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Show ' tyll Western Resources WRAP-UP Federal coal leasing, Part I nsider Bv Helene C. Monberg prececJVithin five to seven years, federal hen ijl will be displacing foreign oil in health Jral es most notably California, ijury fir Southwest states, where electric 'erating growth is above two percent ually will need federal coal for new hCeJ'wer) plants," Sheridan A. Glan of I h Mineral Corp., at oversight ' a;rings on new federal coal leasing Jjram. 6-12-80. rs'e , ashington "I don't think you have Kai y many beefs" against the new s rw1 ;ral coal program being developed Eu, Site Interior Department, Warren i h lt,;te, natural resources expert for the ' Vpotent state of Wyoming, recently nvestj: j u Served. We view the Departments new ,t at leral) coal leasing program as a -f model automobile. The first year resX,: built you have to take it back to the re pwip a few times to get the bugs ironed mee gut on this model, at least, we don't ;es, ar. jj weu nave a recall," Sherican A. tnesl! nof Arch Mineral Corp., of St. Louis earto d'X'1 believe e coaI leasin6 program j , tt regulations are basically sound," D7id C. Masselli of Friends of the -ourt, th responded in reply to inquired. 'r Vlcl!ll were witnesses at an oversight '''ring on the Interior Department's rts to implement a new federal coal :. 'iing program held by a Senate lnipoi'.rgy Subcommittee on June 12 lustr! iredby Sen. John Melcher, D-Mont. stnortly thereafter virtually no op-is op-is ition surfaced at hearings which an irior Department team held in 8 P wer and Craig, Colo., on June 23-24 , the draft environmental impact when lament (EIS) on Interior's planned sues tik 0f federal coal in the Green River-Ith River-Ith ar:ns Fork area in January 1981. hen Interior is tentatively scheduled mana:ffer520 miiion tons of coai for ease than federal coal lands in Routt, Rio nmentnco and Moffat Counties in Nor-' Nor-' estern Colorado and in Sweetwater Carbon Counties in south-central wning. This will be the first general iral coal lease sale in the nation :e a moratorium on federal coal ling was imposed initially by In-or In-or in 1971. wrtly thereafter, Interior plans s of federal coal leases on public 1 in June 1981 in the Southern Ap-chian Ap-chian area in the Southeast ; in the t ta-Southwestern Utah-hwestern Utah-hwestern Colorado area in July and in the Powder River Basin in tern Montana and Northeastern iming in April 1982. terior Secretary Cecil D. Andrus blished the new federal coal leasing jram in June 1979. At the time, ording to Interior, his an-ncement an-ncement "ended an eight-year jry of starts, stops and restarts of ral coal policy-making." The four duled lease sales "obviously offer first demonstration and test of the program, and at this time, a year r the Secretary's decision, each is on time," Assistant Interior etary Guy R. Martin said at the sight hearing on June 12. terior used the hearings on June 12 ! and its contacts with the press to i support for its new program. 0 there is a widley held belief that it . lore in the nature of a land-use . ming exercise than a coal leasing jram, hence longer and more , I plicated than it should be, In- I I r's Martin insists the new program J be successful precisely because it part of the Department's land-use ining process mandated by gress by several laws passed in the and late 1970's. "We are right on ' rdule. No major legal challenge has 1 made to it to date, and it has siderable support, particularly l the states," Martin told Western. Jurces Wrap-up (WRW) in an in-iew in-iew on July 3. eaking for the state of Wyoming also for the governors of the other or Western coal producing states, th Dakota, Montana, Utah, rado and New Mexico, Govr. Ed schler, D-Wyo., stated in a letter to Senate Energy Subcommittee on 5 5, "we find the new federal coal lagement program to be a very nising departure from the past," icularly from the standpoint of Jding state and local governments lans to implement it. artin detailed specifically how the program differs from "interior's federal coal leasing policies on ; 12. is a part of the regular planning ess of the Bureau of Land agment (BLM) "which controls all r resources, uses and interests" on ic lands. In the past, industry inated lands that it wanted to lease, lis is a sharp departure from the irly in the process public lands are ected to "unsuitability criteria." so s clearly identified as unsuitable surface coal mining drop out fast, s avoiding false starts costing time money," Martin testified. This ess is mandated under a provision tion 522) of the Surface Mining roland Reclamation Act (SMCRA) 177, he said. It is being field-tested , and if it proves to be unduly restrictive, it will be modified, according ac-cording to Martin. It is designed to meet "identified national energy objectives and regional coal production demands." This is a departure from the past. Leasing tarets are set by region, and are reviewed at least every two years. This was done to try to get away from the large number of leases issued in the 1960's on which there was little or no production, Martin explained. Unfortunately, Un-fortunately, the model used by the Department of Energy to set such leasing targets did not have up-to-date information. The leasing target for the all-important all-important Powder River area was set at 776 million tons of coal last year, based largely on DOE projections. "We know that this target will be increased," in-creased," Patrick H. Geehan, deputy director of Interior's coal leasing office told WRW on July 8. "There is a helluva demand to lease Powder River coal. We need a heck of a lot of it, and it is in shallow seams near the surface, so it is easy to mine." The projections are being revised by an inter-agency team. The program is based on several laws passed in recent years including SMCRA, SM-CRA, the BLM Organic Act of 1976, the federal coal leasing amendments of 1976 which terminated the prospecting permit system and non-competitive leasing for a competitive leasing system, and the law creating the Department of Energy (DOE) in 1977. These laws mandated broad public participation, input from states, local governments, environmental groups and industry. This has had two major results. It has materially cut down on challenges to the program in court. It has also lengthened the leasing start-up time, Interior admits. Geehan told WRW there is nothing in current statutes which requires Interior In-terior to have regional coal teams and do tract ranking. The regional coal teams are particularly important in the leasing process, as they make recommendations to the Secretary of Interior on leasing targets, tracts to be offered for lease, timing of lease sales and lease stipulations, and are the forum for joint Interior-state action on all other issues relating to federal coal leasing, under regulations put out by the Department last year. f ' -. The 1976 federal, coal leasing amendments mandated that no federal coal lease could be sold for less than its fair market value, and it set the minimum royalty rate for surface, mineable coal to be leased at .12.5 percent. Because the federal government govern-ment owns 60 percent of Western qpa.l reserves, it is the price setter for Western coal not only on federal land, but on private and Indian land as well... The fair market value provision was put into the 1976 law because many -critics felt the government, was not . charging enough for its coal leases. But -the increases mandated by the 1976 law ' made federal coal higher than the going rate for privately-owned coal in the West. Interior studied the problem for a . year, and on May 28 Secretary Andfusl . decided federal coal lease rates should "steer a course midway between seeking to maximize" returns and meeting the Department's minimum . legal obligations under the. law . ' Finally, the Department "-has just let a major contract for a study, of social . effects of coal development -in the West," Martin stated June 12, to determine how coal development affects af-fects nearby communities, to give all branches of government guidance, on : socio-economic problems in setting . regional' leasing demands as well as national production goals The work is being done by Mountain : West Research, Inc., of Billings, Mont.,, under a $410,000 two-year contract with BLM. It is to provide actual how-to-do-; it-guides and training on how . to use them for public officials who have to cope with socio-economjc eteets, . resulting from large-scale leasing of , ; public lands such as is sure, to occur on v. the coal-rich Powder s River Basinv according to Interior, |