Tag Archives: Peabody Energy

5/24/2012 ALEC Exposed: Peabody Energy

10/17/2011 Navajo Times: Changes aim to protect cash from spending

10/17/2011 Navajo Times: Changes aim to protect cash from spending By Marley Shebala: There’s nearly $45 million in the tribe’s Undesignated Unreserved Fund but it may not be there for long if the Navajo Nation Council approves amendments to the Appropriations Act next week. Twelve members of the Nabik’yati’ Committee voted Tuesday to give the amendments a do-pass recommendation, making its passage a good bet during the Council’s fall session next week. The amendments, sponsored by Lorenzo Curley (Houck/Klagetoh/Nahata Dziil/Tse si’ani/Wide Ruins) would expand Ð instead of waiving – rules limiting the Council’s ability to spend the money, most of which is a one-time cash infusion from settlement of a lawsuit against Peabody Energy.

The intention is to protect the money from the chaotic methods of passing supplemental spending bills used in past years, said one Council leader, although some provisions would arguably reduce some restraints imposed under the current law.

The amendments moved at warp speed through the committee process, with the Budget and Finance Committee and the Law and Order Committee meeting during the Nabik’yati’ Committee’s lunch break to review the legislation, which they both gave a “do-pass” recommendation.

The proposed amendments would add language to the Appropriations Act that would allow the Council to make supplemental appropriations earlier in the budget year.

The current budget year started Oct. 1 and ends Sept. 30, 2012.

The tribe’s spending law now prohibits the Council from making supplemental appropriations until projected revenues are met and the UUF, the tribe’s rainy day fund, has a minimum balance equal to 10 percent of the prior fiscal year’s budget.

In this case, that would be $17 million since the 2011 budget was $170 million.

The projected revenues for the 2011 budget were not realized until August, two months before the end of the budget year.

The Appropriations Act also mandates that any amendments to it must come from the Council’s Budget and Finance Committee, of which Curley is a member.

In presenting his bill to the committee Tuesday, said the reason for the amendments is to update the law and move supplemental appropriations legislation more efficiently through the legislative review process.

“These amendments make it simpler and easier for the Council to serve the needs of more constituents,” he added.

B&F committee Chair LoRenzo Bates (Nenahnezad/Newcomb/San Juan/T’iistoh Sikaad/Tse Daa K’aan/Upper Fruitland) said in a separate interview that the move to streamline the process for supplemental spending began as soon as the delegates learned that the UUF, which for the last couple of years has been millions in the red, now contained close to $40 million.

Bates, who has championed spending restraint during his years in the Council, said the amendment process was initiated to prevent a repeat of past years where last-minute spending requests would come from the Council floor with little or no explanation or justification.

Approval depended more on the political clout of the sponsor than on the proposal’s merit, with massive expenditures involving a little sugar for every chapter being particularly popular.

Bates also noted that the law currently requires the B&F Committee to hold hearings on the annual budget and supplemental spending bills, although the Law & Order Committee recommended that this responsibility be ceded to the Nabik’yati’ Committee, to which all the delegates belong.

Bates said that the committee’s proposed supplemental spending process would set priorities for allocating funds, such as the Peabody settlement, that are a one-time windfall.

Among the potential competition for supplemental spending are all three branches of the tribal government, which got significantly less than their stated need in the current budget.

According to President Ben Shelly’s 2011 budget message, the executive branch is short by about $65 million.

The much-smaller judicial branch’s unmet needs totaled about $1.6 million, according to previous statements by Chief Justice Herb Yazzie.

9/19/2011 Gallup Independent: Peabody seeks permit renewal for Kayenta Mine

9/19/2011 Gallup Independent: Peabody seeks permit renewal for Kayenta Mine By Kathy Helms, Dine Bureau: WINDOW ROCK – Peabody Western Coal Co. has filed an application with the Office of Surface Mining Reclamation and Enforcement to renew its permit for mining operations at Kayenta Mine through July 5, 2015. Peabody submitted an application to OSM to renew the permit in February 2010, and proposes to continue mining in coal resource areas N-9, J-19, and J-21 from July 6, 2010, through July 5, 2015. The proposed permit renewal does not include any revisions to the mining and operations plan or the addition of any new mining areas.

“The Kayenta Mine is moving through a routine five-year permit renewal process covering the mine plan, land restoration plan and other activities related to ongoing operations, which is consistent with current operations,” Beth Sutton, director of Corporate Communications for Peabody Energy, said.

OSM has prepared an environmental assessment to evaluate environmental effects from the permit renewal. Comments must be submitted by Oct. 22 to be considered.

The Kayenta Mine permit area is located on approximately 44,073 acres of land leased from the Navajo Nation and the Hopi Tribe. Peabody holds leases to mine up to 670 million tons of coal from reserves within the permit area. As of July 2010, 20,851 acres within the permit area had been disturbed.

Mining activities within the lease area would result in a moderate, short-term impact, according to OSM and would disturb 1,159 acres of land used for grazing and traditional land uses. However, the federal agency said reclamation of the disturbed areas would improve the productivity and quality of grazing lands.

“The mine has a record of good environmental compliance, and typically returns mined lands to a condition that is as much as 20 times more productive for rangeland than native areas,” Sutton said.

Within the J-21 coal resource area, four of the 83 occupied houses within the Kayenta Mine permit area would be relocated. Residents would be compensated for the replacement of all structures and for lost grazing acreage if they can establish a customary use area claim.

According to the Finding of No Significant Impact, Peabody has committed to replace three windmill wells that have or would be removed by mining. Any other water supply that could be adversely impacted by mining during the five-year permit term would be replaced.

Annual groundwater use for domestic and mine-related purposes from the Navajo aquifer would average 1,236 acre-feet per year, or 70 percent less than was used prior to 2006 when the coal slurry pipeline was operating.

Water quantity use impacts to the N-aquifer are expected to be negligible to minor, and no endangered or threatened species are expected to be directly affected because there is no predicted decrease of flows in seeps and springs associated with the N-aquifer, OSM said. Pumping has been primarily occurring within the confined part of the N-aquifer, and the agency said water levels are rising or are predicted to rise because less groundwater is being used since the coal slurry pipeline was discontinued.

The number of people employed at the Kayenta Mine will increase from 422 in 2010 to 432 in 2015. The average annual revenue paid to the tribes from 2005-2009 was $43.2 million, plus an additional average annual payment of $6.2 million to Navajo Tribal Utility Authority and scholarship funds, according to OSM. These revenues are expected to continue.

“Kayenta Mine is a powerful economic force in the region creating 400 jobs and nearly $370 million in direct and indirect economic benefits for regional communities,” Sutton said. “We look forward to an efficient and timely review as part of the customary stakeholder process.”

Kayenta Mine ships approximately 8 million tons of coal annually to Navajo Generating Station.

Information: http://www.wrcc.osmre.gov/Current_Initiatives/Kayenta_Mine/Renewal.shtm or (303) 293-5035. E-mail comments to kayentarenewalea@osmre.gov

8/18/2011 Navajo Times: Peabody, tribe mum on lawsuit settlement

8/18/2011 Navajo Times: Peabody, tribe mum on lawsuit settlement by Marley Shebala: The settlement of the Navajo Nation’s $1.8 billion Racketeering Influenced and Corrupt Organizations Act lawsuit against coal giant Peabody Energy and its partners Salt River Project and Southern California Edison was quietly announced by Peabody in a two-page statement posted on its Web site Aug. 4. The Navajo Nation was just as quiet in announcing the end of the largest damage suit in its history, although the settlement immediately grabbed national media attention.

Both the tribe and the defendants said the settlement ended a $600 million lawsuit, though the tribe had estimated total damages as high as $1.8 billion when it first filed the suit 12 years ago.

It took the Navajo Nation Council, which recently voted not to raise the royalty rate Peabody pays on Black Mesa coal, a week to issue its own one-page press release about the historic settlement.

It was a contrast to June 17, 1999, when the tribe held a press conference and issued several press releases a day after the lawsuit was filed in federal court.

Kelsey Begaye and Edward T. Begay, then Navajo Nation president and Council speaker, respectively, expressed their outrage over what they said was a conspiracy to rob the tribe of legitimate income from coal resources on Black Mesa.

The trigger was Peabody’s successful effort to prevent the Interior Department from supporting the tribe’s effort to raise royalty rates to 20 percent, nearly twice what the company considered acceptable.

“This lawsuit has been filed to right a serious wrong against the Navajo Nation and its people,” Begaye said. “The damage caused by Peabody’s influence peddling is staggering.

“Since 1984, the Navajo Nation has suffered losses of $600 million,” he said. “While the defendants reap huge and illicit profits using Navajo coal to generate electricity for homes and businesses in Southern California, Las Vegas and Arizona, thousands of Navajo homes are still without electricity.”

“We will not be cheated any longer,” Begay said. “Coal represents the Navajo Nation’s most valuable natural resource. This lawsuit will restore lost revenues to the Navajo Nation and place us on the road to achieve economic self- sufficiency for our people.

“We are not asking for a handout,” he added. “We are demanding to be compensated equitably by American corporations and treated fairly by the United States government.”

Friends again

The current leaders took a far different tone.

8/8/2011 Gallup Independent: Navajo reaches accord with Peabody

8/8/2011 Gallup Independent: Navajo reaches accord with Peabody By Kathy Helms, Dine Bureau: WINDOW ROCK – The Navajo Nation has reached a settlement agreement with Peabody Energy, Salt River Project and Southern California Edison on the 1999 Navajo royalty litigation, it was announced Thursday in a joint press release published by PRN Newswire. Terms of the agreement are confidential, however, information obtained by the Independent indicates the settlement is worth $65 million to Navajo. Upon signing of the agreement, the Nation was expected to receive a $50 million cash lump sum with an additional $1.5 million – or $300,000 each – for 10 years earmarked for the five affected chapters of Black Mesa, Forest Lake, Kayenta, Chilchinbeto, and Shonto. The $50 million would be considered excess revenue and would go to the General Fund, minus funds for mandatory set-asides. It would be up to Council to determine how the excess revenue would be spent.

The settlement was negotiated on behalf of the Navajo Nation by Attorney General Harrison Tsosie. Others involved in the discussions were Council Delegates Leonard Tsosie and Katherine Benally of the Resources and Development Committee, and Jonathan Nez and LoRenzo Bates of the Budget and Finance Committee.

Though there were no immediate press releases issued by the Navajo Nation, Attorney General Tsosie stated in the joint release that “the Navajo Nation is pleased the parties were able to come together in a spirit of cooperation to settle this long-standing litigation.”

In 1999, Navajo sued the United States in the Court of Federal Claims seeking $600 million in damages and alleging violations of the Racketeering Influenced and Corrupt Organizations Act. Navajo claimed that then-Secretary of the Interior Don Hodel had been improperly influenced by Peabody when he approved coal royalty lease amendments in 1987. The Supreme Court ruled in April 2009 to reverse the decision of the U.S. Court of Appeals that allowed the Nation to pursue its claim for breach of trust against the United States.

As part of the case against the United States there was an allegation that Navajo should have received a 20 percent coal royalty rather than the 12.5 percent of gross proceeds determined in 1987. The director of the Bureau of Indian Affairs for the Navajo Area issued an opinion letter imposing a new rate of 20 percent but Peabody filed an administrative appeal and while it was pending, the tribe and the company reached a negotiated agreement to set a rate of 12.5 percent. As a result, the area director’s decision was vacated, the administrative appeal was dismissed, and the Secretary approved the amendments to the lease. The settlement announced Thursday stems from litigation over that matter.

Peabody has mined coal on Black Mesa under two leases with the tribe since the mid-1970s. A portion of the coal went to Southern California Edison, which was co-owner and operating agent of Mohave Generating Station in Laughlin, Nev., before the plant closed in December 2005. Salt River Project is the operating agent for Navajo Generating Station, which uses coal from Peabody’s Kayenta Mine.

“Peabody is pleased to have successfully concluded these important agreements, and looks forward to our future collaborative efforts with the Navajo Nation for the long-term benefit of tribal people,” Peabody Senior Vice President for Southwest Operations G. Brad Brown said.

“Mining on Black Mesa is a major economic staple, contributing more than $12 billion in direct and indirect economic benefits to the region since the operations began.” Peabody noted that the settlement was reflected in the company’s second quarter 2011 financial statements.

The Navajo Nation Council also recently approved the 2007 lease reopener with Peabody and allocated $5.2 million of the revenue for the Many Mules Water Project. The reopener agreement is worth $3.5 million per year to Navajo, in addition to a signing bonus and scholarship money.