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Notice of Competitive Coal Lease Sale, Wyoming

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Bureau of Land Management, Interior.


Notice of competitive coal lease sale.


Notice is hereby given that certain coal resources in the NARO South Tract described below in Campbell and Converse Counties, WY, will be offered for competitive lease by sealed bid in accordance with the provisions of the Mineral Leasing Act of 1920, as amended (30 U.S.C. 181 et seq.).


The lease sale will be held at 10 a.m., on Tuesday, June 29, 2004. Sealed bids must be submitted on or before 4 p.m., on Monday, June 28, 2004.


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

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Mavis Love, Land Law Examiner, or Robert Janssen, Coal Coordinator, at 307-775-6258, and 307-775-6206, respectively.

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This coal lease sale is being held in response to a lease by application (LBA) filed by Powder River Coal Company of Gillette, WY. The coal resources to be offered consist of all reserves recoverable by surface mining methods in the following-described lands located along the county line in southeastern Campbell County and northeastern Converse County approximately five miles east of State Highway 59, 14 miles south of State Highway 450, and adjacent to the Burlington Northern Santa Fe/Union Pacific joint rail line:

T. 41 N., R. 70 W., 6th PM, Wyoming

Sec. 19: Lots 6-11, 12(S1/2), 13-20;

Sec. 20: Lots 5(S1/2), 6(S1/2), 7(S1/2), 8(S1/2), 9-16;

Sec. 21: Lots 5(S1/2), 12, 13;

Sec. 28: Lots 3-6, 11, NE1/4SW1/4;

Sec. 29: Lots 1-12;

Sec. 30: Lots 5-12;

T. 41 N., R. 71 W., 6th P.M, Wyoming

Sec. 23: Lots 8(S1/2), 9;

Sec. 24: Lots 1, 5(S1/2), 6(S1/2), 7(S1/2), 8-16;

Sec. 25: Lots 1-4, 9-10, 12(N1/2).

Containing 2,956.725 acres, more or less.

The tract is adjacent to Federal coal leases held by the North Antelope Rochelle Mine to the northeast and by the Antelope Mine to the south and west. It is also adjacent to additional unleased Federal coal to the north.

All of the acreage offered has been determined to be suitable for mining except lands within 100 feet of the joint rail line right-of-way. Other features such as the county road, pipelines, and power lines can be moved to permit coal recovery. Numerous oil and/or 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. An economic analysis of this future income stream will determine whether a well is bought out and plugged prior to mining or re-established after mining is completed. Small portions of the surface estate of the tract are owned by the North Antelope Rochelle Mine and the Antelope Mine, but most of the surface estate is owned by private individuals.

The tract contains surface mineable coal reserves in the Wyodak seam currently being recovered in the adjacent, existing mines. On the tract, the Wyodak seam is generally split into the Anderson and Canyon seams. The upper Anderson seam averages about 37 feet thick and the lower Canyon seam averages about 34 feet thick on the LBA. Burn lines near the southern and eastern boundaries of the LBA tract mark the approximate limits of the coal seams. The overburden depths range from about 95-260 feet thick on the LBA. The interburden between the Anderson and Canyon seams ranges from 5-115 feet thick on the LBA.

The tract contains an estimated 297,469,000 tons of mineable coal. This estimate of mineable reserves includes the Anderson and Canyon seams mentioned above but does not include any tonnage from localized seams or splits containing less than 5 feet of coal. The total mineable stripping ratio (BCY/Ton) of the coal is about 2.8:1. Potential bidders for the LBA should consider the recovery rate expected from thick seam, multiple seam, and burn line mining. The NARO South LBA coal is ranked as subbituminous C. The overall average quality on an as-received basis is 8929 BTU/lb with about 0.2% sulfur and 2% sodium in the ash. These quality averages place the coal reserves near the high end of the range of coal quality currently being 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. Consent granted by the qualified surface owners has been filed with and verified by the BLM. The lands included in the consent are shown below:

T. 41 N., R. 70 W., 6th P.M., Wyoming

Sec. 19: Lots 6-11, 12(S1/2), 13, 14, 19, 20;

Sec. 30: Lots 5, 6;

T. 41 N., R. 71 W., 6th P.M., Wyoming

Sec. 24: Lots 5(S1/2), 6(S1/2), 7(S1/2), 8-11, 13-16.

The purchase price of the consent is $10.00 and 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 equals 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 Cashier will issue a receipt for each hand-delivered bid. Bids received after 4 p.m., on Monday, June 28, 2004, 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 $3.00 per acre, or fraction thereof, and of a royalty payment to the United States of 12.5 percent of the value of coal produced by strip or auger mining methods and 8 percent of the value of the coal produced by underground mining methods. The value of the coal will be determined in accordance with 30 CFR 206.250.

Bidding instructions for the tract offered and the terms and conditions of the proposed coal lease are available from the BLM Wyoming State Office at the addresses above. Case file documents, WYW154001, are available for inspection at the BLM Wyoming State Office.

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Phillip C. Perlewitz,

Acting Deputy State Director, Minerals and Lands.

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[FR Doc. 04-11572 Filed 5-26-04; 8:45 am]