01-31403. Cancellation of Competitive Coal Lease

AGENCY:

Bureau of Land Management, Interior.

ACTION:

Cancellation of Competitive Coal Lease Offering (NDM 90783) scheduled for December 11, 2001; Request for Public Comment on Fair Market Value and Maximum Economic Recovery; and Notice of Reschedule of the Competitive Coal Lease Offering (NDM 90783) by Sealed Bid.

SUMMARY:

Notice of The Coteau Properties Company's Coal Lease.

The Bureau of Land Management is providing notice of cancellation for the coal lease offering (NDM 90783) by sealed bid scheduled for December 11, 2001. According to Federal coal management regulations at 43 CFR 3422, the BLM must conduct a public hearing for comments on the environmental assessment, the fair market value (FMR), and maximum economic recovery (MER) of the proposed lease tract 30 days prior to holding a lease sale. This required Public Hearing has not occurred. Consequentially, this notice is published to: (1) retract the earlier lease sale date; (2) provide notice for a Public Hearing on the environmental assessment, FMR, and MER; and (3) announce a new date for the coal lease sale.

The lands included in Coal Lease Application NDM 90783 are located in Mercer County, North Dakota. The entire area lies within the Freedom Mine NACT 9501 permit area operated by The Coteau Properties Company.

The coal resource to be offered consists of all recoverable reserves in the following-described lands:

T. 146 N., R. 88 W., 5th P.M.

Sec. 14: SW1/4SW1/4

Sec. 22: N1/2N1/2, SW1/4NE1/4, S1/2NW1/4 excluding a 4.59-acre tract described by metes and bounds and further described as: Beginning at a point on the west line of said Section 22, said point being 250.00 feet north of the southwest corner of the NW1/4 of Section 22; thence north along said west line of Section 22, 500.00 feet; thence east at right angles to the last-described line, 400.00 feet; thence south parallel with said west line, 500.00 feet; thence west at right angles, 400.00 feet to the point of beginning; SW1/4 excluding a 12.61-acre tract described by metes and bounds and further described as: Beginning at the southwest corner of the SW1/4 of said Section 22, thence easterly along the south line of said Section 22, 500.00 feet; thence north at right angles to said south line, 500.00 feet; thence northwesterly to a point on the west line of said Section 22, said point being 1,700.00 feet north of said southwest corner; thence southerly along said west line to the point of beginning; NW1/4SE1/4

502.80 acres—Mercer County, North Dakota

For Coal Lease Application NDM 90783, the recoverable Beulah-Zap seam averages 15.2 feet with an average overburden depth of 61.8 feet. The coal, as received, averages 6,817 BTU/lb in heating 3 value, contains 0.72% sulfur content, 37.5% moisture, 6.81% ash, and 6.11% sodium. The BLM estimates recoverable coal reserves to be approximately 7 million tons.

The public is invited to submit written comments on the fair market value and the maximum economic recovery of the tract. Comments must be received on or before 30 days after the publication date of this notice in the Federal Register.

Notice is also given that a public hearing will be held on the environmental assessment, the proposed sale, and the fair market value and maximum economic recovery of the proposed lease tract at 1 p.m., on Tuesday, January 8, 2002, at the BLM North Dakota Field Office. The environmental assessment is available for review at the BLM North Dakota Field Office, 2933 Third Avenue West, Dickinson, North Dakota. For further information, please contact Lee Jefferis, geologist, at 701-225-7713.

In accordance with the Federal coal management regulations at 43 CFR 3422 and 3425, not less than 30 days prior to the publication of a notice of sale, the Secretary shall solicit public comments on fair market value appraisal and maximum economic recovery and on factors that may affect these two determinations. Proprietary data marked as “confidential” may be submitted to the BLM in response to this solicitation of public comments. Data so marked shall be treated in accordance with the laws and regulations governing the confidentiality of such information. A copy of the comments submitted by the public on fair market value and maximum economic recovery, except those portions identified as proprietary by the author and meeting exemptions stated in the Freedom of Information Act, will be available for public inspection at the BLM, Montana State Office, 5001 Southgate Drive, Billings, Montana, during regular business hours (9 a.m. to 4 p.m.) Monday through Friday.

Comments should be sent to the BLM, Montana State Office, at the above address, and should speak to, but not necessarily be limited to, the following information:

1. The quality of the coal resource;

2. The quantity of coal;

3. The mining method or methods which would achieve maximum economic recovery of the coal, including specification of seams to be mined and the most desirable timing and rate of production;

4. If this tract is likely to be mined as part of an existing mine and, therefore, be evaluated, on a realistic incremental basis, in relation to the existing mine to which it has the greatest value;

5. If this tract should be evaluated as part of a potential larger mining unit and evaluated as a portion of a new potential mine (i.e.; a tract which does not in itself form a logical mining unit);

6. The configuration of any larger mining unit of which the tract may be a part;

7. Restrictions to mining which may affect coal recovery;

8. The price that the mined coal would bring when sold:

9. Costs, including mining and reclamation, of producing the coal and the times of production;

10. The percentage rate at which anticipated income streams should be discounted, either in the absence of inflation or with inflation, in which case the anticipated rate of inflation should be given;

11. Depreciation and other tax accounting factors;

12. The value of any surface estate where held privately;

13. Documented information on the terms and conditions of recent and similar coal land transactions in the lease sale area; and

14. Any comparable sales data of similar coal lands.

The values given above may or may not change as a result of comments received from the public and changes in market conditions between now and when final economic evaluations are completed.

In addition, notice is hereby given that the coal resources in the lands previously described in Mercer County, North Dakota, will be offered for competitive lease by sealed bid on Tuesday, February 12, 2002, in accordance with the provisions of the Mineral Leasing Act of February 25, 1920, as amended (41 Stat, 437; 30 U.S.C. 181 et seq.).

The lease sale will be held at 11 a.m., Tuesday, February 12, 2002, in the BLM Montana State Office 920 conference room, 5001 Southgate Drive, Billings, Montana 59101. Bids for the tract will be in the form of sealed bids. Sealed bids clearly marked “Sealed Bid for NDM90783 Coal Sale—Not to be opened before 11 a.m., Tuesday, February 12, 2002,” must be submitted on or before 10 a.m. Tuesday, February 12, 2002, to the cashier, BLM, Montana State Office, 5001 Southgate Drive, P.O. Box 36800, Billings, Montana 59107-6800.

The tract in this lease offering contains split estate lands. Written consent is on file from all qualified surface owners as defined in the regulations at 43 CFR 3400.0-5.

SUPPLEMENTARY INFORMATION:

The tract will be leased to the qualified bidder of the highest cash amount provided that the high bid meets the fair market value of the coal resource. 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 bid. Bids received after 10 a.m., Tuesday, February 12, 2002, will not be considered. The minimum bid is not intended to represent fair market value. The fair market value will be determined by the authorized officer after the sale.

If identical high bids are received, the tying high bidders will be requested to submit follow-up sealed bids until a high bid is received. All tie-breaking sealed-bids must be submitted within 15 minutes following the Sale Official's announcement at the sale that identical high bids have been received.

A lease 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 payable to the United States of 12.5 percent of the value of coal mined 7 by surface methods and 8.0 percent of the value of coal mined by underground methods. The value of the coal shall 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 included in the Detailed Statement of Lease Sale. Copies of the statement and the proposed coal lease are available at the Montana State Office. Casefile NDM 90783 is also available for public inspection at the Montana State Office.

FOR FURTHER INFORMATION CONTACT:

Connie Schaff (Land Law Examiner) at 406-896-5060, Rebecca Good (Coal Coordinator) at 406-896-5080 or Doug Burger, (North Dakota Field Office Manager) at 701-225-9148.

Dated: December 7, 2001.

Randy D. Heuscher,

Chief, Branch of Solid Minerals.