[Federal Register Volume 74, Number 227 (Friday, November 27, 2009)]
[Notices]
[Pages 62290-62292]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-28389]


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DEPARTMENT OF ENERGY


Notice of Intent To Prepare an Environmental Impact Statement for 
a Proposed Federal Loan Guarantee to Support the Construction and 
Startup of the Medicine Bow Fuel & Power Coal-to-Liquid Facility in 
Carbon County, WY

AGENCY: Department of Energy.

ACTION: Notice of Intent to Prepare an Environmental Impact Statement 
and Conduct a Public Scoping Meeting, and Notice of Proposed Floodplain 
and Wetlands Involvement.

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SUMMARY: The U.S. Department of Energy (DOE) announces its intent to 
prepare an environmental impact statement (EIS) pursuant to the 
National Environmental Policy Act (NEPA) of 1969, as amended (42 U.S.C. 
4321 et seq.), the Council on Environmental Quality (CEQ) NEPA 
regulations (40 CFR parts 1500-1508), and the DOE NEPA implementing 
procedures (10 CFR part 1021) to assess the potential environmental 
impacts for its proposed action of issuing a Federal loan guarantee to 
Medicine Bow Fuel & Power LLC (MBFP) (DOE/EIS-0432). MBFP, a wholly-
owned subsidiary of DKRW Advanced Fuels LLC, submitted an application 
to DOE under the Federal loan guarantee program pursuant to the Energy 
Policy Act of 2005 (EPAct 2005) to support the construction and startup 
of the MBFP coal-to-liquids (CTL) facility, a coal mine and associated 
coal handling facilities in Carbon County, Wyoming (the Facility).
    MBFP proposes to develop the Facility in eastern Carbon County 
north of I-80 between Rawlins and Laramie, Wyoming. The CTL facility 
and coal-handling facility would be located near the mouth of the 
Saddleback Hills Mine, located approximately 6 miles northeast of the 
Town of Elk Mountain and approximately 13 miles southwest of the Town 
of Medicine Bow. The CTL facility would use an advanced industrial 
gasification and liquefaction (IGL) process to convert coal into 
approximately 21,000 barrels per day (bpd) of low-sulfur, low-benzene 
regular gasoline. The Facility would capture at least 50 percent of the 
CO2 and over 99 percent of the sulfur compounds that would 
be otherwise be emitted. The CO2 stream would be compressed 
and delivered at the fenceline to another party for pipeline 
transportation to enhanced oil recovery operations and geologic storage 
at a location to be determined by the offtaker.
    The EIS will evaluate the potential impacts of the issuance of a 
DOE Loan Guarantee for MBFP's proposed project and reasonable 
alternatives.
    The purpose of this Notice of Intent is to inform the public about 
DOE's proposed action, invite public participation in the EIS process, 
announce plans for a public scoping meeting, solicit public comments 
for consideration in establishing the scope and content of the EIS, and 
provide notice of proposed floodplain and wetlands involvement. DOE 
invites those agencies with jurisdiction by law or special expertise to 
be cooperating agencies. The Bureau of Land Management has expressed 
interest in becoming a cooperating agency for this EIS.

DATES: To ensure that all of the potential environmental issues related 
to this proposal are addressed, DOE invites comments on the proposed 
scope and content of the EIS from all interested parties. Comments must 
be postmarked or e-mailed by December 28, 2009 to ensure consideration. 
Late comments will be considered to the extent practicable. In addition 
to receiving written comments (see ADDRESSES below), DOE will conduct a 
public scoping meeting in the vicinity of the proposed project at which 
government agencies, private-sector organizations, and the general 
public are invited to provide comments or suggestions with regard to 
the alternatives and potential impacts to be considered in the EIS. 
Further details about the public scoping meeting will be announced 
through local news media and on the DOE Loan Guarantee Program Office 
Web site

[[Page 62291]]

(http://www.lgprogram.energy.gov/NEPA-2.html) at least 15 days prior to 
the meeting. Advance requests to speak at the public scoping meeting 
may be sent to Ms. Lynn Alexander at the address indicated below prior 
to the meeting. Requests to speak may also be made at the time of 
registration for the meeting. However, persons who submitted advance 
requests to speak will be given priority if time should become limited 
during the meeting.

ADDRESSES: Written comments on the proposed EIS scope and questions 
regarding the public scoping meeting should be addressed to: Ms. Lynn 
Alexander, Loan Guarantee Program Office (CF-1.3), U.S. Department of 
Energy, 1000 Independence Avenue, SW., Washington, DC 20585. Electronic 
submission of comments is encouraged due to processing time required 
for regular mail. Comments can be submitted electronically by e-mail 
to: [email protected]. All comments should reference Project No. DOE/
EIS-0432.

FOR FURTHER INFORMATION CONTACT: To obtain additional information about 
the MBFP project, this EIS, the public scoping meeting, or to receive a 
copy of the draft EIS when it is issued, contact Ms. Lynn Alexander by 
telephone at 202-287-5656, toll-free telephone at 800-832-0885, ext. 
75656, or e-mail at [email protected]. For general information on the 
DOE NEPA process, contact Ms. Carol M. Borgstrom, Director, Office of 
NEPA Policy and Compliance (GC-54), U.S. Department of Energy, 1000 
Independence Avenue, SW., Washington, DC 20585; telephone: 202-586-
4600; facsimile: 202-586-7031; e-mail: [email protected] or leave a 
toll-free message at 800-472-2756.

SUPPLEMENTARY INFORMATION:

Background

    EPAct 2005 established a Federal loan guarantee program for 
eligible energy projects that employ innovative technologies. Title 
XVII of EPAct 2005 authorizes the Secretary of Energy to make loan 
guarantees for a variety of types of projects, including those that 
``avoid, reduce, or sequester air pollutants or anthropogenic emissions 
of greenhouse gases; and employ new or significantly improved 
technologies as compared to commercial technologies in service in the 
United States at the time the guarantee is issued.'' A principal goal 
of the loan guarantee program is to encourage commercial use in the 
United States of new or significantly improved energy-related 
technologies. DOE believes that accelerated commercial use of these new 
or improved technologies will help sustain economic growth, yield 
environmental benefits, and produce a more stable and secure energy 
supply.

Purpose and Need for Agency Action

    MBFP submitted applications to DOE for a loan guarantee to support 
construction and startup of the Facility. The purpose and need for 
agency action is to comply with DOE's mandate under EPAct 2005 by 
selecting eligible projects that meet the goals of the Act. DOE is 
using the NEPA process to assist in determining whether to issue a loan 
guarantee to MBFP to support the proposed project.

Proposed Action

    The DOE proposed action is to issue a loan guarantee to MBFP to 
support construction and startup of the MBFP Facility and coal mine 
near Medicine Bow, Wyoming. The CTL facility and coal mine surface 
facilities would be constructed near the mouth of the Saddleback Hills 
Mine, which is located in eastern Carbon County north of I-80 between 
Rawlins and Laramie, Wyoming, approximately 6 miles northeast of the 
Town of Elk Mountain and 13 miles southwest of the Town of Medicine 
Bow. The MBFP project would be located within the boundary of the 
Carbon Basin Coal Project, which the U.S. Department of the Interior's 
Bureau of Land Management and Office of Surface Mining analyzed in an 
EIS issued in January 1999. The Carbon Basin Coal Project EIS analyzed 
potential environmental impacts and assessed necessary mitigation 
measures for an area that encompasses an Arch Coal, Inc., surface mine 
(The Elk Mountain Mine) that began operations in 2006, and the yet-to-
be-constructed underground Saddleback Hills Mine that MBFP is proposing 
to purchase and construct to supply the bituminous coal needed by the 
MBFP project. The CTL facility would require approximately 200 acres 
and the coal mine surface facilities would require approximately 205 
acres for a total of 405 acres. During construction of the CTL 
facility, there would also be an approximately 338-acre equipment and 
construction laydown area north of the CTL site. All of these parcels 
are within the existing boundaries of the Arch Coal mine property. MBFP 
also proposes to construct two or three short access roads 
(approximately 1 mile total of access roads) from County Road 
3 to the proposed CTL site and use the area between the county 
road and the site as additional temporary construction lay-down area of 
approximately 100 acres, resulting in a total 438 acres of the site 
used as temporary construction lay-down areas.
    As proposed, the CTL facility would use an advanced IGL process to 
convert coal into regular gasoline while capturing and sequestering 
CO2. A total of 450 employees would be required for 
operations at both the CTL facility and the underground Saddleback 
Hills coal mine. The CTL facility would use approximately 9,500 short 
tons (wet basis) per day of bituminous coal to produce approximately 
21,000 bpd of gasoline. The gasoline produced would be delivered to a 
pipeline which would be constructed, owned and operated by a third 
party for transportation to a location near Cheyenne, Wyoming. From 
this location, the gasoline would be transported through an existing 
pipeline to the Denver, Colorado, gasoline market. MBFP would purchase 
the 180 million ton recoverable coal reserve in the Saddleback Hills 
mine, including all existing permits and approximately 18,000 acres of 
land. The project would include construction of a long-wall underground 
coal mine, which has a current mining permit from the Wyoming 
Department of Environmental Quality's Land Quality Division, and coal 
surface facilities, as well as the CTL facility. The coal would be 
transported from the mine via an approximately 1-mile-long conveyor 
system. During construction the peak water use would be less than 1,000 
gallons per minute. During operation the Facility would use 
approximately 300 gallons per minute which would be supplied by wells 
located on the MBFP property or in the northern utility corridor. The 
water source would be the Mesaverde Aquifer which contains non-potable 
water. The raw water would be treated prior to use at the Facility.
    Steam and tail gas produced from the IGL process, as well as 
purchased natural gas, would be used onsite to provide electric power 
for internal Facility use. If additional power is required, it would be 
purchased from the grid. Power would not be sold to the grid. Other by-
products for sale in the market would be elemental sulfur, slag, and 
possibly other chemicals such as propane and butane. Any slag not sold 
for re-use would be sent to a solid waste landfill in the area for 
disposal. An acid gas removal unit removes sulfur compounds from the 
syngas and recovers most of the CO2. The Facility would 
capture at least 50 percent of the CO2 and over 99 percent 
of the sulfur compounds that would be otherwise be emitted.
    Regular-grade gasoline would be the primary product of the 
Facility. The

[[Page 62292]]

gasoline produced at the Facility would be transported offsite to an 
interstate pipeline owned and operated by third parties for delivery to 
the Denver, Colorado, market. A third party would construct, own, and 
operate the gasoline pipeline from the Facility to a location near 
Cheyenne, Wyoming.
    The proposed action would include: construction of a lateral 
pipeline spur to connect to an existing natural gas pipeline; the 
construction of a pipeline from the Facility to Cheyenne for the 
transportation of the gasoline product; one spur pipeline to transport 
the CO2 to a pipeline of the company purchasing the 
CO2 for EOR projects in the state of Wyoming; and several 
interconnects for utilities. The Facility would need to connect to the 
existing power grid for electricity supply, and to route a fiber optics 
cable to an interconnection at the Town of Medicine Bow. All utilities 
would be routed from the Facility through a northern utility corridor.
    For the natural gas supply pipeline, the gasoline product sales 
pipeline, and the CO2 pipeline, there are two optional 
corridor routes that MBFP is considering for the proposed action. In 
option 1, the natural gas, gasoline, and CO2 pipelines would 
be constructed in a western corridor that would cross the MBFP property 
from the Facility going west to connect to an existing pipeline 
corridor parallel to I-80. The natural gas and CO2 pipelines 
would be approximately 8 miles long in option 1, and would connect to 
an existing natural gas pipeline and a proposed CO2 pipeline 
located in the I-80 pipeline corridor. In option 1, the gasoline 
pipeline would be approximately 128 miles long going through the 
western corridor and then along the existing I-80 pipeline corridor to 
Cheyenne. In option 2, the natural gas, gasoline, and CO2 
pipelines would be constructed in an eastern corridor that would go 
southeast from the Facility. The option 2 corridor for the natural gas 
and CO2 pipelines would be approximately 12 miles long and 
would also connect to the existing natural gas pipeline and a proposed 
CO2 pipeline located in the I-80 pipeline corridor. The 
gasoline pipeline in option 2 would be approximately 118 miles long 
going from the Facility, along the eastern corridor, and then along the 
existing I-80 pipeline corridor to Cheyenne.
    A portion of the proposed MBFP site may affect a 100-year 
floodplain. There are also wetlands on the site. Therefore, DOE will 
include in the EIS a floodplain and wetland assessment prepared in 
accordance with the DOE Regulations for Compliance with Floodplain and 
Wetland Environmental Review Requirements (10 CFR part 1022). The 100-
year floodplain is located along Medicine Bow River at the southeast 
boundary of the Carbon Basin Coal Project EIS boundary. One wetland is 
located near where temporary construction lay-down areas may be sited.

Alternatives

    In determining the range of reasonable alternatives to be 
considered in the EIS for the proposed MBFP Facility, DOE identified 
the reasonable alternatives that would satisfy the underlying purpose 
and need for agency action. DOE currently plans to analyze in detail 
the project as proposed by MBFP and the no action alternative. DOE will 
also analyze mitigation measures as appropriate.
    Under the no action alternative, DOE would not provide the loan 
guarantee for the MBFP project and the project would not be constructed 
with the backing of a DOE loan guarantee.

Preliminary Identification of Environmental Issues

    The following environmental resource areas have been tentatively 
identified for consideration in the EIS. This list is neither intended 
to be all-inclusive nor imply a predetermined set of potential 
environmental impacts:
     Air quality
     Greenhouse gas emissions and climate change
     Energy use and production
     Water resources, including groundwater and surface waters
     Wetlands and floodplains
     Geological resources
     Ecological resources, including threatened and endangered 
species and species of special concern
     Cultural resources, including historic structures and 
properties; sites of religious and cultural significance to Tribes; and 
archaeological resources
     Land use
     Visual resources and aesthetics
     Transportation and traffic
     Noise and vibration
     Hazardous materials and solid waste management
     Human health and safety
     Accidents and terrorism
     Socioeconomics, including impacts to community services
     Environmental justice.
    DOE invites comments on whether other resource areas or potential 
issues should be considered in the EIS.

Public Scoping Process

    To ensure that all issues related to the DOE proposed action are 
addressed, DOE seeks public input to define the scope of the EIS. The 
public scoping period will begin with publication of the NOI and end on 
December 28, 2009. Interested government agencies, private sector 
organizations, and the general public are encouraged to submit comments 
concerning the content of the EIS, issues and impacts to be addressed 
in the EIS, and alternatives that should be considered. Scoping 
comments should clearly describe specific issues or topics that the EIS 
should address to assist DOE in identifying significant issues. 
Comments must be postmarked or e-mailed by December 28, 2009 to ensure 
consideration. (See ADDRESSES). Late comments will be considered to the 
extent practicable. DOE invites those agencies with jurisdiction by law 
or special expertise to be cooperating agencies.
    A public scoping meeting will be held in the vicinity of the 
proposed project at a date and time to be determined. Notice of this 
meeting will be provided through local news media and on the DOE Loan 
Guarantee Program Office Web site (http://www.lgprogram.energy.gov/NEPA-2.html) at least 15 days prior to the date of the meeting. Members 
of the public and representatives of groups and Federal, State, local, 
and Tribal agencies are invited to attend. Displays and other forms of 
information about the proposed agency action, the EIS process, and the 
MBFP proposed Facility will be available. DOE personnel will also be 
available at the meeting for discussions with attendees. DOE requests 
that anyone who wishes to present oral comments at the meeting contact 
Ms. Lynn Alexander by phone or e-mail (see ADDRESSES). Individuals who 
do not make advance arrangements to speak may register at the meeting. 
Speakers who need more than five minutes should indicate the length of 
time desired in their request. DOE may need to limit speakers to five 
minutes initially, but will provide additional opportunities as time 
permits. Written comments regarding the scoping process can also be 
submitted to DOE officials at the scoping meeting.

    Issued in Washington, DC, on November 20, 2009.
Steve Isakowitz,
Chief Financial Officer, Office of the Chief Financial Officer.
[FR Doc. E9-28389 Filed 11-25-09; 8:45 am]
BILLING CODE 6450-01-P