BLM leases extra coal to Oxbow Mining

The U.S. Bureau of Land Management office in Colorado on March 16 approved a coal lease modification for Oxbow Mining LLC’s Elk Creek longwall mine that allows the continuation of mining operations adjacent to the existing federal coal lease.

Oxbow’s application consisted of adding about 159 acres to an existing federal coal lease in order to prevent the bypassing of about 555,000 recoverable tons of federal coal. The tract was small enough that this sale didn’t have to go through a competitive auction process.

“The modification provides a logical extension of Oxbow’s D-Seam workings within the current Elk Creek mine,” said Barbara Sharrow, BLM Uncompahgre Field manager. “It also allows the mine to continue producing coal at the current rate, instead of ceasing production as recoverable leased coal reserves are exhausted.”

The Elk Creek mine has been in operation since 2002 and produced about 3 million tons of coal in 2011. It’s production has dropped sharply in recent years, with U.S. Mine Safety and Health Administration data showing output of 3.8 million tons in 2010 and 5.7 million tons in 2009.

In the meantime, with the Elk Creek mine expected to run out of coal later this decade, Oxbow Mining is working to explore a nearby, though not contiguous, coal reserve in the Oak Mesa area for a new longwall mine to replace Elk Creek. BLM last fall sought public input on a proposed coal exploration license on public and private land submitted by Oxbow Mining. The two-year exploration license is located on Oak Mesa north of Hotchkiss in Delta County, Colo. The BLM website indicates this license hasn’t been approved yet.

The application would allow Oxbow to perform exploration drilling on about 13,873 acres of federal coal that underlies BLM and private surface lands. The exploration drilling would allow Oxbow to obtain geological, environmental and other pertinent data concerning coal deposits. The proposal includes drilling 43 exploration holes, totaling 36 acres of new disturbance, the construction of 7.86 miles (14.24 acres) of temporary new roads and use of 30.55 miles of existing roads.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.