Coal Lease Sale Would Open 133 Million Tons to Mining

By Beacon Staff

BILLINGS – Federal officials on Wednesday announced an upcoming coal lease sale that would allow a Montana mine to tap into an estimated 133 million tons of the fuel near Roundup.

The Bureau of Land Management said leases on 61 million tons of federally-owned coal will be auctioned through a competitive bidding process in late summer. The agency said the sale would open an additional 72 million tons of adjacent private and state coal reserves to mining by Signal Peak Energy’s Bull Mountain mine.

The reserves are in an area where Signal Peak plans to begin mining in late 2013.

The state would receive half of the up-front “bonus payment” associated with the lease sale and an equal share of future royalties. The BLM said an analysis of the leases determined the sale would have no significant environmental impacts.

Jeremy Nichols with Denver-based WildEarth Guardians said burning the fuel would release more than 220 million metric tons of the climate-changing greenhouse gas carbon dioxide.

The environmental group planned to appeal the BLM’s approval of the Bull Mountain lease sale, Nichols said. Similar actions have been taken by the group against 12 areas proposed for leasing in the Powder River Basin, an area of southeast Montana and northeast Wyoming that produces more coal than any other region in the United States.

“BLM seems to believe its job is to appease the coal industry, not advance a new energy economy,” Nichols said in an email. “Rather than do its part to confront global warming and find ways to transition away from dirty energy, BLM continues to rubber-stamp massive coal leasing proposals like this.”

BLM’s analysis rejected a link between global warming and the lease sale as impossible to calculate. “Effects on global warming at the contribution level of this mine cannot be quantified,” the agency said in a document signed by BLM field office manager James Sparks.

The proposed lease area also could be affected by pending measures in Congress sponsored by Montana lawmakers. Bills introduced by Sen. Max Baucus and Rep. Denny Rehberg call for the government to swap the Roundup-area coal reserves and additional reserves in southeastern Montana for privately held reserves beneath the Northern Cheyenne Indian Reservation.

The legislation is intended to give the Northern Cheyenne control over resources now owned by Great Northern Properties of Houston. Great Northern already had planned to sell the Roundup-area leases to Signal Peak if the deal went through.

Baucus’s office said the lease sale had been anticipated and “does not undermine the spirit” of his legislation.

“If the BLM lease sale is completed and ends up affecting the tracts included in the legislation, we will continue to work with the Northern Cheyenne tribe to see how they would like to move forward,” the Democrat’s office said in a statement to The Associated Press.

BLM spokeswoman Mary Apple said that exchange still could take place if the agency holds its sale.

“Provisions for this sale would be part of the exchange,” she said. “The legislation and the exchange could still happen, even if the coal is sold.”

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