Obama administration halts new coal leases

Companies that already hold federal coal leases, such as Peabody Energy Corp., can continue to mine those reserves during and after the moratorium.

Officials at the Interior Department, which oversees the leasing of public lands to energy companies for fossil fuel extraction, have been reviewing for the past year possible updates to the leasing and royalty programs for mining and drilling on government lands.

This is the first major review of the country’s coal program in three decades.

The review will look at such issues as how, when and where to lease, how to account for the public health impacts of coal, and how to ensure American taxpayers earn a fair return on their resources.

The Energy Information Administration says roughly 41 percent of USA coal production occurs on federal land. The vast majority comes from Wyoming, Montana, Colorado, Utah and New Mexico.

The new plan will examine the impacts that the federal coal leasing program has on the environment, including climate change, sources familiar with the plan told Reuters.

The evaluation will also consider whether the government is getting a fair price for leases, answering concerns from the Government Accountability Office and elsewhere that lease sales aren’t competitive enough and that coal companies find ways to pay reduced prices for the coal. But even if that’s true, we have a president that’s actually doing something to break America’s fossil fuel addiction.

But the announcement will no doubt please environmental groups that have long said the government’s fee rates encouraged production of a product that contributed to global warming.

The federal coal leasing program has come under scrutiny from public interest groups and government investigators, who fault the government for selling coal for less than its full market value.

The Interior Department said the proposed rule would require companies to restore streams and return mined areas to a condition capable of supporting the land uses available before mining activities took place. Industry groups counter that any increase in royalty rates will hurt consumers and threaten high-paying jobs. He said the administration would “push to change the way we manage our oil and coal resources, so that they better reflect the costs they impose on taxpayers and our planet”.

The Bureau of Land Management, which oversees the program, also will be required to publicly post requests to lease coal or reduce royalties.

House Speaker Paul Ryan (R-Wis.) blasted the move as an attack on communities that rely on coal mining for their economies. “Unfortunately, the president is intent on destroying coal as a domestic energy source”, Mooney said.

Michael Brune, executive director of the Sierra Club, applauded the administration’s action. “Thanks to the Obama administration’s leadership, we can proudly say that Big Coal’s destructive reach over our public lands is coming to an end”.