CASPER, Wyo. — Blocked by a landowner, the Bureau of Land Management denied a request to lease 63.3 million tons of coal, delivering a blow to the expansion of a mine in the Powder River Basin.
It is believed to be the first time the BLM nixed a coal-mining application in Wyoming.
The coal, which belongs to the federal government, sits under land adjacent to the Coal Creek mine south of Gillette. The operation would have added about four years to the life of the mine, according to the BLM.
The BLM’s decision, announced Friday, came after the agency said an owner of surface rights to most of 1,151 acres of land didn’t consent to the leasing of the coal.
The area, known as the West Coal Creek tract, would have added to the Coal Creek mine owned by Thunder Basin Coal Co., a wholly owned subsidiary of St. Louis-based Arch Coal Inc.
Arch applied for the lease in February 2006 through Ark Land Co., another subsidiary. It owns the rest of the land in the tract.
Landowner Dennis Edwards apparently didn’t consent to plans to offer the lease for bid. The BLM said it requested notification of Edwards’ consent from Ark Land Co. on four separate occasions and never received it.
“The BLM has not received a consent document and does not offer for lease qualified surface owner lands at a competitive coal lease sale without such consent,” the agency said in its decision.
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Edwards didn’t immediately respond to the Star-Tribune’s request for comment Friday.
If the BLM had approved plans to lease the coal, the agency would have opened the tract to competitive bidding, a process through which the adjacent mine owner can bid for the adjacent land to expand operations.
The Coal Creek mine produced 11.4 million tons of coal in 2010 and employed 161 people, according to data from the federal Mine Safety and Health Administration. The mine has 687.8 million tons of recoverable coal remaining, according to the BLM.
At the current production rate, that allows for another 60 years of mining.
“I was disappointed to see the lease wasn’t going foward,” said Marion Loomis, executive director of the Wyoming Mining Assocation, which represents the state’s mining industries. “We certainly need additional coal reserves put up so companies can make plans for future production. And there is still demand out there, so hopefully something can be resolved to allow that company to obtain additional leases in the future.”
The lease application was one of 12 pending before the BLM to expand mines in the Wyoming portion of the Powder River Basin. Those expansions, known as maintenance leases, total 35,605 acres containing 4.47 million tons of coal.
“We do not comment on matters related to a coal tract that’s in an active leasing phase,” said Arch Coal spokeswoman Kim Link, in response to a request for comment.