WildEarth Guardians files suit over lease sale of Utah coal reserves

WildEarth Guardians on Sept. 11 filed suit at the U.S. District Court for the District of Colorado in an attempt to overturn the U.S. Interior Department’s June sale of more than 42 million tons of coal in Utah.

The lawsuit said this would undermine global climate progress, since much of this coal would be burned in power plants overseas, leading to CO2 emissions and setting back U.S. carbon reduction efforts.

“For our climate, it’s time for our coal to be kept in the ground,” said Jeremy Nichols, WildEarth Guardians’ Climate and Energy Program Director. “The last thing the Department of the Interior should be doing is giving the green light for companies to mine our publicly owned coal and ship it overseas to be burned.”

The Flat Canyon coal lease was sold this past June to Bowie Resource Partners. The lease would allow continued operation of the company’s Skyline mine, the second largest coal producer in Utah.

Bowie’s purchase of the publicly owned coal comes as the company is securing additional capacity to export coal overseas through the Bay Area of California, the enviornmental group said. Most recently, it was revealed that four Utah Counties—Sanpete, Emery, Carbon, and Sevier—secured a loan from the State of Utah for more than $50 million to invest in a new port facility in Oakland. Reports indicate the counties secured the loan to bolster Bowie Resources’ plans to export coal from its Utah mines, WildEarth said.

The sale of the Flat Canyon coal lease comes even as Sally Jewell, the Secretary of the U.S. Department of the Interior, has raised questions over whether the mining of publicly owned coal is consistent with U.S. climate objectives, the environmental group added. The sale of the Flat Canyon coal lease stands to “unleash” more than 78 million tons of carbon dioxide, equal to the amount released annually by more than 16.4 million passenger vehicles, WildEarth said.

The Interior Department originally approved the sale of the Flat Canyon coal lease in 2002. At the time, the agency claimed that the climate implications of mining coal were “beyond the scope” of the analysis. It wasn’t until June of this year that the agency decided to move forward with selling the coal, WildEarth said.

“The climate implications of more coal mining and burning may have been ignored in 2002, but in 2015, it’s unacceptable,” said Nichols.  “It’s time for Interior to pull its head out of the sand and stop selling more coal that only promises to dig us deeper into a climate debt.”

The BLM office in Utah held a June 17 competitive coal lease sale by sealed bid for the Flat Canyon Coal Tract—a 2,692-acre area in Sanpete County that is estimated to contain approximately 42 million tons of recoverable coal and is adjacent to the Skyline deep mine. The BLM said it received one bid, from Canyon Fuel Co. LLC, the operator of the Skyline mine, for $17.2 million or $6,388.92 per acre.

Skyline is one of the three Utah mines that Arch Coal (NYSE: ACI) sold earlier this decade to Bowie Resource Partners.

U.S. Mine Safety and Health Administration data shows that the Skyline mine produced 2 million tons in the first half of this year, 4.2 million tons in all of 2014 and 3.1 million tons in all of 2013.

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.