[Federal Register Volume 76, Number 200 (Monday, October 17, 2011)]
[Pages 64099-64100]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-26744]



Bureau of Land Management

[LLWY922000-L13200000-EL0000; WYW174596]

Notice of Competitive Coal Lease Sale, Wyoming

AGENCY: Bureau of Land Management, Interior.

ACTION: Notice of competitive coal lease sale.


SUMMARY: Notice is hereby given that certain coal resources in the 
South Hilight Field Coal Tract described below in Campbell County, 
Wyoming, will be offered for competitive lease by sealed bid in 
accordance with the provisions of the Mineral Leasing Act of 1920, as 

DATES: The lease sale will be held at 10 a.m. on Wednesday, December 
14, 2011. Sealed bids must be submitted on or before 4 p.m. on Tuesday, 
December 13, 2011.

ADDRESSES: The lease sale will be held in the First Floor Conference 
Room (Room 107) of the Bureau of Land Management (BLM) Wyoming State 
Office, 5353 Yellowstone Road, P.O. Box 1828, Cheyenne, Wyoming 82003. 
Sealed bids must be submitted to the Cashier, BLM Wyoming State Office, 
at the address given above.

FOR FURTHER INFORMATION CONTACT: Mavis Love, Land Law Examiner, or 
Kathy Muller Ogle, Coal Coordinator, at 307-775-6258, and 307-775-6206, 

SUPPLEMENTARY INFORMATION: This coal lease sale is being held in 
response to a lease by application (LBA) filed by Ark Land Company, St. 
Louis, Missouri. The coal resource to be offered consists of all 
reserves recoverable by surface mining methods in the following 
described lands located 2 to 5 miles south of State Highway 450 and 
east of the Burlington Northern/Union Pacific main line railroad.

T. 43 N., R. 71 W., 6th Principal Meridian
    Sec. 23, lots 1 through 16 inclusive;
    Sec. 26, lots 1 through 16 inclusive;
    Sec. 35, lots 1 through 16, inclusive.

    Containing 1,976.69 acres, more or less, in Campbell County, 

    The tract is adjacent to the southern and western lease boundary of 
the Black Thunder Mine. The tract is adjacent to Federal leases to the 
east and north controlled by the Black Thunder mine as well as an 
adjacent State of Wyoming lease also controlled by the Black Thunder 
mine. It is adjacent to additional unleased Federal coal to the west 
and south.

[[Page 64100]]

    Most of the acreage offered has been determined to be suitable for 
mining. The acreage coincident with the main line railroad right-of-way 
along the western boundary of the tract is not suitable for mining. 
Features such as utilities and pipelines can be moved to permit coal 
recovery. In addition, numerous producing coal bed natural gas wells 
have been drilled on the tract. The estimate of the bonus value of the 
coal lease will include consideration of the future production from 
these wells and the successful coal lessee's interaction with gas 
producers regarding any pre-existing rights of such producers. An 
economic analysis of this future income stream will consider reasonable 
compensation for lost production when the wells are bought out since 
mining will eliminate the gas reservoir. Some of the surface estate of 
the tract is owned by Thunder Basin Coal Company, but most of the 
surface is part of the Thunder Basin National Grassland managed by the 
United States Forest Service.
    The tract contains surface mineable coal reserves in the Wyodak-
Anderson coal zone currently being recovered in the adjacent, existing 
mine. On the LBA tract, there are generally two recoverable seams, the 
shallower Upper Wyodak and the deeper Middle Wyodak. The Upper Wyodak 
is found in the northern third of the LBA and averages about 13 feet 
thick. The Middle Wyodak is the primary coal seam and is continuous 
over the entire LBA. It varies from 67 feet to 75 feet thick. The 
interburden between the Upper and Middle Wyodak seams varies in 
thickness from 41 feet to 118 feet. There are up to three thin seams 
that split from the bottom of the Middle Wyodak which are generally 
mineable only when they are merged with the Middle Wyodak seam. 
Overburden depths to the top of the Upper Wyodak seam range from about 
170 feet to 400 feet on the LBA.
    The tract contains an estimated 222,676,000 tons of mineable coal. 
This estimate of mineable reserves includes both of the seams mentioned 
above but does not include any tonnage from localized seams or splits 
containing less than 5 feet of coal. The estimated reserve excludes 
coal within and along the railroad right-of-way as required by typical 
mining practices. The total mineable stripping ratio of the coal in 
bank cubic yards per ton is approximately 4.2:1. Potential bidders for 
the LBA should consider the recovery rate expected from thick seam and 
multiple seam mining.
    The South Hilight Field LBA coal is ranked as subbituminous C. The 
overall average quality on an as-received basis is 9,011 British 
Thermal Units per pound containing approximately 0.27 percent sulfur. 
These quality averages place the coal reserves at the high end of the 
range of coal quality currently being mined in the Wyoming portion of 
the Powder River Basin.
    The tract will be leased to the qualified bidder of the highest 
cash amount provided that the high bid meets or exceeds the BLM's 
estimate of the fair market value of the tract. The minimum bid for the 
tract is $100 per acre or fraction thereof. No bid that is less than 
$100 per acre, or fraction thereof, will be considered. The bids should 
be sent by certified mail, return receipt requested, or be hand 
delivered. The BLM Wyoming State Office Cashier will issue a receipt 
for each hand-delivered bid. Bids received after 4 p.m. local time, on 
Tuesday, December 13, 2011, will not be considered. The minimum bid is 
not intended to represent fair market value. The fair market value of 
the tract will be determined by the Authorized Officer after the sale. 
The lease issued as a result of this offering will provide for payment 
of an annual rental of $3 per acre, or fraction thereof, and a royalty 
payment to the United States of 12.5 percent of the value of coal 
produced by surface mining methods. No coal is to be mined by 
underground methods since the only coal resources to be offered are 
those coal resources recoverable by surface mining methods. The value 
of the coal will be determined in accordance with 30 CFR 206.250.
    This LBA was initiated before the case-by-case cost recovery fees 
at 43 CFR 3473.2(f) became effective. Therefore, case-by-case 
processing fees are not applicable to this lease sale. See 43 CFR 
    Bidding instructions for the LBA tract offered and the terms and 
conditions of the proposed coal lease are available from the BLM 
Wyoming State Office at the address above. Case file documents, 
WYW174596, are available for inspection at the BLM Wyoming State 

Donald A. Simpson,
State Director.
[FR Doc. 2011-26744 Filed 10-14-11; 8:45 am]