Amid Skepticism from Navajo Nation, Study Deems Cloud Peak Coal Mines Purchase ‘Prudent’

(Casper Star Tribune, September 28) – Of the dozen coal mines peppered throughout Wyoming’s mineral-laden Powder River Basin, a majority have undergone changes in ownership throughout the years, often as a result of companies sliding in and out of bankruptcy

This year was no exception.

A handful of new coal operators have descended on the basin to vie for control of five of the basin’s thermal coal mines.

The Navajo Nation-based company said it hopes to close the sale in early October. But the investment has faced mounting criticism from Diné communities. Many fear the investment is too risky for the tribal enterprise, especially during a time when demand for Powder River Basin coal wanes.

But the company has been steadfast in its belief that the purchase will generate millions of dollars in revenue for the Navajo Nation. To prove its point, the company assessed the financial viability of the three thermal coal mines in a study published Thursday. The purchase of the three mines is a “prudent” decision, the study concluded.

Prepared by Energy Ventures Analysis, a consulting firm, the analysis concluded the basin will continue to pump out coal at a healthy annual rate of at least 250 million tons of coal for decades to come. Two of the mines fall within Wyoming’s borders and produced a combined 35.8 million tons of coal last year, according to the Wyoming Mining Association.

Recent shifts in the basin, like the partial closure of the Blackjewel coal mines and merging of Peabody Energy and Arch Coal facilities under one roof, make it an optimal time for NTEC to enter the basin, the study stated. And international coal exports from the Montana-based Spring Creek Mine could generate substantial profit for the company too.

“As a Navajo owned company, we are expanding our reach internationally,” Clark Moseley, the CEO of the company, said in a statement. “The demand for clean high-quality coal will continue for the foreseeable years making the Cloud Peak asset acquisition a sound investment for NTEC and the country as we will help fuel a reliable, cost effective and environmentally conscious foundation of all energy development.”

What’s more, “NTEC is purchasing these mines at a very low cost,” the study stated.

NTEC received court approval to purchase the mines last month. According to the sale terms, it will make a $15.7 million cash payment for the three mines, in addition to a $40 million second lien promissory note and royalties payments for coal produced over the next five years. The coal company will also assume $94 million in pre- and post-petition taxes.


But some analysts and members of the Navajo Nation were not convinced by the rosy report. Many remain concerned about what they see as risks associated with the purchase.

“We still have a lot of questions, concerns and frustrations with the lack of transparency to the Navajo public, our communities and to the council,” said Robyn Jackson, climate and energy outreach coordinator of Diné C.A.R.E., an organization on the Navajo Nation advocating for Diné communities and the environment.