommendations contained in the CCEIC’s report. A selection of their responses are summarised or quoted below with our analysis following each. This is the brief version, check out our full analysis report with accompanying pictures.

The Welsh Government should require local authorities to ensure all Planning Officers’ reports are available online alongside associated planning documents, including revised, restoration plans, where relevant.

Welsh Government:

Response: Reject

We agree that transparency in planning decision making must be achieved, however, insisting on specific web publishing requirements at this time is premature.

Our analysis:

The thrust of recommendation 9 is to ensure Planning Officer’s reports are made public, as Planning Officers’ reports summarise in plain English numerous technical planning documents. Public access to this key report would greatly improve transparency. The Welsh Government should urge Councils to make Planning Officers’ reports publicly accessible, where possible.

The Welsh Government should reconsider the proposal from the 2014 report to establish a virtual “Centre of Excellence” for restoration planning, particularly in light of potential coal-tip reclamation proposals, and lead discussions with local government on how to implement this.

Welsh Government:

Response: Accept in principle

Given our existing presumption against coal extraction, we expect “very few schemes being brought forward”. Our primary focus is to ensure that disused tips are safe and to deliver a modernised, fit-for-purpose regulatory regime. After the disused mine and quarry tips Bill is passed The Welsh Government will take “a more detailed strategic approach to mining and industrial legacy in Wales – this will need to include reclamation of disused tips and management of open cast mining.”

Our analysis:

Contrary to the Welsh Government’s expectation of “very few schemes”, right now there are two schemes proposing coal extraction in South Wales, and a further application to downgrade the remediation scheme for Ffos-y-fran is expected before the end of this year. All these schemes would benefit from the kind of oversight the CCEIC are proposing with its recommendation for a Centre of Excellence, so action by the Welsh Government is needed now rather than years into the future.

The Welsh Government must engage with the UK Government with the aim of removing the Coal Authority’s statutory duty to maintain and develop an economically viable coal mining industry.

Welsh Government:

Response: Accept in principle

Whereas we would wish for the Coal Authority to remove its statutory duty to maintain and develop an economically viable coal mining industry, this duty has no practical effect in Wales… The Welsh Government is confident that it has in place the necessary policy and processes to ensure the climate emergency and nature emergency are fully reflected in any decision making.

Our analysis:

Contrary to the Welsh Government’s confidence, its policies were deemed compatible with an opencast coal mine extension just last year in 2023. Additionally, the Welsh Government Minister for Climate Change Julie James wrote to the UK Government in 2021 stating that: “…we consider the statutory duty of the Coal Authority to develop and maintain a viable coal extraction industry must be removed if we are to achieve our policy ambitions…”, which is at odds with the Welsh Government’s response to the CCEIC’s recommendation, and there hasn’t been relevant Welsh policy evolution in the meantime to explain this new position.

The Welsh Government should review and update the Minerals Technical Advice Note 2 (MTAN2) to ensure it is fit for purpose, particularly in the context of new developments and coal tip remediation.

Welsh Government:

Response: Reject

Minerals Technical Advice Note 2 Coal (MTAN2) contains comprehensive planning guidance which is robust about restoration and aftercare schemes for coal extraction. Along with all other planning policy, MTAN2 is kept under continual review to ensure it is kept up to date, fit for purpose and relevant.

Our analysis:

The Welsh Government released MTAN2 in 2009, so it fails to reflect the many relevant policy developments over the past 15 years. The Welsh Government’s refusal to review MTAN2 is also bewildering given the policy has ostensibly failed to secure decent restoration of numerous coal mining sites across South Wales since its implementation. MTAN2 needs to be reviewed in line with the CCEIC’s recommendation.

The Welsh Government should incorporate provisions for the restoration of former opencast sites within the forthcoming Disused Tips (Mines and Quarries) Bill.

Welsh Government:

Response: Reject

“In his Legislative Statement on 9 July 2024, the then First Minister made clear that inclusion of provisions relating to restoration of former opencast sites within the forthcoming Disused Tips (Mines and Quarries) Bill (the Bill) is not feasible at this time.” The Welsh Government cites further delay due to expansion of scope, and affordability as the key reasons for its position.

Our analysis:

Coal tips are created by the act of deep coal mining. Overburden mounds are created by the act of opencast coal mining – there is little difference between the two in their risk or cause. The other hazards posed by abandoned and under-restored opencast coal mining sites should also be dealt with in the same legislation, given their shared cause, similar urgency, and methods of resolution (monitoring, landscaping, and earth works).

The Welsh Government must mandate public consultation for all stages of the restoration process, including when revised restoration plans are brought forward.

Welsh Government:

Response: Accept in principle

Public participation is very important at all stages of the planning process and is to be encouraged. The wide range of development types and scales mean planning legislation can only set a minimum standard of consultation…however we expect planning authorities to consult where the public is materially affected by the submitted details.

Our analysis:

A restoration plan represents a promise made to nearby communities before they endure what is often years of disruption, noise, and dust during subsequent coal mining. Accordingly, those communities should be meaningfully consulted on proposed changes to that promise, with their feedback given significant weight in shaping associated planning decisions and conditions. We ask if the Welsh Government will issue guidance to Local Planning Authorities to this effect, to act on its acceptance in principle of the CCEIC’s recommendation.

The Welsh Government should advise local authorities to designate a specific officer as a point of contact for the local community, providing a direct communication channel between residents and local authorities on matters relating to sites or similar developments.

Welsh Government:

Response: Accept in principle

MTAN2 recommends the mining company appoints a site liaison officer. Additionally, Local Planning Authorities have a Planning Case Officer before an application is approved, and the enforcement team for after an application is approved.

Our analysis:

Within Local Planning Authorities, Case Officers often say they are too busy with their main work to engage more with public enquiries and concerns. Given the potential impact of planning applications on nearby communities, there’s clearly a need to have a dedicated contact point for community input and involvement. We ask if the Welsh Government will issue guidance to Local Planning Authorities to this effect, to act on its acceptance in principle of the CCEIC’s recommendation.

The Welsh Government should advise local authorities to create online portals where residents can access up-to-date information on all stages of the restoration process.

Welsh Government:

Response: Reject

Insisting on specific web publishing requirements at this time is premature. The Welsh Government is working with the Centre for Digital Public Services (CDPS) in exploring how digital solutions can improve the planning system in Wales. It is anticipated that the communication of decisions will form an integral part of that work. This will bring together the variability currently seen across authorities in a managed cost-effective way.

Our analysis:

The Welsh Government should expedite online public access to planning documents, and have facilitating public engagement as an explicit aim of this work. The poor design of some planning portals currently create barriers to community members accessing critical information about developments that will potentially impact them. We ask the Welsh Government to centre a public consultation in its design of digitalised planning systems.

The Welsh Government should encourage the use of citizens' assemblies as forums for discussing the future of restoration sites, particularly where restoration failed to meet the original planning permission and compromises need to be made.

Welsh Government:

Response: Reject

National planning guidance already recognises that well established liaison committees help to provide a better understanding of the impacts to be expected from mineral extraction. Many quarries and coal sites have established liaison committees which act as a forum for regular discussion and explanation of current problems. Where regular complaints are received or there is concern about local impacts the local planning authority should request that the operator cooperate in establishing regular meetings of a nominated group.

Our analysis:

We agree with the National Planning guidance’s promotion of community liaison committees, but find execution is inconsistent, and in some cases, absent altogether – even where there are serious breaches of planning control and trust. This has left some participating residents we’ve spoken with feeling ignored and apathetic. We ask if the Welsh Government will reconsider the sentiment of the CCEIC’s recommendation, by strengthening the National Planning guidance on community liaison committees.

The Welsh Government must explore stronger enforcement mechanisms to address breaches of planning controls without delay, such as the mining activities that continued at Ffos-y-Fran after the licence expired.

Welsh Government:

Response: Reject

The Town and Country Planning Act 1990 provides a range of effective enforcement options depending on the circumstances. Enforcement is focused on addressing the unacceptable impacts of unauthorised development rather than punishing the developer. Given the complex nature of planning impacts on both the environment and people it is sometimes acceptable to allow unauthorised activities to continue while consideration is given to the best course of action. That is what Merthyr Tydfil County Borough Council concluded at Ffos-y-Fran. However, where unacceptable harm is happening, the law does currently provide authorities with powers to stop activities immediately, either through a stop notice or Court injunction.

Our analysis:

Ffos-y-fran highlights that enforcement options are only robust to the extent that they can be implemented. For 15 months, Merthyr Tydfil County Borough Council believed the consequences of using enforcement options available to it were worse than allowing severe, long-term, harmful, and persistent breaches of planning control. This suggests that current enforcement options are not fit for purpose. Therefore we ask if the Welsh Government will reconsider the CCEIC’s recommendation and review existing planning enforcement options for their practical effectiveness in controlling largescale developments?

In the event that the water cannot be drained from the, voids at the site, Merthyr Tydfil County Borough Council must ensure that any, water bodies resulting from the restoration at Ffos-y-Fran are safe and provide, benefit to the local community.

Merthyr Tydfil County Borough Council:

Response: Accept

Our analysis:

Accepting this recommendation with no further comment will not reassure local communities, particularly given the lack of consultation to date, and unsafe conditions documented around the flooded voids at similar sites of Margam/Parc Slip and East Pit former opencast coal mines.

Merthyr Tydfil County Borough Council must ensure, that the revised restoration plan reflects, as a minimum, the objectives of the, original restoration plan, including: safe public access across the East Merthyr, historic landscape with a new network of trails and footpaths; sustainable, wildlife habitats and biodiverse environmental sites; protection and restoration, of surviving heritage features; and the return of most of the site for traditional, commoners’ use.

Merthyr Tydfil County Borough Council:

Response: Accept

Any revised scheme would inevitably differ in that overburden mounds 2 and 3 are, likely to be retained and a body of water will be incorporated into the scheme. The developer has also, indicated that they would wish to retain the motorcross facility.

Our analysis:

Allowing the void to flood and letting the site operator leave its colossal coal tips (overburden mounds) above ground amounts to an abandonment of the original restoration objectives promised to local communities. As with MTCBC’s refusal to issue a Stop Notice to prevent the daily illegal mining of over 1,000 tonnes of coal, allowing a noisy motocross to be atop one of those coal tips that operated during this period of unregulated illegal activity, would be seen as another betrayal of local communities to the benefit of the mining company.

Merthyr Tydfil County Borough Council should fully, involve local residents in the consideration of revised restoration plans for the, Ffos-y-Fran site.

Merthyr Tydfil County Borough Council:

Response: Noted

Our analysis:

We are disappointed at this glib and non-committal comment and invite MTCBC to properly respond to the CCEIC’s recommendation 24.

Coal Action Network’s drone footage on Monday 11^th March raised the alarm bell about the rising water levels. With this footage, a local resident informed Merthyr Tydfil County Borough Council of the rising water levels, only to be told that the Council was already aware of it, and that Merthyr (South Wales) Ltd had removed the pumps with no intention of reinstating them. Yet the Council made not move to inform any residents living close to the mine of the massive build up of water above their heads. The Council’s oversight of 15 months of illegal coal mining and now this intentional derailment of the current restoration plan is a further dereliction of its responsibility to the safety and wellbeing of town inhabitants. The Council has failed to hold Merthyr (South Wales) Ltd to account for its many transgressions over the past 15 months of illegal coal mining, with baffling impotence. Merthyr (South Wales) Ltd’s most recent action to remove pumps from the void is directly breaking the enforcement notice served to it by Merthyr Tydfil County Borough Council, but we won’t hold our breath waiting for the Council to do anything about that…

Find out more about the Ffos-y-fran opencast coal mine...

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