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BLM Holds Coal Lease Sale on Millfork West Tract

The Bureau of Land Management offered one tract in the coal lease sale held on Aug. 1.

Offered by sealed bid, the Mill Fork West Tract was leased for $458.87 per acre, for a total of $98,000, by PacifiCorp. Fifty percent of all revenues gained from this coal energy lease sale will be shared with Utah. The leased tract, which contains 213.6 acres, shows potential for economic coal production and is in conformance with the Lease by Application sale criteria.

One of the important criteria is that tracts nominated for leasing are determined to be environmentally suitable. In addition, this lease allows underground recovery of coal during a mining operation that would otherwise be lost. There will be no surface mining activities required to recover this coal.

BLM has responsibility for coal leasing on about 468 million acres nationwide and 118 million acres within the State of Utah where the coal mineral estate is managed by the federal government.

Coal is a natural fossil fuel composed mainly of carbon, hydrogen and oxygen. It provides about 95 percent of Utah's electrical energy needs completely from secure domestic sources. Other important users of coal include alumina refineries, paper manufacturers, and the chemical and pharmaceutical industries.

Thousands of different products include coal or coal by-products components including soap, aspirins, solvents, dyes, and plastics. More than a third of the nation's coal production comes from federal coal leases. Utah produced about 24.5 million tons in 2005, with 80 percent coming from federal leases.

Revenues gained from leasing federal coal include a bonus bid paid at the time a lease is issued. There are also rental payments used to continue to hold the lease, and royalties are received on the value of the coal after it has been mined.

To learn more about the Federal Coal Leasing Program visit our website at: www.ut.blm.gov/solidminerals/coal/coalfacts.htm





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