Editorial board: Now is the time to reform coal lease process – Casper Star-Tribune, March 13, 2014

March 14, 2014

Categories: Coal, Congress, News, Newspaper editorial


The market did what environmental groups and some lawmakers couldn’t: settle a virtual moratorium on new coal leases in Wyoming’s Powder River Basin.

We think the de facto stoppage of new coal leases provides just the opportunity for the federal government to reform its coal leasing process to make sure taxpayers get their fair share from the minerals they own.

Instead of responding favorably to the moratorium demand, Interior Secretary Sally Jewell should instead commit to reforms proposed in the recent Government Accountability Office review of the process.

The GAO’s report recommended that the BLM follow coal pricing guidelines already used by BLM’s state office in Wyoming. But the GAO also had some recommendations for the state office, ones we hope it’s considering, to make its pricing process more rigorous. Put simply, neither the federal or state office factor in revenue companies stand to gain by lucrative sales to customers overseas.

Exports are still both literally and figuratively over the horizon: Most of the West Coast’s coal export capacity is still in the permitting stages. But rising export totals demand that the federal government review its process and make sure taxpayers are getting a fair cut of the bounty.

While the GAO didn’t publicly specify how much money its recommended revamp could mean for taxpayers, previous reports have said the lack of reforms cost taxpayers hundreds of millions of dollars.

The window for the department to revamp its leasing methods may be small. While no federal coal has sold since mid-2012, and no more is expected to sell through 2014, the slowdown in leasing doesn’t mean mine shovels are idling in the Powder River Basin. The mines are still busy mining and shipping out hundreds of tons of coal a year to run electricity power plants. A significant portion of electricity in the U.S. comes from the energy released by burning coal, and the demand isn’t going away any time soon.

Such demand, and global demand the basin’s mines could meet through new export terminals, means the Interior Department may not have years to fix its coal lease process. While leasing has throttled down, market changes and regulatory reversals could quickly change the picture and lead to renewed demand for leases.

The Interior Department should commit to reforming the lease process for coal and set a clear timeline to do so, both to hold itself accountable and provide some certainty to mining companies trying to decide when to bid for additional federal coal.

It’s time to make sure taxpayers get a fair shake on sales of the coal they own.

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