Rhino Resource Partners LP (NYSE: RNO) is seeing some forward movement at the U.S. Bureau of Land Management on its long-planned and long-reviewed Red Cliff longwall mine project in Colorado.
BLM is currently seeking public comment on a proposal to lease approximately 14,160 acres of federal coal reserves beneath BLM-managed lands in western Garfield County, 15 miles north of Fruita, Colo., to Rhino’s CAM-Colorado LLC subsidiary. This Book Cliffs reserve would make up much of the base reserves for the Red Cliff mine project.
Before the BLM begins writing a new Environmental Impact Statement on this proposal, it wants the public’s help in identifying issues and concerns to be addressed in the environmental review. All comments must be received prior to Feb. 18, or 15 days after the last public meeting (whichever is later) to be included in the draft EIS.
The Book Cliffs tract is estimated to contain approximately 78 million tons of in-place federal coal. Construction of a new mine would be required to access the coal.
This lease application was analyzed in 2009 under a draft EIS, but the bureau later decided that this draft had “fatal flaws” and needed to be re-done. One of the comments during that previous review was submitted by an unnamed coal company, that said the draft EIS alternatives didn’t include a tract configuration that would be attractive for a competing company to try and lease.
For the Red Cliff mine, CAM-Colorado is proposing to construct new mine entries and associated facilities, including a waste rock disposal area, railroad loop, unit train loadout, and a conveyor system to move the coal and waste rock. The railroad would be located on BLM and private lands, with the railroad connecting to the existing Union Pacific Railroad line near Mack. The production from the Red Cliff mine would be up to 8 million tons per year of clean coal, with an estimated mine life of 30 years.