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Montana/Dakotas State Office
Release Date: 01/17/12
Contacts: Mel Lloyd 406-896-5260    

BLM to Reoffer Coal Resources in Upcoming Lease Sale

The Bureau of Land Management (BLM) will hold a competitive coal lease sale by sealed bid at 11 a.m. on Tuesday, February 28, 2012. The sale will be held in the 920 conference room at the BLM Montana/Dakotas State Office, 5001 Southgate Drive, Billings, Mont.

The sale is a reoffer of the coal lease the BLM offered on November 16, 2011. Signal Peak Energy LLC submitted the only and high bid of $5,325,000 ($0.15 per recoverable ton) for five unleased coal tracts in Musselshell County. After careful evaluation by an interdisciplinary team, the BLM rejected the bid because it did not meet or exceed BLM’s estimate of the fair market value of the tracts. In early December, Signal Peak Energy LLC requested that the BLM Montana/Dakotas offer the coal lease tracts for sale again, and the BLM agreed to do so.

The 2,679.86-acre tract in Musselshell County contains an estimated 35.5 million tons of recoverable coal reserves. The tracts will be offered for lease to the qualified high bidder provided the high bid meets or exceeds BLM’s estimate of the fair market value of the tracts.  The minimum bid for these tracts is $100 per acre, or fraction thereof.  The minimum bid is not intended to represent fair market value.

The Musselshell County tracts are being offered for sale in response to a lease by application (LBA) filed by Signal Peak Energy LLC. The coal resource to be offered consists of all reserves recoverable by underground mining methods.  The tracts are located approximately 12 miles south of Roundup, Mont. and are adjacent to the existing Bull Mountains Mine No 1.

Once a lease is issued, an annual rental payment of $3 per acre is required, along with a royalty payment of 8 percent of the value of coal produced by underground mining methods.  Approximately 50 percent of the bonus and royalty payments are shared with the state of Montana.

Sealed bids must be submitted to the Cashier, BLM Montana/Dakotas State Office, 5001 Southgate Drive, Billings, MT 59101. Bids must be received no later than 10 a.m. on February 28, 2012.
For more information, or to obtain further bidding instructions, please contact Greg Fesko, Coal Program Coordinator, at 406-896-5080.

The BLM manages more than 245 million acres of public land, the most of any Federal agency. This land, known as the National System of Public Lands, is primarily located in 12 Western states, including Alaska. The BLM also administers 700 million acres of sub-surface mineral estate throughout the nation. The BLM's mission is to sustain the health, diversity, and productivity of America’s public lands for the use and enjoyment of present and future generations. In Fiscal Year 2015, the BLM generated $4.1 billion in receipts from activities occurring on public lands.

Montana/Dakotas State Office   5001 Southgate Dr.      Billings, MT 59101  

Last updated: 06-28-2012