HAY CREEK II ROD

APPENDIX 2

BUREAU OF LAND MANAGEMENT

SPECIAL COAL LEASE STIPULATIONS

AND COAL LEASE FORM 3400-12
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SPECIAL STIPULATIONS

In addition to observing the general obligations and standards of performance set out in the 

current regulations, the lessee shall comply with and be bound by the following special 

stipulations. 

These stipulations are also imposed upon the lessee's agents and employees. The failure or 

refusal of any of these persons to comply with these stipulations shall be deemed a failure of 

the lessee to comply with the terms of the lease. The lessee shall require his agents, 

contractors and subcontractors involved in activities concerning this lease to include these 

stipulations in the contracts between and among them. These stipulations may be revised or 

amended, in writing, by the mutual consent of the lessor and the lessee at any time to adjust to 

changed conditions or to correct an oversight.

(a) CULTURAL RESOURCES

(1) Before undertaking any activities that may disturb the surface of the leased lands, the 

lessee shall conduct a cultural resource intensive field inventory in a manner specified by 

the Authorized Officer of the BLM or of the surface managing agency, if different, on 

portions of the mine plan area and adjacent areas, or exploration plan area, that may be 

adversely affected by lease-related activities and which were not previously inventoried at 

such a level of intensity. The inventory shall be conducted by a qualified professional 

cultural resource specialist (i.e., archeologist, historian, historical architect, as appropriate), 

approved by the Authorized Officer of the surface managing agency (BLM, if the surface is 

privately owned), and a report of the inventory and recommendations for protecting any 

cultural resources identified shall be submitted to the Regional Director of the Western 

Region of the Office of Surface Mining (the Western Regional Director), the Authorized 

Officer of the BLM, if activities are associated with coal exploration outside an approved 

mining permit area (hereinafter called Authorized Officer), and the Authorized Officer of the 

surface managing agency, if different. The lessee shall undertake measures, in 

accordance with instructions from the Western Regional Director, or Authorized Officer, to 

protect cultural resources on the leased lands. The lessee shall not commence the surface 

disturbing activities until permission to proceed is given by the Western Regional Director 

or Authorized Officer.

2) Any existing Class III inventory report covering the lease area that has not received 

federal agency review must be reviewed and accepted by the agency, site National 

Registry of Historical Places eligibility determinations made, and consultation with the State 

Historic Preservation Officer completed before any surface disturbing activities take place.

(3) The lessee shall protect all cultural resource properties that have been determined 

eligible or unevaluated to the National Register of Historic Places within the lease area from 

lease-related activities until the cultural resource mitigation measures or site evaluations 

can be implemented as part of an approved mining and reclamation or exploration plan 
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unless modified by mutual agreement in consultation with the State Historic Preservation 

Officer.

(4) The cost of conducting the inventory, preparing reports, and carrying out mitigation 

measures shall be borne by the lessee.

(5) If cultural resources are discovered during operations under this lease, the lessee shall 

immediately bring them to the attention of the Western Regional Director or Authorized 

Officer, or the Authorized Officer of the surface managing agency, if the Western Regional 

Director is not available. The lessee shall not disturb such resources except as may be 

subsequently authorized by the Western Regional Director or Authorized Officer. Within 

two (2) working days of notification, the Western Regional Director or Authorized Officer will 

evaluate or have evaluated any cultural resources discovered and will determine if any 

action may be required to protect or preserve such discoveries. The cost of data recovery 

for cultural resources discovered during lease operations shall be borne by the lessee 

unless otherwise specified by the Authorized Officer of the BLM or of the surface managing 

agency, if different.

(6) All cultural resources shall remain under the jurisdiction of the United States until 

ownership is determined under applicable law.

(b) PALEONTOLOGICAL RESOURCES 

If paleontological resources, either large and conspicuous, and/or of significant scientific value 

are discovered during mining operations, the find will be reported to the Authorized Officer 

immediately. Mining operations will be suspended within 250 feet of said find. An evaluation 

of the paleontological discovery will be made by a BLM-approved professional paleontologist 

within five (5) working days, weather permitting, to determine the appropriate action(s) to 

prevent the potential loss of any significant paleontological value. Operations within 250 feet 

of such discovery will not be resumed until written authorization to proceed is issued by the 

Authorized Officer. The lessee will bear the cost of any required paleontological appraisals, 

surface collection of fossils, or salvage of any large conspicuous fossils of significant scientific 

interest discovered during the operations.

(c) THREATENED, ENDANGERED, CANDIDATE, or OTHER SPECIAL STATUS PLANT 

and ANIMAL SPECIES

The lease area may now or hereafter contain plants, animals, or their habitats determined to 

be threatened or endangered under the Endangered Species Act of 1973, as amended, 16 

U.S.C. 1531 et seq., or that have other special status. The Authorized Officer may 

recommend modifications to exploration and development proposals to further conservation 

and management objectives or to avoid activity that will contribute to a need to list such 
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species or their habitat or to comply with any biological opinion issued by the Fish and Wildlife 

Service for the Proposed Action. The Authorized Officer will not approve any grounddisturbing activity that may affect any such species or critical habitat until it completes its 

obligations under applicable requirements of the Endangered Species Act. The Authorized 

Officer may require modifications to, or disapprove a proposed activity that is likely to result in 

jeopardy to the continued existence of a proposed or listed threatened or endangered species, 

or result in the destruction or adverse modification of designated or proposed critical habitat.

The lessee shall comply with instructions from the Authorized Officer of the surface managing 

agency (BLM, if the surface is private) for ground disturbing activities associated with coal 

exploration on federal coal leases prior to approval of a mining and reclamation permit or 

outside an approved mining and reclamation permit area. The lessee shall comply with 

instructions from the Authorized Officer of the Office of Surface Mining Reclamation and 

Enforcement, or his designated representative, for all ground disturbing activities taking place 

within an approved mining and reclamation permit area or associated with such a permit.

Any potential habitat that has not already been surveyed for Ute ladies’ tresses within the 

project area shall be identified and surveyed prior to surface mining activities.

(d) MULTIPLE MINERAL DEVELOPMENT

Operations will not be approved which, in the opinion of the Authorized Officer, would 

unreasonably interfere with the orderly development and/or production from a valid existing 

mineral lease issued prior to this one for the same lands.

(e) OIL AND GAS/COAL RESOURCES

The BLM realizes that coal mining operations conducted on Federal coal leases issued within 

producing oil and gas fields may interfere with the economic recovery of oil and gas, just as 

Federal oil and gas leases issued in a Federal coal lease area may inhibit coal recovery. BLM 

retains the authority to alter and/or modify the resource recovery and protection plans for coal 

operations and/or oil and gas operations on those lands covered by Federal mineral leases so 

as to obtain maximum resource recovery.

(f) RESOURCE RECOVERY AND PROTECTION

Notwithstanding the approval of a resource recovery and protection plan (R2P2) by the BLM, 

the lessor reserves the right to seek damages against the operator/lessee in the event (i) the 

operator/lessee fails to achieve maximum economic recovery (MER) (as defined at 43 CFR 
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3480.0-5(21)) of the recoverable coal reserves or (ii) the operator/lessee is determined to have 

caused a wasting of recoverable coal reserves. Damages shall be measured on the basis of 

the royalty that would have been payable on the wasted or unrecovered coal.

The parties recognize that under an approved R2P2, conditions may require a modification by 

the operator/lessee of that plan. In the event a coal bed or portion thereof is not to be mined or 

is rendered unmineable by the operation, the operator/lessee shall submit appropriate 

justification to obtain approval by the Authorized Officer to leave such reserves unmined. 

Upon approval by the Authorized Officer, such coal beds or portions thereof shall not be 

subject to damages as described above. Further, nothing in this section shall prevent the 

operator/lessee from exercising its right to relinquish all or portion of the lease as authorized by 

statute and regulation.

In the event the Authorized Officer determines that the R2P2, as approved, will not attain MER 

as the result of changed conditions, the Authorized Officer will give proper notice to the 

operator/lessee as required under applicable regulations. The Authorized Officer will order a 

modification if necessary, identifying additional reserves to be mined in order to attain MER. 

Upon a final administrative or judicial ruling upholding such an ordered modification, any 

reserves left unmined (wasted) under that plan will be subject to damages as described in the 

first paragraph under this section.

Subject to the right to appeal hereinafter set forth, payment of the value of the royalty on such 

unmined recoverable coal reserves shall become due and payable upon determination by the 

Authorized Officer that the coal reserves have been rendered unmineable or at such time that 

the operator/lessee has demonstrated an unwillingness to extract the coal.

The BLM may enforce this provision either by issuing a written decision requiring payment of 

the Office of Natural Resources Revenue demand for such royalties, or by issuing a notice of 

non-compliance. A decision or notice of non-compliance issued by the lessor that payment is 

due under this stipulation is appealable as allowed by law.

(g) PUBLIC LAND SURVEY PROTECTION

The lessee will protect all survey monuments, witness corners, reference monuments, and 

bearing trees against destruction, obliteration, or damage during operations on the lease 

areas. If any monuments, corners or accessories are destroyed, obliterated, or damaged by 

this operation, the lessee will hire an appropriate county surveyor or registered land surveyor 

to reestablish or restore the monuments, corners, or accessories at the same location, using 

surveying procedures in accordance with the "Manual of Surveying Instructions for the Survey 

of the Public Lands of the United States." The survey will be recorded in the appropriate 

county records, with a copy sent to the Authorized Officer.
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(h) BUFFER ZONES FOR RIGHTS-OF-WAY OF PUBLIC ROADS, SCHOOL BUILDINGS, 

AND OCCUPIED DWELLINGS

(1) No mining activity of any kind may be conducted within the Collins or McGee road rights-ofway and associated 100-foot buffer zones. The lessee shall recover all legally and 

economically recoverable coal from all leased lands not within the foregoing rights-of-way and 

associated buffer zones. Provided a permit to move the roads is approved by the Campbell 

County Board of Commissioners, the lessee shall recover all legally and economically 

recoverable coal from all leased lands within the foregoing rights-of-way and associated buffer 

zones. The lessee shall pay all royalties on any legally and economically recoverable coal that 

it fails to mine without the written permission of the Authorized Officer.

(2) No mining activity of any kind may be conducted within occupied residence and associated 

300-foot buffer zone. The lessee shall recover all legally and economically recoverable coal 

from all leased lands not within the foregoing occupied residence and associated buffer zone. 

The lessee shall pay all royalties on any legally and economically recoverable coal that it fails 

to mine without the written permission of the Authorized Officer.
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