Montana News

Powder River Basin ranchers want investigation of coal mine royalties

Posted: Jan 4, 2013 7:58 PM by MTN News

BILLINGS - Farmers and ranchers living in the Powder River Basin of Montana and Wyoming welcome a congressional investigation into whether U.S. taxpayers are receiving full royalties from coal mined on federal lands.

U.S. Senate Energy Committee Chair Ron Wyden (D-Ore.) and ranking member Lisa Murkowski (R-Alaska) are concerned about the return to taxpayers from the sale of federal coal.

That concern follows media reports and studies citing flaws in the federal coal royalty collection process.

"Montanans have a lot of questions about the impacts of mining our coal, shipping it to West Coast ports, and sending it to customers in Asia," said Walter Archer, a rancher from Olive, Montana, and Chair of the Northern Plains Resource Council.

"There is no question that taxpayers deserve a full and fair royalty payment when their coal is mined," said Archer.

"If the only way coal companies can make money is to get this coal on the cheap from taxpayers, and send it overseas, that is a very bad deal all the way around," Archer said.

Recent Reuters news agency reports investigating how Arch Coal Inc., Peabody Energy, and Cloud Peak Energy account for royalties on federal coal from the Powder River Basin coal sold to Asian markets.

A study by the Institute for Energy Economics and Financial Analysis found taxpayers may have missed out on an estimated $28.9 billion in revenues over 30 years dye to a failure by the Bureau of Land Management to get fair market value for federal coal mined in the Powder River Basin.

"Neighbors to Wyoming coal mines, like my family, have sacrificed a lot for Wyoming to be the nation's leader in coal production," said L.J. Turner, cattle and sheep rancher, from Wright, Wyoming, and member of the Powder River Basin Resource Council.

"We deserve to know that we're not getting short-changed by the coal companies," said Turner.

"We hope the Department of the Interior acts in the public interest and seriously considers the Senators' concerns," Turner said.

In April, Massachusetss democrat Ed Markey asked the Government Accountability Office (GAO) to review the federal coal leasing programm, noting that the last review of the program occurred in 1984.

The GAO is conducting that review, and the Interior Department's Office of Inspector General is also investigating the federal coal leasing program.

Last month, a GAO report raised concerns about management of royalty revenue from oil, gas, coal, and hard-rock minerals from federal lands.