[Federal Register Volume 77, Number 73 (Monday, April 16, 2012)]
[Notices]
[Pages 22607-22608]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-8973]


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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[LLWY922000-L57000000-BX0000; WYW176095]


Notice of Competitive Coal Lease Sale, Wyoming

AGENCY: Bureau of Land Management, Interior.

ACTION: Notice.

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

DATES: The lease sale will be held at 10 a.m. on Thursday, May 17, 
2012. Sealed bids must be submitted on or before 4 p.m. on Wednesday, 
May 16, 2012.

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, 
respectively.

SUPPLEMENTARY INFORMATION: This coal lease sale is being held in 
response to a lease by application (LBA) filed by BTU Western 
Resources, Inc., Gillette, Wyoming. The South Porcupine Tract was 
previously offered for sale on February 29, 2012, and the one bid 
received at that sale was rejected because it did not meet the BLM's 
estimate of fair market value. The coal resource to be reoffered 
consists of all reserves recoverable by surface mining methods in the 
following-described lands located approximately 1 to 4 miles north of 
the Campbell/Converse county line, adjacent and up to 2 miles east of 
the main line railroad, and adjacent to the western and northern lease 
boundary of the North Antelope Rochelle Mine.

T. 41 N., R. 70 W., 6th Principal Meridian

Sec. 7, lots 7 through 10 inclusive and lots 15 through 18 
inclusive;
Sec. 18, lots 6 through 11 inclusive and lots 14 through 19 
inclusive;

T. 41 N., R. 71 W., 6th Principal Meridian

Sec. 1, lots 5 through 20 inclusive;
Sec. 12, lots 1 through 16 inclusive;
Sec. 13, lots 1 through 16 inclusive;
Sec. 14, lots 1, 2, 8, 9, 16, and 18;
Sec. 23, lots 1 and 17; and
Sec. 24, lots 2 through 4 inclusive and lots 17, 19, and 21.
    Containing 3,243.03 acres, more or less, in Campbell County, 
Wyoming.

    The LBA tract is adjacent to Federal leases to the east and south 
as well as a State of Wyoming lease to the north, all controlled by the 
North Antelope Rochelle Mine. It is also adjacent to Federal leases to 
the west across the mainline railroad, which is part of Cloud Peak 
Energy Resources, LLC's Antelope Mine. It is adjacent to additional 
unleased Federal coal to the west.
    Most of the acreage offered has been determined to be suitable for 
mining except for the mainline railroad right-of-way along the western 
boundary of the LBA. Features such as roads, utilities, and pipelines 
can be moved to permit coal recovery. In addition, a producing gas well 
is located on the LBA as well as several coal bed natural gas wells.
    The estimate of the bonus value of the coal lease will include 
consideration of the future production from these wells. An economic 
analysis of this future income stream will consider reasonable 
compensation to the gas lessee for lost production of the natural gas 
when the wells are bought out by the coal lessee. Approximately half of 
the surface estate of the tract is within the Thunder Basin National 
Grasslands and managed by the U.S. Forest Service. Most of the other 
half of the surface estate is owned by various private entities with a 
small amount owned by a Peabody Energy Corporation subsidiary.
    The tract contains surface mineable coal reserves in the Wyodak-
Anderson coal zone currently being recovered in the adjacent, existing 
mines. On the LBA tract, there are two mineable seams, the Wyodak-
Anderson 1 (Anderson) and the Wyodak-Anderson 2 (Canyon), located in 
the southern portion of the LBA that merge into a single seam in the 
northern portion. The total coal thickness averages about 77 feet with 
the shallower Anderson seam slightly thicker than the deeper Canyon 
seam where two seams occur.
    The two seams can be separated by as much as 80 feet of 
interburden. Overburden depths to the Anderson range from about 160 to 
460 feet thick.
    The tract contains an estimated 401,830,508 tons of mineable coal. 
This estimate of mineable reserves includes the two seams mentioned 
above but does not include any tonnage from localized seams or splits 
containing less than 5 feet of coal. It does not include the adjacent 
State of Wyoming coal although these reserves are expected to be 
recovered in conjunction with the LBA tract. It also 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 4.8:1. Potential bidders for 
the LBA tract should consider the recovery rate expected from thick and 
multiple seam mining.
    The South Porcupine LBA coal is ranked as subbituminous C. The 
overall average quality on an as-received basis is 8,905 British 
Thermal Units per pound containing about 0.20 percent sulfur. These 
quality averages place the coal reserves near the high end of the range 
of coal quality currently being

[[Page 22608]]

mined in the Wyoming portion of the Powder River Basin.
    The tract in this lease offering contains split estate lands. There 
are qualified surface owners as defined in the regulations at 43 CFR 
3400.0-5(gg). Consent granted by the qualified surface owners has been 
filed with and verified by the BLM. The LBA tract lands included in the 
consent are:

T. 41 N., R. 71 W., 6th Principal Meridian

Sec. 13, lots 12 through 14 inclusive;
Sec. 14, lots 1, 2, 8, and 18; and
Sec. 24, lots 3, 4, 17, 19, and 21.

    Containing 396.79 acres, more or less, in Campbell County, 
Wyoming.

    The purchase price of the consent as stated in the consent 
documents is ``* * * an overriding royalty of three percent (3%) of the 
gross realization of all coal mined and sold from the Subject 
Property.''
    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 (FMV) 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 
Wednesday, May 16, 2012, will not be considered. The minimum bid is not 
intended to represent FMV. The FMV of the tract will be determined by 
the Authorized Officer after the sale. The lease that may be 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. The value of the coal will be determined in accordance 
with 30 CFR 1206.250.
    Pursuant to the regulation at 43 CFR 3473.2(f), the applicant for 
the South Porcupine Tract, BTU Western Resources, Inc., has paid a 
total case-by-case cost recovery processing fee in the amount of 
$83,694. The successful bidder for the South Porcupine Tract, if 
someone other than the applicant, must pay to the BLM the $83,694 
previously paid by BTU Western Resources, Inc., and, in that 
circumstance, the BLM would then refund that amount to BTU Western 
Resources, Inc. Additionally, the successful bidder must pay all 
processing costs the BLM will incur after the date this sale notice is 
published in the Federal Register, which are estimated to be $10,000.
    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, 
WYW176095, are available for inspection at the BLM Wyoming State 
Office.

Donald A. Simpson,
State Director.
[FR Doc. 2012-8973 Filed 4-13-12; 8:45 am]
BILLING CODE 4310-22-P