The U.S. Bureau of Land Management on Feb. 27 released a Supplemental Environmental Impact Statement (SEIS) for the Greens Hollow Federal Coal Lease Tract in Utah, which is being sought by Canyon Fuel Co. LLC as extra reserves for the SUFCO longwall operation, which is the largest coal mine in Utah.
The Final SEIS for the Greens Hollow tract was prepared jointly by the BLM and the U.S. Forest Service, specifically the Manti-La Sal National Forest (MLNF) and Fishlake National Forest (FLNF). This document replaces the December 2011 Final Environmental Impact Statement in its entirety. The Final SEIS addresses concerns that were identified after releasing the FEIS and Forest Service Record of Decision (ROD) in December 2011. The Forest Service consented to BLM’s decision to offer a federal coal lease with conditions. The consent decision was appealed in February 2012
Following the appeal, the Forest Service withdrew the ROD in order to clarify the decisions to be made and agency decision authority, analyze the environmental consequences of potential actions to be taken by each agency, make technical corrections, and address agency compliance actions and resource concerns not previously analyzed in the original 2011 FEIS. This new analysis clarifies potential effects within the Greens Hollow tract and those that may be reasonably foreseeable on adjacent Forest Service lands, mostly under active coal leases.
The SEIS specifically addresses the consequences of implementing three alternatives including the No Action Alternative (the lease tract would not be offered for leasing), the Proposed Action in which the Forest Service would consent to BLM offering for lease the tract with conditions and the BLM would offer it for lease, and another alternative similar to the Proposed Action, but which includes additional measures (areas where longwall subsidence mining could not occur) to further protect specific resources.
The Forest Service proposes to consent to the BLM offering for lease the Forest Service lands in the Greens Hollow tract (approximately 6,175 acres) for production of federal coal reserves, with conditions for protecting nonmineral resources. The BLM proposes to offer the Greens Hollow tract for competitive bid and issue a lease with terms, conditions, and special stipulations. Under this alternative, about 56.6 million tons of recoverable coal reserves, representing some 8.8 years of mining, would be offered for lease.
SUFCO is one of three Utah deep mines that Arch Coal (NYSE: ACI) sold in 2013 to Bowie Resource Partners LLC. U.S. Mine Safety and Health Administration data shows that the mine produced 6.5 million tons in 2014, up from 6 million tons in 2013. A major customer is PacifiCorp for its in-state power plants.
Bowie and PacifiCorp announced in December 2014 that they have entered into a transaction for Bowie to supply all of the coal requirements of PacifiCorp’s Huntington plant located near Huntington, Utah, through 2029 (estimated at approximately 2.8 million tons per year). U.S. Energy Information Administration data shows that the primary coal suppliers to Huntington, a 909-MW plant, earlier in 2014 were PacifiCorp’s own Deer Creek mine, with most of the shipments, and also Bowie’s SUFCO mine.
PacifiCorp said on Dec. 15, 2014, that following an unsuccessful 18-month attempt to sell Deer Creek, it will close the mine in Emery County because it has become too costly to operate. PacifiCorp also said it has signed the long-term coal supply agreement with Bowie to supply coal for the Huntington plant.
The Deer Creek mine has an estimated five years or less of reserves, but much of the remaining coal has higher ash and sulfur content that has made mine production considerably more expensive and has made it more expensive to comply with air quality standards, PacifiCorp said. Rapidly escalating pension liabilities for the mine’s union-represented workforce was a large factor in the economic viability of the mine. The Deer Creek mine, located near the Huntington power plant, has been operating since 1974. PacifiCorp is targeting closure of the mine for early to mid-2015, pending regulatory approval.