Horse Creek Tract, Wyoming

AGENCY:

Bureau of Land Management, Interior.

ACTION:

Notice of competitive coal lease sale.

SUMMARY:

Notice is hereby given that certain coal resources in the Horse Creek Tract described below in Campbell and Converse Counties, Wyoming, will be offered for competitive lease by sealed bid in accordance with the provisions of the Mineral Leasing Act of 1920, as amended (30 U.S.C. 181 et seq.).

DATES:

The lease sale will be held at 2 p.m., on Thursday, September 7, 2000. Sealed bids must be submitted on or before 4 p.m., on Wednesday, September 6, 2000.

ADDRESSES:

The lease sale will be held in the First Floor Conference Room (Room 107) of the BLM, Wyoming State Office, 5353 Yellowstone Road, P.O. Box 1828, Cheyenne, Wyoming 82003. Sealed bids must be submitted to the Cashier, BLM, Wyoming State Office, at the address given above.

FOR FURTHER INFORMATION CONTACT:

Mavis Love, Land Law Examiner, or Melvin Schlagel, Coal Coordinator, at (307) 775-6258 and (307) 775-6257, respectively.

SUPPLEMENTARY INFORMATION:

This coal lease sale is being held in response to a lease by application (LBA) filed by Antelope Coal Company of Gillette, Wyoming. The coal resources to be offered consist of all reserves recoverable by surface mining methods in the following-described lands located on the border of Campbell and Converse Counties, approximately 20 miles southeast of Wright, Wyoming:

T. 41 N., R. 71 W., 6th P.M., Wyoming

Sec. 14: Lots 5, 6, 7 (W2), 10-15;

Sec. 15: Lots 6-11, 14-16;

Sec. 22: Lots 1, 3-6, 9-13;

Sec. 23: Lots 2-7, 10-16;

Sec. 25: Lots 11, 12 (S2);

Sec. 26: Lots 1-8, 12, 13;

Sec. 27: Lots 1-3, 5, 12-14, 16;

Sec. 34: Lots 1, 7-10, 16;

Sec. 35: Lots 8-10.

Containing 2,818.695 acres.

All of the acreage offered has been determined to be suitable for mining except for areas located within 100 feet of the main railroad right-of-way along the tract's eastern edge. The surface estate of the tract is controlled by Antelope Coal Company and a private owner. There are no oil and gas wells on the tract.

The tract is adjacent to the Antelope mine and contains surface minable coal reserves in two primary seams currently being recovered in this mine. The Anderson seam averages about 39 feet thick and the Canyon seam averages about 33 feet thick on the LBA. The Anderson has a split averaging just over 5 feet thick in small portions of the LBA and the Canyon has two splits averaging just over 12 and 17 feet thick in small portions of the LBA. The overburden above the main seams is up to 300 feet thick on the LBA along the northern boundary with the Anderson seam outcropping along Antelope Creek. Interburden between the primary seams ranges between 25-90 feet thick.

The Horse Creek LBA coal is ranked as subbituminous C. The overall average quality of the in-place reserves is 8890 BTU/lb, 26.83% moisture, 4.28% ash, 0.22% sulfur, and 1.49% sodium in the ash. These quality averages place the coal reserves at the high end of the range of coal quality currently being mined in the southern Powder River Basin south of Wright, Wyoming.

The tract contains an estimated 275,577,000 tons of minable coal in the Anderson and Canyon seams. This estimate of reserves includes the splits off the main seams mentioned above but does not include any tonnage from localized seams or splits containing less than 5 feet of coal. Potential bidders must reduce this estimate to account for mining losses associated with multiple seam recovery. In addition, coal reserves along the eastern boundary of the tract within 100 feet of the railroad right-of-way have been excluded from the minable reserves.

Finally, the approved mine plan for the Antelope mine avoids disturbing the Antelope Creek Valley, so any coal resources beneath Antelope Creek have been excluded. The cumulative stripping ratio for the minable reserves is approximately 2.6:1 (BCY/Ton) which includes overburden and interburden.

The tract in this lease offering contains split estate lands. There are qualified surface owners as defined in the regulations at 43 CFR 3400.0-5. Consent granted by the qualified surface owners has been filed with and verified by the Bureau of Land Management. The lands included in the consent are shown below:

T. 41 N., R. 71 W., 6th P.M., Wyoming

Sec. 14: Lots 5, 6, 7(W2), 11-14;

Sec. 15: Lots 6-11, 14-16;

Sec. 22: Lots 4-6, 10, 11;

Sec. 23: Lots 3-6.

Containing 999.945 acres more or less.

The purchase price of the consent is set out in Exhibit B, Agreement for the Purchase and Sale of Real Estate, attached to the Qualified Surface Owner Consent document.

The tract will be leased to the qualified bidder of the highest cash amount provided that the high bid equals the fair market value of the tract and other applicable requirements are met. 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. The Cashier will issue a receipt for each hand-delivered bid. Bids received after 4 p.m., on Wednesday, September 6, 2000, will not be considered. The minimum bid is not intended to represent fair market value. The fair market value of the tract will be determined by the Authorized Officer after the sale.

The lease issued as a result of this offering will provide for payment of an annual rental of $3 per acre, or fraction thereof, and of a royalty payment to the United States of 12.5 percent of the value of coal produced by strip or auger mining methods and 8 percent of the value of the coal produced by underground mining methods. The value of the coal will 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 available from the BLM, Wyoming State Office at the addresses above. Case file documents, WYW141435, are available for inspection at the BLM, Wyoming State Office.