US gov’t receives coal bids

The U.S. Bureau of Land Management (BLM), part of the Department of the Interior, is receiving bids from eligible companies to mine about 325 million tons of coal on federal land in Wyoming.

To qualify for a federal coal lease, a company must be incorporated and organized under U.S. law.

The property comprises the 23.5-metre thick Wyodak coal seam in southeastern Campbell Cty.

The lease sale is being held at the request of Wyoming-based Powder River Coal Co., a subsidiary of Peabody Energy (BTU-N), the world’s largest coal company.

The BLM receives revenues on coal leasing in three ways: at the time of leasing, a lump sum is paid; there is an annual rental payment of US$3 per acre; and royalties are paid. Royalties are 12.5% of the value of the coal recovered by strip mining and 8% of the value of coal recovered by underground mining.

Revenues are shared by the Department of the Interior and the state in which the coal is mined.

The BLM manages 261 million acres of public lands, primarily in 12 western states, as well as 700 million acres of sub-surface mineral rights, about 570 million of which are coal-related.

Bids are due by Aug. 30 at the BLM’s Wyoming state office; winning bids will be announced on the following day.

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