$22 million lease covers 56 million tons of coal in central Utah

U.S. Department of the Interior Secretary Ryan Zinke announced the approval of a $22 million coal lease this week. The lease, located on the Greens Hollow tract in central Utah, was issued by the DOI to Canyon Fuel Company, LLC, a subsidiary of Bowie Resource Partners, LLC.

On January 4, 2017, the Utah BLM office held a competitive coal lease sale for 6,175 acres of the underground Greens Hollow coal lease tract following several stages of environmental analysis. It is estimated to contain more than 55 million tons of recoverable, high-energy-producing coal. The bid of $22,850,000 by Canyon Fuel Company, LLC (Canyon Fuel) was determined to be the high and acceptable bid ensuring fair market value of the coal. Greens Hollow holds a lease adjacent to the mine which currently employs over 660 workers and 1,000 supporting jobs in the area.

U.S. Issues Coal Lease in Utah: “The Interior Department is in the Energy Business” – Zinke

Sufco mine in Salina, Utah. Source: Bowie Resources

The tract is part of the Wasatch Plateau Known Recoverable Coal Resource Area and is immediately adjacent to the operating Sufco mine near Salina, Utah. The lease is wholly underground coal with approval for two small surface disturbances necessary for safety and essential mine services. The Greens Hollow lease is feasible to underground mining, which helps ensure the vital water, aesthetic, and archeological resources are protected.

Coal mining in the area currently supports nearly 1,700 mining and related jobs, the DOI said in its press release.

U.S. has world’s largest coal reserves and coal mining on federal leases equates to jobs – Zinke

“The United States has more coal than any other nation on earth, and we are lucky to be at a time in our history that we have the technology available to responsibly mine coal and return our land to equal or better quality after,” said Zinke.

“For many communities and tribes in Utah, Montana, New Mexico and other states across the west, coal on public lands has been both a boon and a missed opportunity.

“With the potential for thousands of jobs and millions in economic opportunity, the Interior Department is committed to balancing the development and conservation of these resources. The Greens Hollow lease sale is a sign of optimism for the Trump Administration and the pro-energy and pro-growth economic policies to come.”

Secretary Zinke also announced that Bureau of Land Management (BLM) career veteran Michael Nedd will serve as Acting-Director of the BLM. Previously, Nedd served as Assistant Director for Energy, Minerals, and Realty Management.

Greens Hollow LBA was received in 2005; area’s underground coal mining dates back to the 1940s

U.S. Issues Coal Lease in Utah: “The Interior Department is in the Energy Business” – Zinke

Archive: Utah.gov

The Greens Hollow Lease by Application (LBA) was received on October 6, 2005 and the environmental analysis was initiated. The U.S. Forest Service is the surface management agency of the coal tract, with the BLM managing the subsurface minerals.

According to the U.S. Forest Service, coal leasing and active underground mining have occurred in the area since the 1940s. The existing mine in Salina Canyon provides electricity to about 1.4 million households. The coal resources in the Greens Hollow Tract could power 11.8 million homes, the DOI said.

On October 5, 2015, the U.S. Forest Service completed their Record of Decision and letters of Consent to Lease were provided on the same date to the BLM from the U.S. Forest Service.

Nedd’s appointment is a signal:  “The Interior Department is in the Energy Business” – Zinke

When signing the secretarial order announcing Mike Nedd as the new Acting-Director of the BLM, Zinke said, “Let me make one thing clear, the Interior Department is in the energy business and Mike is an energy guy who understands the balance we must strike when developing resources and creating jobs on our public lands. It is my hope that working together he will help identify areas where we can expand responsible mineral development while still conserving habitat and wildlife.”

Prior to serving as the Acting Director, Nedd was the Assistant Director for Energy, Minerals, and Realty management for the BLM, a position he has held since 2007. Before joining the Department, he spent more than eight years on active duty in the military as an officer and enlisted soldier, in several highly specialized units, including U.S. Army Special Operations. He began his career with the BLM in 1991 and has served in several positions at the BLM, including that of State Director, Associate State Director, and Deputy Chief Information Officer.

The BLM manages more than 245 million acres of public land, the most of any Federal agency. This land, which is known as the National System of Public Lands, is primarily located in 12 Western states, including Alaska, the bureau said.

The BLM also administers 700 million acres of sub-surface mineral estate. In Fiscal Year 2015, the BLM reported that it generated $4.1 billion in receipts from activities occurring on public lands.

Federal leases for coal and oil and gas development were greatly reduced in recent years, but the new administration has made it clear it will reverse the prior administration’s policies that held back energy development.  Yesterday the White House released its proposed FY 2018 budget and stated its intention to encourage energy development on federal lands.




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