On January 4, the Bureau of Land Management (BLM) held a competitive coal lease sale by sealed bid for the Greens Hollow Coal Tract, a 6,175.39-acre area in Sanpete and Sevier counties, Utah. The site is estimated to contain approximately 55.7 million tons of recoverable coal and is adjacent to the SUFCO mine, which contains other federal coal leases.
The BLM received one bid from Canyon Fuels Company LLC, out of Grand Junction, Colorado, for $22.85 million, or $3,700.17 per acre. The result is only preliminary and will not be confirmed until the BLM sale panel determines if the bid meets or exceeds the estimated fair market value for the coal resource in the Greens Hollow Tract. A date has not been set for the sale panel meeting, however, it will be conducted as soon as possible.
If the BLM sale panel determines that a high bid meets or exceeds fair market value, the BLM will issue the lease after the Department of Justice has been allowed 30 days to conduct an antitrust review of the bidder’s coal holdings. When a coal lease is issued, an annual rental payment of $3 per acre is required, along with a royalty payment of 8% of the value of coal produced by underground mining methods.