BLM Announces Largest Federal Coal Lease Sale in Colorado History

On May 31, 2000, two federal coal sales were held at the Bureau of Land Management's (BLM) State Office in Lakewood, Colorado. Bowie Resources was the successful high bidder in the Iron Point Tract sale (3,210.82 acres, 32.60 million tons). Oxbow Mining, Inc. was the successful high bidder in the Elk Creek Tract sale (4,443.57 acres, 20.92 million tons). The two federal underground coal tracts are located near Paonia, Colorado.

Bowie Resources submitted a bid of $3,218.57 per acre for a total of $10,334,200 and Oxbow Mining, Inc. submitted a bid of $1,963.02 per acre for a total of $8,723,661. Each bid met the required fair market value for the federal coal resource. The combined bid of $19 million represents the largest coal resource bonus collected from public lands in Colorado history. Production from these federal tracts over the next 5-8 years will generate an estimated royalty stream of $70,000,000 into the Federal Treasury. The State of Colorado will receive half of all bonus and royalties (over $44 million).

The coal leases were offered for sale after completion of a joint BLM/Forest Service North Fork Environmental Impact Statement. The success of these coal lease sales was also due in part to the North Fork Coal Working Group who established a successful partnership in addressing local concerns.

Total Colorado coal production in 1999 was approximately 30 million tons. Eighty-three percent of this production, or 25 million tons, comes from federal leases. Annual production in the North Fork Valley will increase from 10 to 15 million tons over the next eight years. 

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