Notice of Competitive Coal Lease Sale Maysdorf II North, WY, 41946-41947 [2013-16629]

Agencies

• DEPARTMENT OF THE INTERIOR
• Bureau of Land Management

[Federal Register Volume 78, Number 134 (Friday, July 12, 2013)]
[Notices]
[Pages 41946-41947]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-16629]


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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[LLWY922000-L57000000-BX0000; WYW173360]


Notice of Competitive Coal Lease Sale Maysdorf II North, WY

AGENCY: Bureau of Land Management, Interior.

ACTION: Notice.

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SUMMARY: Notice is hereby given that certain coal resources in the 
Maysdorf II North 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 
amended.

[[Page 41947]]


DATES: The lease sale will be held at 10 a.m. on Wednesday, August 21, 
2013. Sealed bids must be submitted on or before 4 p.m. on Tuesday, 
August 20, 2013.

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 Cordero Mining LLC, 
Gillette, Wyoming. The coal resource to be offered consists of all 
reserves recoverable by surface mining methods in the following-
described lands located approximately 15 miles south-southeast of 
Gillette, Wyoming, immediately east of State Highway 59, west of the 
Cordero Rojo Mine, and south of the Belle Ayr Mine.

Sixth Principal Meridian

T. 47 N., R. 71 W.,
    Sec. 7, lots 6 to 11, inclusive, and lots 14 to 19, inclusive.
T. 47 N., R. 72 W.,
    Sec. 1, lots 9 to 13, inclusive, and NW\1/4\SE\1/4\;
    Sec. 12, lots 1 to 12, inclusive, and lots 14 to 16, inclusive.

    The areas described aggregate 1,338.37 acres.

    The tract is adjacent to a Federal lease to the east controlled by 
the Cordero Rojo Mine, to a Federal lease to the north controlled by 
the Belle Ayr Mine, and to the Maysdorf II South Coal Tract to the 
southeast awaiting a future lease sale. The LBA is adjacent to 
additional unleased Federal coal to the west across State Highway 59. A 
qualified surface owner restricts leasing on the Maysdorf II North 
Tract toward the south. Most of the acreage offered has been determined 
to be minable except for the State Highway 59 right-of-way and 100 foot 
buffer along the western boundary of the LBA. Acreage south of the LBA 
has been removed from the application due to the lack of qualified 
surface owner consent; however, the economic analysis of the bonus 
value for the LBA coal along this southern boundary includes a 
reasonable cost to acquire an overstrip agreement toward the end of 
mine life in order to mine the last of the LBA coal. Reasonable costs 
to move features such as utilities and pipelines to allow coal recovery 
have also been included in the economic analysis. In addition, numerous 
oil and 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 to the gas 
lessee for lost production of the natural gas when the wells are bought 
out by the coal lessee. Most of the surface estate of the tract is 
owned by Alpha Coal West, Inc., with a small portion in the southeast 
corner owned by Caballo Rojo, Inc.
    The LBA tract contains surface mineable coal reserves in the Wyodak 
Coal Zone currently being recovered in the adjacent, existing mines. 
Several beds are merged on the LBA tract into a single mineable seam. 
The average total coal thickness is approximately 69 feet and the range 
of overburden thickness is approximately 266 to 397 feet. The tract 
contains an estimated 148,565,000 tons of mineable coal. This estimate 
of mineable reserves includes the main seam mentioned above but does 
not include any tonnage from localized seams or splits containing less 
than 5 feet of coal. It also excludes coal within and along the highway 
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 4.5:1. Potential bidders for the LBA should consider the 
recovery rate expected from thick seam mining.
    The Maysdorf II North LBA coal is ranked as subbituminous C. The 
overall average quality on an as-received basis is 8,602 British 
Thermal Units per pound containing approximately 0.24 percent sulfur. 
These quality averages place the coal reserves near the middle 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 (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 
Tuesday, August 20, 2013, 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 Maysdorf II North Tract, Cordero Mining LLC, has paid a total case-
by-case cost recovery processing fee in the amount of $86,165. The 
successful bidder for the Maysdorf II North Tract, if someone other 
than the applicant, must pay to the BLM the $86,165 previously paid by 
Cordero Mining, LLC. 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, 
WYW173360, are available for inspection at the BLM Wyoming State 
Office.

Nancy L. Beres,
Acting State Director.
[FR Doc. 2013-16629 Filed 7-11-13; 8:45 am]
BILLING CODE 4310-22-P