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WYW173360 and WYW180711 

Mule Deer on Reclaimed Rangeland Reclaimed Belle Fourche River 

Coal Creek Mine, Wyoming Cordero Rojo Mine, Wyoming 

Reclaimed Tisdale Creek American Avocet in a Reclaimed Wetland 

Caballo Mine, Wyoming Belle Ayr Mine, Wyoming 

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The BLM’s multiple-use mission is to sustain the health and productivity of the 

public lands for the use and enjoyment of present and future generations. The 

Bureau accomplishes this by managing such activities as outdoor recreation, 

livestock grazing, mineral development, and energy production, and by conserving 

natural, historical, cultural, and other resources on public lands. 

%/0:<3/
 

 

 

U.S. DEPARTMENT OF THE INTERIOR
 

BUREAU OF LAND MANAGEMENT
 

RECORD OF DECISION
 

MAYSDORF II LEASE BY APPLICATION
 

WYW173360 AND WYW180711
 

CAMPBELL COUNTY, WYOMING
 

INTRODUCTION 

On September 1, 2006, Cordero Mining Company (CMC) filed an application with BLM 

to lease the Federal coal included in a tract west and south of and immediately adjacent 

to the Cordero Rojo Mine in Campbell County, Wyoming, approximately 15 miles southsoutheast of Gillette (Appendix 1, Figure 1). The Federal coal reserves were applied for 

as a maintenance tract for the Cordero Rojo Mine, which is operated by CMC, a directly 

held subsidiary of Rio Tinto Energy America (formerly Kennecott Energy and Coal 

Company). On November 21, 2011 tracts were delineated from the study area 

associated with the Maysdorf II LBA tract such that all surface which did not obtain 

surface owner consent was removed and the remaining the area was delineated into a 

north tract containing one parcel and a south tract containing three parcels. The 

application was made pursuant to the Leasing on Application regulations found in the 

Code of Federal Regulations at 43 CFR Subpart 3425.1. The delineated north tract, 

which was assigned case file number WYW173360, is referred to as the Maysdorf II 

Lease by Application (LBA) North tract. The delineated south tract, which was assigned 

case file number WYW180711, is referred to as the Maysdorf II LBA South tract. 

Cordero Mining Company has applied to lease Federal coal reserves in order to extend 

the life of the Cordero Mine. The BLM refers to these types of applications as 

maintenance tracts. A maintenance tract is a tract of Federal coal that is adjacent to, 

and can be mined by, an existing active coal mine. As applied for, the Maysdorf II LBA 

includes a total of approximately 4653.8 acres (Appendix 1, Figure 2). Cordero Mining 

Company estimates the as applied for tract includes approximately 504 million tons of in 

place Federal coal in Campbell County, Wyoming. 

The Maysdorf II LBA has been evaluated in an environmental impact statement (EIS) 

containing the Maysdorf II LBA and three other LBAs adjacent to one another in the 

middle group of mines in the south Gillette area in the Powder River Basin, Wyoming. 

The group EIS is the South Gillette Area Coal Lease Applications EIS (hereafter 

referred to as the South Gillette Area Coal EIS). Under Alternative 3 for the Maysdorf II 

LBA, BLM considered adding all or part of the BLM study area to the tract as applied 

for, splitting the revised tract into two tracts (Maysdorf II LBA North and Maysdorf II LBA 

South) and offering one or both of those tracts for sale. Two separate competitive 

sealed bid lease sales would be held. The Maysdorf II LBA North tract consists of one 

contiguous block of Federal coal; the Maysdorf II LBA South tract consists of three noncontiguous blocks of Federal coal. Alternative 3 assumes that the applicant would be 

the successful bidder on the tracts, and that the tracts would be mined as maintenance 

1
 
 

 

 

leases for the existing Cordero-Rojo Mine. According to the applicant, the Cordero-Rojo 

Mine needs the Federal coal included in the Maysdorf II North and South coal lease 

tracts in order to extend the life of the mine. The applicant would recover the Federal 

coal using the same methodology, machinery, and facilities that are currently being 

used to recover the coal in the existing Cordero-Rojo Mine coal leases. Cordero Mining 

Company anticipates that, if they acquire the leases for the Maysdorf II LBA North and 

South tracts, it could extend the mine life by approximately 9.9 years. The CorderoRojo Mine has a permit to conduct mining operations approved by the Wyoming 

Department of Environmental Quality Land Quality Division (WDEQ/LQD) and as 

provided for by the Mineral Leasing Act (MLA) of 1920, as amended, and a mining plan 

approved by the Secretary of the Interior to conduct surface coal mining operations on 

their existing coal leases. The mine complies with the requirements of the Clean Air Act 

(CAA) through an air quality permit approved by the Air Quality Division of the Wyoming 

Department of Environmental Quality (WDEQ/AQD) which currently allows mining of up 

to 65 million tons of coal per year. In the environmental impact statement the estimated 

production by the year 2015 at the Cordero-Rojo Mine has been assumed to increase to 

39 million tons of coal per year and remain at that rate through the year 2020. 

BLM administers the Federal Coal Leasing Program under the MLA as amended and 

the Federal Coal Leasing Amendments Act (FCLAA) of 1976. If any proposed lease 

tract contains surface lands which are under the jurisdiction of any Federal agency other 

than the Department of the Interior (USDI) or are occupied by a qualified surface owner, 

that agency or individual must consent to the issuance of the lease, and in the case of 

the Federal agency prescribe the terms and conditions to be imposed on that lease (43 

CFR 3400.3-1 and 3420.4-2 and 3427.1). The Maysdorf II LBA North tract, as 

configured does not include any surface held in Federal ownership. Under BLM’s 

Maysdorf II LBA North tract delineation, surface ownership consists of private lands 

owned by Alpha Coal West, Inc. and a subsidiary of Cloud Peak Energy. The Maysdorf 

II LBA South tract, as configured, consists of private lands owned by subsidiaries of 

Cloud Peak Energy and 284.96 acres of Federal lands administered by the BLM. 

BACKGROUND 

Lease by Application Process 

In the Powder River Basin (PRB), maintenance tracts are nominated for leasing by 

companies operating adjacent existing mines. To process an LBA, the BLM must 

evaluate the quantity, quality, maximum economic recovery (MER), and fair market 

value (FMV) of the Federal coal. The BLM must also evaluate the environmental and 

socioeconomic impacts of leasing and mining the Federal coal in accordance with the 

requirements of the National Environmental Policy Act of 1969 (NEPA). BLM prepared 

the South Gillette Area Coal EIS to evaluate and disclose potential impacts of leasing 

the Federal coal included in the Maysdorf II coal lease application. Although leasing the 

Maysdorf II LBA North and or South tract would not authorize mining operations on the 

2
 
 

 

 

 

 

 

 

 

tract, the EIS evaluates the potential impacts of mining the Maysdorf II LBA because 

mining is a logical consequence of issuing a lease for a maintenance tract of Federal 

coal. 

The Office of Surface Mining Reclamation and Enforcement (OSM) is a cooperating 

agency on the South Gillette Area Coal Lease EIS because OSM is the Federal agency 

with the primary responsibility to administer programs that regulate surface coal mining 

in accordance with Section 503 of the Surface Mining Control and Reclamation Act of 

1977 (SMCRA). OSM also recommends approval, approval with conditions, or 

disapproval of the MLA mining plan to the Assistant Secretary of the Interior, Lands and 

Minerals Management. 

The WDEQ and the Wyoming Department of Transportation (WDOT) are also 

cooperating agencies on this EIS. WDEQ has a cooperative agreement with the 

Secretary of the Interior to regulate surface coal mining operations on Federal and nonFederal lands within the State of Wyoming. WDEQ regulates airborne emissions in 

Wyoming and administers the air quality standards approved by the Environmental 

Protection Agency (EPA). The responsibilities of the WDOT include, but are not limited 

to, management, planning, and oversight of state roads and highways. 

By law and regulation, the LBA process is an open, public, competitive sealed-bid 

process. Bidding at any potential sale is not restricted to the applicant. In order for 

BLM to award and issue a coal lease, the highest bid received must meet or exceed the 

fair market value of the coal as determined by BLM’s economic evaluation. 

Cordero Mining Company filed the Maysdorf II LBA because the area applied for is 

adjacent to their existing approved mining operations at the Cordero-Rojo Mine and the 

Federal coal can be mined using their existing mine facilities, equipment, and 

employees. As shown in Appendix 1, Figure 1, the Cordero-Rojo Coal mine and related 

Maysdorf II LBA are adjacent to one another. In the South Gillette Area Coal EIS, the 

alternatives that are analyzed in detail assume that the applicant will be the successful 

bidder if a competitive sale is held. 

History of Coal Leasing Activity in the Wyoming Portion of the Decertified Powder 

River Coal Region 

Since decertification of the Powder River Coal Region in 1990, 26 Federal coal leases 

in Campbell and Converse counties, Wyoming, have been issued under the LBA 

process with competitive sealed-bid sales. These leases include approximately 

61,833.43 surface acres and approximately 7,176,711,524 tons of mineable coal. 24 of 

the new leases were issued to the following existing mines for the purpose of extending 

operations at those mines: Jacobs Ranch (now Black Thunder)(2), Black Thunder (4), 

North Antelope Rochelle (3), Eagle Butte (2), Antelope (5), Buckskin (1), Cordero/Rojo 

(2), Belle Ayr (1), Caballo (2), and School Creek (the former North Rochelle) (2). The 

remaining two leases, the West Rocky Butte and the West Roundup, were issued to 

companies intending to open new mines. The West Rocky Butte lease was issued to 

3
 
 

 

 

 

 

 

 

Northwestern Resources Company in 1992. They planned to start a new mine to 

recover the coal included in the Rocky Butte and West Rocky Butte leases but the new 

mine was never developed. The Rocky Butte and West Rocky Butte leases are now 

held by Caballo Coal Company, a subsidiary of Peabody Energy Corporation (PEC), 

and are included in the Caballo Mine. The West Roundup lease was issued to West 

Roundup Resources, Inc., a subsidiary of PEC, and has been incorporated into the 

recently permitted School Creek Mine. 

Pending Coal Leasing Applications and Other Proposed Projects in the Wyoming 

Powder River Basin 

There are seven pending maintenance lease applications in the Wyoming portion of the 

PRB, including the Maysdorf II LBA tracts (Appendix 1, Figure 1). As applied for, the 

pending coal lease applications include approximately 27,167.03 acres and 3,532 

million tons of Federal coal. In addition to the Maysdorf II LBA, the pending LBAs and 

the applicant mines are: North Hilight Field (Black Thunder Mine), West Hilight Field 

(Black Thunder Mine), Hay Creek II (Buckskin Mine), West Jacobs Ranch (Jacobs 

Ranch Mine – prior to Arch purchase) Belle Ayr West (Belle Ayr Mine) and Antelope 

Ridge (Antelope Mine). 

Oil and gas leasing and development have occurred in this area in addition to coal 

leasing and mining. Both conventional and coalbed natural gas (CBNG) wells have 

been drilled in and around the Cordero-Rojo Mine and the Maysdorf II LBA area. 

Conventional and CBNG resources are currently being recovered from Federal and 

private oil and gas leases in the application area. Federal oil and gas lease ownership 

in the Maysdorf II LBA area is described in Figure 3-39 and Table 3-17 of the Final EIS. 

Federal oil and gas lessees and private interests identified by the applicant were 

included on the mailing list for the South Gillette Area Coal EIS. 

The EIS discusses energy development in and around the Maysdorf II LBA tract. The 

discussion includes a summary of the results of an analysis of the conventional oil and 

gas drilling that has occurred in the area, prepared by the BLM Wyoming Reservoir 

Management Group (WSO-RMG). The analysis found that there are active 

conventional oil or gas wells on lands included in the Maysdorf II study area, Proposed 

Action, and Alternatives 1, 2 and 3. The Cordero-Rojo Mine has obtained mine-over 

rights for all oil and gas installations within the tract and study area. 

The EIS also includes a summary of the results of the BLM WSO-RMG analysis of the 

coal bed natural gas (CBNG) resources in the area. At the Cordero-Rojo Mine, the 

mineable coal seams are the Wyodak-Anderson coal zone. In this area, CBNG has 

been produced from the Wyodak-Anderson zone since the late 1980s. The WSO-RMG 

analysis indicated that in the Wyodak-Anderson zone underlying the Cordero-Rojo 

Mine, CBNG depletion had already occurred before accelerated CBNG development 

began in the region in the late 1990s. Recoverable Methane in the coals in the 

Maysdorf II LBA will be nearly completely removed by the CBNG operators before 

mining occurs. This will result in the reduction of the amount of methane released into 

4
 
 

 

 

the atmosphere by coal exposed during mining. The EIS identifies CBNG wells on 

lands included in the BLM study area of the Maysdorf II LBA and the operating status of 

those wells. The remaining CBNG wells can continue to operate in advance of the coal 

mining operation until the wells become prepared for mine-over. 

Several mechanisms can be used to facilitate recovery of the conventional oil and gas 

and CBNG resources prior to mining if the Federal coal in the tract is leased: 

x BLM will attach a Multiple Mineral Development stipulation in the Federal coal 

lease which states that BLM has the authority to withhold approval of coal mining 

operations that would interfere with the development of mineral leases that were 

issued prior to the Maysdorf II LBA North or South coal tract being leased 

(Appendix 2). The Cordero-Rojo Mine has obtained mine-over rights to the oil 

and gas leases included in this tract for any remaining oil and gas operations 

within the tract area. 

x Conventional oil and gas wells must be abandoned while mining and reclamation 

operations are in progress. If the value of the remaining oil and gas reserves 

justifies the expense of reestablishing production, the wells could be recompleted 

or redrilled following mining. 

x BLM has a policy in place regarding CBNG-coal development conflicts (BLM 

Washington Office Instruction Memorandum (IM) No. 2006-153). The IM directs 

BLM decision-makers to optimize the recovery of both CBNG and conventional 

oil and gas resources and to ensure that the public receives a reasonable return. 

This policy offers royalty incentives to CBNG operators to accelerate production 

in order to recover the natural gas while simultaneously allowing uninterrupted 

coal mining operations. In addition, the IM also states that it is the policy of the 

BLM to encourage oil and gas and coal companies to resolve conflicts between 

themselves and, when requested, BLM will assist in facilitating agreements 

between the companies. 

x Mining of the Maysdorf II LBA North and or South tracts would not be authorized 

until: 1) the coal lessee obtains a permit approved by the WDEQ/LQD to mine 

the tract, and 2) the MLA mining plan is approved by the Secretary of the Interior. 

Before the MLA mining plan can be approved, BLM must approve a Resource 

Recovery and Protection Plan (R2P2). Prior to approving the R2P2, BLM can 

review the status of CBNG and conventional oil and gas development on the 

tract and the mining sequence proposed by the coal lessee. Because the permit 

approval process generally takes the coal lessee several years to complete, 

CBNG resources on the coal tract could continue to be recovered during that 

time period. 

x Prior to mining the Federal coal, the coal lessee can negotiate an agreement with 

the oil, gas, and pipeline owners and operators regarding the removal of their 

existing facilities on the Maysdorf II LBA North and or South tracts. 

5
 
 

 

 

 

 

Any proposed coal-fired power plants that plan to initiate operation by 2020 currently 

would need to be undergoing air permit review in order to obtain the required 

construction permits and complete construction by 2020. 

The coal technology project by White Energy Coal North America which plans to use a 

Binderless Coal Briquetting technology in 2 plants, one near the Buckskin Mine and one 

near the Caballo mine is in the early planning stages with construction possible by 

2020. 

Methane production from in situ low temperature methanogenesis is being proposed in 

the PRB. Several companies have developed methods of increasing biogenetic 

methane within coal seams through enriched methanogenesis using the coal as a 

hydrogen source. This process uses the predominantly anaerobic microorganisms that 

metabolize the complex organic molecules in hydrocarbon deposits and produce 

methane gas as a waste product. The companies propose to transform uneconomic 

CBNG wells into economic production wells and use the existing infrastructure for their 

operations. None of the CBNG wells located within the Maysdorf II LBA North or South 

are planned for use in methanogenic methane operations and none of the wells 

proposed for this process will be impacted by operations at the Cordero-Rojo Mine 

during the life of either lease tract. Furthermore, the Cordero-Rojo Mine has mine-over 

rights to all CBNG wells on the Maysdorf II LBA North and South tracts. 

Coal plants, coal conversion projects, ongoing and proposed oil, gas, and CBNG 

operations are separate projects being developed independently of leasing the 

Maysdorf II LBA. If these other projects are developed as proposed and the Maysdorf II 

lease application area is leased and mined as proposed, there would potentially be 

some overlap between the environmental and economic impacts of constructing and 

operating some of those projects and the environmental and economic impacts of 

mining the Maysdorf II LBA tracts. The cumulative effects of these projects are 

described in chapter 4 of the South Gillette Area Coal Lease Applications EIS. The 

cumulative impact discussion in the EIS is based on the analyses done for the PRB 

Coal Review, which can be viewed on the BLM website at: 

http://www.blm.gov/wy/st/en/programs/energy/Coal_Resources/PRB_Coal/prbdocs.html 

DECISION 

As BLM Wyoming High Plains District Manager, my decision is that it is in the public 

interest to offer the Maysdorf II LBA North and South tracts as described below for 

competitive sale so that these reserves are available to compete for sale in the open 

coal market to meet the national coal demand that is expected to exist until at least 

2035. The public interest is served by leasing the Maysdorf II LBA North and South 

tracts because doing so provides a reliable, continuous supply of stable and affordable 

energy for consumers throughout the country. Developing this coal also helps reduce 

6
 
 

 

 

 

our nation’s dependence on foreign energy supplies and provides significant 

socioeconomic benefits for the United States, Wyoming, and local communities. 

Under this decision, Alternative 3 for the Maysdorf II LBA as described in Chapter 2 of 

the South Gillette Area Coal EIS has been selected. Under Alternative 3 the BLM has 

added part of the BLM study area to the tract as applied for, split the revised tract into 

two tracts (Maysdorf II LBA North and Maysdorf II LBA South), and removed the lands 

from consideration which have not received consent from the qualified surface owner. 

Two separate competitive sealed bid lease sales will be held. 

The tracts will be offered for lease at competitive sealed-bid sales. If the highest bid 

received at the sale meets or exceeds the FMV as determined by the BLM and if all 

other leasing requirements are met, a lease will be issued to the successful qualified 

high bidder. The competitive lease sale will be held as described in the Federal 

regulations found at 43 CFR Subpart 3422, Lease Sales. 

In the event that the highest bid submitted at the competitive lease sale of the Maysdorf 

II LBA North or South tracts does not meet or exceed the FMV as determined by BLM, 

the BLM may, but is not obligated to, re-offer the coal tract for leasing at a later date. 

This decision is in conformance with the Approved Resource Management Plan for 

Public Lands Administered by the BLM Buffalo Field Office (RMP), which was 

completed in 1985 with an RMP Plan Update in 2001 and an RMP Plan Amendment in 

2003. 

This decision incorporates by reference the standard coal lease stipulations which 

address compliance with the basic requirements of the environmental statutes and 

additional BLM special stipulations (Appendix 2). 

Under Alternative 3, it is assumed that the applicant would be the successful bidder on 

the Maysdorf II LBA tracts and that the Federal coal would be mined to extend the life of 

the adjacent Cordero-Rojo Mine. The tract would be mined and reclaimed in a logical 

sequence in concert with ongoing mining and reclamation operations at the adjacent 

existing mine. This would be consistent with the analysis of the impacts described in 

the EIS. 

REASONS FOR DECISION 

Denying this proposed coal leasing is not likely to affect current or future domestic coal 

consumption used for electric generation. Not offering the Maysdorf II LBA tracts is 

unlikely to affect changes in the national electric generation portfolio. The rationale for 

this conclusion is summarized below. 

7
 
 

 

 

Various commenters on the South Gillette Area Coal EIS asserted that by not leasing 

this LBA, and, in a cumulative sense, by denying proposed coal leasing in the Wyoming 

Powder River Basin (PRB), BLM would slow global climate change and would push the 

national electric generation portfolio to contain only non-carbon fuel alternatives. BLM 

has considered this comment/issue thoroughly in our decision. 

BLM agrees that movement toward electric generation capacity not reliant on carbon 

fuels is positive. Hydrocarbon fuels are a finite resource and will become more costly 

and rare. Having more non-hydrocarbon based (instead of hydrocarbon based) electric 

generation would assist in decreasing human-caused greenhouse gas (GHG) 

emissions. Reducing human-caused GHG emissions may help to lessen any harmful 

effects that they may be causing to the global climate system. 

BLM reviewed an independent study that determined the ability of the domestic electric 

generation industry to alter the present portfolio (mix of electric generation technologies) 

corresponding to the time period that the Maysdorf II LBA North and South reserves 

would be mined. The study was by the domestic electric generation industry's research 

arm, the Electric Power Research Institute (Electricity Technology in a Carbon 

Constrained Future, authored by R. James, Carnegie-Mellon University, November 

2007). 

The study projected the electric generation portfolio to 2030 (beyond the time both the 

Maysdorf II LBA North and South lease reserves would be produced) and recognized 

the possibility of carbon regulation. The study related the mix of renewable energy 

sources, nuclear, and hydrocarbon sources, and energy conservation, and found that 

coal-fired electric generation would represent 52-58 percent of the electric generation 

portfolio by 2030, as compared to the current approximately 51 percent. 

The Annual Energy Outlook 2012 Report (Energy Information Administration, June 

2012) represents a forecast to the year 2035. This most recent report forecast a 

lowered percentage of coal-fired electric generation in the domestic electric generation 

portfolio to 38% percent by 2035, 28% electric generation from natural gas by 2035, and 

15% from renewable energy sources, and 18% from nuclear energy sources. 

Based on these studies, even with a considerably more optimistic projection for 

renewable sources, coal use continues to be projected as the largest portion of the 

domestic electric fuel mix. The factors affecting change in the electric generation 

portfolio are time and cost of alternate technologies, infrastructure and increasing 

electric demand. BLM concludes that during the time that the proposed Federal coal 

lease reserves would be produced, the demand for coal-fired electric generation in the 

United States will still require coal be a major part of the U.S. energy portfolio. 

Further, BLM disagrees with the comment that denying the proposed Federal coal 

leasing application would reduce the rate of coal consumption by domestic electric 

generators. Numerous mines located outside of the Powder River Basin (PRB) are 

extracting and producing coal in the United States. In order to supply reliable power for 

8
 
 

 

the country’s electrical needs, many mines outside of the PRB have the capacity to 

replace the coal production generated by the Cordero-Rojo Mine. 

The Maysdorf II LBA North and South coal reserves, if leased and approved for mining, 

would allow the coal mining operator to continue to compete for coal sales in an open, 

diverse supply and demand market. PRB mines have been selling coal in this market 

for decades, and denying this lease offer would not cease currently approved mining 

operations. Rather, a denial would require the mine to stop operations only after the 

current lease reserves are depleted. This would deny the mine operator the ability to 

compete with other operators for a future coal demand that is expected to last until at 

least 2035. The inability of the Cordero-Rojo Mine, or any other existing PRB producer, 

to sell in the coal market will not cause electric generators to stop burning coal. Utility 

companies will operate existing coal-burning facilities until either cost or regulatory 

requirements make them ineffective, or until they are replaced by non-hydrocarbon 

electrical generation facilities. 

The effect of denying the Maysdorf II LBA North would be that the existing mine would 

cease operations after the current reserves are depleted, and the Cordero-Rojo Mine 

would not be competitive in the national coal market to meet the future coal demand in 

the U.S. that is expected to last until at least 2035. Other national coal producers have 

the capacity to produce coal and to replace the production from this existing mine. 

Lastly, PRB coal has competed for an increasing share of coal sales in the market, 

primarily because it is lower cost, environmentally compliant, and successful postmining reclamation has been thoroughly demonstrated. For these reasons, over the 

past several decades, PRB coal has been replacing other domestic coals in the open 

market, and would be expected to compete similarly in the future. 

Cumulatively, the effect of denying the leasing proposed throughout the PRB would be 

that many of the existing mines would cease operations once current reserves are 

depleted (ranging from 8 to 20 years). Those mines would then not be able to compete 

with other mines to meet the future coal demand that is expected to last until at least 

2035. When current reserves are depleted at these mines, their production would likely 

be replaced by other domestic and, potentially, international coal producers with coal 

that is more costly, less environmentally compliant, and has more residual 

environmental impacts. 

Many other factors, listed below, were considered in the decision to lease the Maysdorf 

II LBA: 

The BLM coal leasing program encourages the development of domestic coal 

reserves and the reduction of the United States’ dependence on foreign sources 

of energy. BLM recognizes that the extraction of coal is currently necessary in 

order to meet the nation’s energy needs, and a primary goal of the National 

Energy Policy is to add energy supplies from diverse sources including domestic 

oil, gas, and coal. Private development of Federal coal reserves is integral to the 

9
 

x
 

 

 

 

 

 

BLM coal leasing program under the authorities of the MLA of 1920, the Federal 

Land Policy and Management Act of 1976 (FLPMA) and the Federal Coal 

Leasing Amendments Act of 1976 (FCLAA). 

x	 The Cordero Mining Company submitted the application to lease the Federal coal 

in the Maysdorf II LBA in order to extend the life of the Cordero-Rojo Mine by 

allowing them to acquire access to a continuing supply of low sulfur compliant 

coal that will be sold to power plants for generating electricity. Continued leasing 

of low sulfur PRB coal assists coal-fired power plants to meet the CAA 

requirements for sulfur emissions. 

x	 The leasing and subsequent mining of Federal coal reserves provides the United 

States, the State of Wyoming, and its affected counties with income in the form of 

lease bonus payments, lease royalty payments, and tax payments. Production of 

Federal coal also provides the public with a supply of cost-efficient, low sulfur 

coal for power generation. The Wyoming Governor, the Wyoming legislature, 

and other state and local officials support Federal coal leasing. 

x	 The BLM is the lead agency responsible for leasing Federal coal lands under the 

MLA as amended. When an application to lease Federal coal is submitted, the 

BLM is obligated to respond to the application in a timely manner. In order to 

process an LBA, BLM must fulfill the requirements of NEPA by preparing 

environmental analyses. In this case, an EIS was prepared to provide the 

agency decision-makers and the public with a complete and objective evaluation 

of the environmental impacts of leasing and mining the Federal coal. BLM then 

makes a decision on whether or not to offer the Federal coal for lease. In either 

case, BLM must notify the applicant in a timely fashion of its decision. 

x	 Offering the Maysdorf II LBA tracts (totaling 3,644.27 acres more or less and 

containing approximately 382,115,000 million tons of mineable Federal coal 

reserves as estimated by the BLM) is responsive to the coal lease application 

received on September 1, 2006. 

x	 The decision to offer the Maysdorf II LBA North and South coal tracts for leasing 

is in conformance with the BLM land use plan decisions covering this area (see 

section entitled “Conformance with Existing Land Use Plans”). 

x	 The South Gillette Area Coal EIS was prepared in response to applications BLM 

received to lease tracts of Federal coal adjacent to existing mines in Wyoming. 

The environmental impacts of this decision were fully disclosed in the EIS. 

Public comment was addressed in the Final EIS. 

x	 The BLM’s preferred tract configuration under Alternative 3 provides for 

maximum economic recovery of the coal resource. Acreage from the original 

application has been removed due to the lack of qualified surface owner (QSO) 

consent. In order to ensure maximum economic recovery, the economic analysis 

10
 
 

 

 

of the bonus value for the LBA coal tracts along this QSO boundary includes a 

reasonable cost to acquire an over-strip agreement towards the end of mine life 

in order to mine the last of the LBA coal. 

x	 The U.S. Fish and Wildlife Service has provided written concurrence for leasing 

the Maysdorf II LBA North and South tracts pursuant to section 7(a)(2) of the 

Endangered Species Act of 1973, as amended (Appendix 3). Suitable habitats 

for Ute Ladies’-tresses were surveyed during the known flowering periods in 

2006 and 2007. One golden eagle/ferruginous hawk nest was identified outside 

the tract but still within the general analysis area. Twenty-three bird species on 

the “Coal Mine List of 40 Migratory Bird Species of Management Concern in 

Wyoming” have historically been observed in the South Gillette Area combined 

general analysis area at least once. Additional surveys and mitigation will be 

completed at the permitting for mining stage of the process for each individual 

LBA. 

x	 No Greater Sage-Grouse leks occur within the Maysdorf II LBA tracts as applied 

for, or within the Maysdorf II LBA North or South tracts as delineated with lands 

added under Alternative 3. Two Greater Sage-Grouse leks have been found 

within the Maysdorf II LBA wildlife general analysis area outside the delineated 

tract configurations. Seven other Greater Sage-Grouse leks have been 

documented within 2 miles of the Maysdorf II wildlife general analysis area. The 

Belle Ayr 1, Cordero Mine, and Thrush leks have been classified as occupied. 

The Doud and Belle Fourche South leks are classified as unoccupied/abandoned 

and the Stowe, Belle Ayr II, Hoadley Road and Coal Creek II leks are classified 

as unoccupied/destroyed. Occupied leks are protected through prescribed 

management actions during surface disturbing activities. Additional surveys and 

mitigation will be completed at the permitting for mining stage of the process for 

the Maysdorf II LBA North and South tracts. 

x	 There are 49 previously recorded sites within the APE (defined as the lease area 

and a 1⁄4 mile buffer surrounding the lease area), 43 of which have been 

determined not eligible by the BLM with SHPO concurrence (48CA94, 48CA877, 

48CA880, 48CA882, 48CA1436, 48CA1437, 48CA1568, 48CA1879, 48CA1880, 

48CA1881, 48CA1883, 48CA1884, 48CA1886, 48CA1888, 48CA1893, 

48CA1894, 48CA1895, 48CA1900, 48CA3177, 48CA3342, 48CA4124, 

48CA5601, 48CA5625, 48CA5626, 48CA5627, 48CA5628, 48CA5635, 

48CA5685, 48CA5687, 48CA5689, 48CA5690, 48CA5716, 48CA5724, 

48CA5727, 48CA5736, 48CA5738, 48CA5740, 48CA5798, 48CA6816, 

48CA6817, 48CA6819, 48CA6821 and 48CA6822). Ten of these sites (in bold 

text in the above list) have already been destroyed by permitted mining activity. 

It is anticipated that all 43 of the existing not eligible sites will be destroyed by 

11
 
 

 

 

 

strip mining activities. 

The assumed location of the eligible Deadwood Road (48CA1568, segment 17) 

is in the APE, but no definite traces of the trail were discovered during a Class III 

cultural resource inventory and the segment is considered to be non-contributing 

with lease issuance resulting in a BLM determination of “no adverse effect”. 

Sites 48CA5717 and 48CA5723 (prehistoric sites with buried components) are 

eligible under criterion “d” and are within the APE for the Maysdorf II lease. After 

tribal consultation with representatives from the Fort Peck, Northern Arapaho, 

Cheyenne River Sioux, Rosebud Sioux, Sisseton Wahpeton Oyate, and Yankton 

Sioux tribes, BLM determined that sites 48CA5735 and 48CA5737 (sites 

containing multiple stone features) are eligible under criterion “a” and that they 

have religious and cultural significance to all the aforementioned tribes. Both 

sites are within the APE for the Maysdorf II lease. BLM determined that issuance 

of the lease will result in an “adverse effect” to sites 48CA5717, 48CA5723, 

48CA5735 and 48CA5737. BLM will include a stipulation in the lease prohibiting 

surface disturbance on each site until mitigation is determined by WDEQ and 

OSM in consultation with the Wyoming SHPO and interested tribes. 

The Bureau has determined that the proposed Maysdorf II coal lease will result in 

an “adverse effect” to 48CA1439, 48CA1442, 48CA5717, 48CA5723, 48CA5798, 

48CA5735 and 48CA5737. Lease issuance will result in “no adverse effect” to 

site 48CA1568. No other historic properties will be affected by the project. 

According to the Wyoming State Protocol Section VI (B)(1) the Bureau of Land 

Management requested concurrence of the Wyoming SHPO on 8/6/12. BLM 

received concurrence on these determinations from SHPO on 8/22/12. 

x	 Issuing a Federal coal lease for the Maysdorf II LBA North and or South tracts 

would not result in the creation of new sources of human-caused GHG or 

mercury emissions. The Cordero-Rojo Mine would produce the Maysdorf II LBA 

coal at currently permitted levels using existing production and transportation 

facilities. If the Maysdorf II LBA tracts are leased and mined, site-specific GHG 

emission rates from the Cordero-Rojo Mine are anticipated to increase slightly 

compared to current emission rates due to increased strip ratios and added 

hauling distances. 

x	 If the Maysdorf II LBA Federal coal is leased and mined at the currently permitted 

levels and is used to generate electricity by coal-fired power plants, the 

emissions of GHG and mercury attributable to the coal produced from the 

Cordero-Rojo Mine would be extended for approximately 2.6 additional years. 

The rate of anthropomorphic CO2 and mercury emissions would depend upon 

the permitted levels at the coal combustion facilities where the coal is burned and 

the potential emission limits that may be applied to those facilities in the future by 

regulation or legislation. 

x	 The regulation of GHG emissions as an air pollutant is recognized in this 

12
 
 

 

 

 

 

 

decision. An effect on coal production and use may develop, depending on how 

the regulatory actions affect the demand for coal and the mix of methods used to 

produce electricity in the U.S.. Effects to coal demand are reflected through the 

coal market, coal pricing, and supply. If demand decreases, it is expected that 

less efficient coal producers, or those with reserves having less desired coal 

characteristics, may lose customers. 

PUBLIC INVOLVEMENT 

BLM received the Maysdorf II coal lease application on September 1, 2006. The 

Maysdorf II coal lease application was announced to the public on March 29, 2007. The 

Powder River Regional Coal Team (PRRCT) was notified that Cordero Mining Company 

had filed an application for the Maysdorf II coal lease and presented with the Maysdorf II 

LBA for review on January 18, 2007. At the January 18, 2007 public meeting, the 

PRRCT reviewed the Maysdorf II coal lease application. Cordero Mining Company 

presented information about their existing mine, the history of the Maysdorf II LBA, and 

the current pending Maysdorf I lease application to the PRRCT at that meeting. The 

PRRCT recommended that the BLM process the application. On September 18, 2006, 

BLM notified the Governor of Wyoming of the recommendation. BLM published a 

Notice of Intent to Prepare an Environmental Impact Statement and Notice of Public 

Meeting in the Federal Register on March 29, 2007. Scoping notices were mailed to 

Federal, state, and local government agencies, conservation groups, commodity 

groups, and individuals who could be impacted by this LBA. BLM and the applicant 

jointly developed the distribution list. BLM published public scoping meeting notices in 

the local newspapers. On April 11, 2007, a public scoping meeting was held in Gillette, 

Wyoming. The scoping period extended from March 29, 2007 to June 1, 2007, during 

which time BLM received written, e-mailed, and telephoned comments from six entities. 

A notice announcing the availability of the South Gillette Area Coal Lease Applications 

Draft EIS was published in the Federal Register by the EPA on October 24, 2008. 

Parties on the distribution list were sent copies of the Draft EIS at that time and the Draft 

EIS became available on the Wyoming BLM webpage. A 60-day comment period on 

the Draft EIS commenced with publication of the EPA’s Notice of Availability and ended 

on December 24, 2008. The BLM published a Notice of Availability/Notice of Public 

Hearing in the Federal Register on October 17, 2008. The BLM’s Federal Register 

Notice of Public Hearing announced the date and time of the formal public hearing, 

which was held on November 19, 2008, in Gillette, Wyoming. The purpose of the public 

hearing was to solicit public comment on the Draft EIS, fair market value, maximum 

economic recovery, and the proposed competitive sale of Federal coal from the LBA 

tract. One individual presented statements on the draft EIS during the hearing and 

written comments were received from 18 individuals, agencies, or organizations during 

the comment period. 

A notice announcing the availability of the South Gillette Area Coal Lease Applications 

Final EIS was published in the Federal Register by the EPA on August 17, 2009; parties 

13
 
 

 

 

 

 

on the distribution list were sent copies of the Final EIS at that time. The comment 

period for the Final EIS ended on September 16, 2009. The review period was open for 

30 days after the EPA’s Notice of Availability published in the Federal Register. 

Comments that BLM received on the Draft EIS and how BLM considered these 

comments during the preparation of the Final EIS were included in Appendix I of the 

Final EIS. BLM received eight comment letters regarding the Final EIS. Of the 8 

letters, 6 letters were individual and 2 were form letters. Of the form letters, Form Letter 

1 was received from 423 individuals and Form Letter 2 was received from 14,427 

individuals. Within Form Letter 1, 4 individuals modified their letter to include additional 

comments. Within Form Letter 2, 665 individuals modified their letter to include 

additional comments. The 6 individual letters were from: Dorsey and Whitney LLP, 

Crook County Land Use Planning and Zoning Commission, WildEarth Guardians, Clean 

Energy Action, Rio Tinto Energy America, and Powder River Basin Resource 

Council/Center for Biological Diversity. The issues of greatest concern were: Power 

plant greenhouse gas emissions from Powder River Basin coal combustion, Powder 

River Basin air quality, wanting greater emphasis on renewable energy development 

from the BLM, concern about the success of the mining reclamation process, concern 

about water resources in the Powder River Basin, and concern for adequate protection 

of plant and animal species. Comments that BLM received on the Final EIS have been 

reviewed and evaluated, and comment letters and a consolidated BLM response are 

available at 

http://www.blm.gov/pgdata/content/wy/en/info/NEPA/HighPlains/SouthGillette.html. 

Written comments and the transcript of the formal hearing are also on the South Gillette 

Area Coal EIS webpage. All comments that were received were considered in the 

preparation of the Final EIS and in this Record of Decision. 

SUMMARY OF THE PROPOSED ACTION AND ALTERNATIVES 

The EIS analyzed the proposed action and two alternatives in detail for the Maysdorf II 

LBA. Chapter 2 of the EIS contains a full description of each. Summarized descriptions 

are presented below. 

Proposed Action: Hold a competitive sale for the Federal coal lands as applied 

for and issue a maintenance lease to the successful bidder. 

Under the Proposed Action, the lands applied for in the Maysdorf II application by the 

Cordero Mining Company would have been offered for lease at a competitive sealed-bid 

sale. As applied for, the tract included approximately 4653.8 acres. The applicant 

estimated that the lands contained approximately 504 million tons of mineable Federal 

coal. This alternative assumed that the applicant would be the successful bidder and 

14
 
 

 

 

 

that the coal would be mined, processed, and sold by the Cordero-Rojo Mine. 

Alternative 1: The No Action Alternative 

Under Alternative 1 the Cordero Mining Company application to lease the coal included 

in the Maysdorf II LBA tract would be rejected. The tract would not be offered for 

competitive sale at this time, and the coal included in the tract would not be mined. 

Under this alternative, the Cordero-Rojo Mine would mine its remaining 571.5 million 

tons of recoverable coal reserves on the existing Cordero-Rojo mine leases in 

approximately 11.4 years at an average production rate of approximately 46.3 mmtpy 

(million tons per year). 

Rejection of the application would not affect permitted mining activities or employment 

at the Cordero-Rojo Mine during the remaining life of the mine. 

Alternative 2: Reconfigure the tract and hold one competitive sale for Federal 

coal lands in the tract as modified by BLM and issue a lease to the successful 

bidder. 

Along with the Federal coal lands that were applied for by the Cordero-Rojo Coal 

Company, BLM identified and analyzed an additional 4895.6 acres of unleased Federal 

coal adjacent to the southwestern edge of the application land. These additional lands 

and the as-applied-for tract were referred to as the BLM study area. The study area 

enabled BLM to evaluate and explore the potential of increasing competitive interest in 

the tract, allowing for more efficient recovery of Federal coal in the area, and reducing 

the likelihood of bypassed Federal coal. 

Alternative 3 (Selected Alternative): Reconfigure the tract and hold two 

competitive sales for Federal coal lands in the tract as modified by BLM and issue 

leases to the successful bidders. 

Under Alternative 3 for the Maysdorf II LBA tract, BLM considered adding all or part of 

the BLM study area to the tract as applied for and dividing the revised tract into two 

tracts and offering one or both of those tracts for sale. Under this alternative, BLM 

could add all, part, or none of the adjacent lands to the tract or reduce the size of the 

tract. A separate, competitive sealed bid sale would be held for each tract that is 

offered for sale. Each tract would be subject to standard and special lease stipulations 

developed for the PRB and for that tract. 

Along with the Federal coal lands that were applied for by the Cordero-Rojo Coal 

Company, BLM identified and analyzed an additional 241.80 acres of unleased Federal 

coal adjacent to the application land. These additional lands and the as-applied-for tract 

were referred to as the BLM study area. The study area enabled BLM to evaluate and 

explore the potential of increasing competitive interest in the tract, allowing for more 

efficient recovery of Federal coal in the area, and reducing the likelihood of bypassed 

15
 
 

 

 

Federal coal. 

Under the selected configuration, the Maysdorf II LBA modified North and South tracts 

include approximately 3,644.27 acres and BLM estimates that they contain 438 million 

tons of in place coal (382,115,000 million tons of mineable coal). As delineated the 

Maysdorf II LBA North tract contains approximately 1,338.37 acres and 167 million tons 

of in place coal (148,565,000 minable tons of coal); the Maysdorf II LBA South tract 

contains approximately 2,305.90 acres and 271 million tons of in place coal 

(233,550,000 minable tons of coal). 

The legal descriptions of the lands to be offered for competitive sale under Alternative 3, 

BLM’s selected tract configuration, for the Maysdorf II LBA tracts are: 

Maysdorf II LBA North Tract 

T. 47 N., R. 71 W., 6th P.M., Wyoming 

Sec. 7: Lots 6-11, 14-19; 490.180 acres 

T. 47 N., R. 72 W., 6th P.M., Wyoming 

Sec. 1: Lots 9-13, NW1⁄4SE1⁄4; 241.80 acres 

Sec. 12: Lots 1-12, 14-16; 606.39 acres 

Containing 1,338.37 acres, more or less. 

Maysdorf II LBA South Tract 

T. 46 N., R. 71 W., 6th P.M., Wyoming 

Sec. 4: Lots 8, 9, 16, 17; 163.79 acres 

Sec. 5: Lots 5, 12, 13, 20; 165.03 acres 

Sec. 9: Lots 6-8; 122.86 acres 

Sec. 10: Lots 7-10; 162.62 acres 

Sec. 11: Lots 13-16; 161.87 acres 

16
 
 

 

 

 

 

 

 

Sec. 14: Lots 1-4; 161.69 acres 

Sec. 15: Lots 1-4; 162.59 acres 

T. 47 N., R. 71 W., 6th P.M., Wyoming 

Sec. 17: Lots 1-15, SW1⁄4NW1⁄4; 639.73 acres 

Sec. 18: Lots 5, 6, 11, 12; 160.08 acres 

Sec. 20: Lot 1; 37.93 acres 

Sec. 21: Lot 4; 40.13 acres 

Sec. 32: Lots 1, 8, 9, 16; 162.94 acres 

Sec. 33: Lots 4, 5, 12, 13. 164.64 acres 

Containing 2,305.90 acres, more or less. 

The land descriptions and acreage are based on the BLM Status of Public Domain Land 

and Mineral Titles Approved Master Title Plat as of November 17, 2011. The coal 

estate in the tracts described above is Federally owned. Surface ownership consists of 

private lands owned by subsidiaries of Cloud Peak Energy and Federal lands 

administered by the BLM. 

ALTERNATIVES CONSIDERED BUT NOT ANALYZED IN DETAIL 

Further descriptions of these alternatives may be found in Chapter 2 of the Final EIS. 

Alternative 4 

Under this alternative, as under the Proposed Action and Alternative 2, BLM would hold 

a competitive coal lease sale and issue a lease for the lands included in the Maysdorf II 

LBA tract. Alternative 4 assumes, however, that the successful qualified bidder would 

be someone other than the applicant and that this bidder would plan to open a new 

mine to develop the Federal coal resources. In BLM’s current estimation, in order for a 

new mine to open in the Wyoming PRB the first lease would need to contain 

approximately 500 to 600 million tons of coal. 

This alternative was considered but was not analyzed in detail because it was unlikely 

that a new mine would start up by the lease of this tract. The total amount of coal 

included in the tract is not sufficient to consider opening a new mine. Also, a new mine 

17
 
 

 

 

 

 

 

would create a new source of air quality impacts. The potential difficulty in obtaining an 

air quality permit is another issue that could discourage new mine starts in the PRB. 

Alternative 5 

Under Alternative 5, the BLM would have delayed the sale of the Maysdorf II LBA tract 

as applied for. Delaying the sale may have allowed CBNG resources to be more 

completely recovered prior to mining. If the coal market prices increased in the future, 

bonus and royalty payments to the government would have been higher if the tract was 

offered for sale at a later date. 

This alternative was not analyzed in detail because it would not produce substantially 

different impacts than other alternatives that were analyzed in detail. First, rental and 

royalty provisions in the proposed lease provide for the U.S. to benefit if coal prices 

increase by the time of mining. Royalty and tax payments are collected at the time the 

coal is sold. They increase as coal prices increase, which allows the United States to 

benefit if coal prices have increased by the time of mining. Second, as described in 

Chapter 2 of the EIS, several mechanisms are already in place to facilitate continued 

CBNG recovery prior to mining the Maysdorf II LBA. 

CONFORMANCE WITH EXISTING LAND USE PLANS 

Under the requirements of FCLAA, lands that are being considered for Federal coal 

leasing must be included in a comprehensive land use plan and leasing decisions must 

be compatible with that plan. The Approved Resource Management Plan for Public 

Lands Administered by the BLM Buffalo Field Office (RMP), which was completed in 

1985 with an RMP Plan Update in 2001 and an RMP Plan Amendment in 2003, governs 

and addresses the leasing of Federal coal in Campbell County. 

The major land use planning decision that BLM must make concerning Federal coal 

resources is a determination of which Federal coal lands are acceptable for further 

consideration for leasing. There are four coal screening procedures that BLM uses to 

identify these coal lands. The screening procedures require BLM to: 1) estimate 

development potential of the coal lands, 2) apply the unsuitability criteria listed in the 

regulations at 43 CFR 3461, 3) make multiple land use decisions that eliminate Federal 

coal deposits from consideration for leasing to protect other resource values, and 4) 

consult with surface owners who meet the criteria defined in the regulations at 43 CFR 

3400.0-5 (gg) (1) and (2). The coal screens were developed for Federal decisionmaking and are utilized in environmental analyses associated with BLM RMPs, EISs, 

and other evaluations, and resource management activities. 

Under the first coal screening procedure, a coal tract must be located within an area 

that has been determined to have coal development potential in order to receive further 

18
 
 

 

 

 

 

 

consideration for leasing [43 CFR 3420.1-4(e)(1)]. The Maysdorf II coal lease 

application is within the area identified by BLM as having coal development potential. 

The second coal screening procedure requires the application of the coal mining 

unsuitability criteria which are listed in the Federal coal management regulations at 43 

CFR 3461. These criteria have been applied to high to moderate coal development 

potential lands in the Wyoming PRB, including the Maysdorf II LBA tracts and 

surrounding lands. 

Unsuitability Criterion Number 3 states that lands within 100 feet of the outside line of 

the ROW of a public road shall be considered unsuitable for surface coal mining. The 

area where Highlight Road crosses BLM’s Maysdorf II LBA tract as applied for and 

study area has been removed from leasing. As there are no other roads within the area 

covered by the Maysdorf II LBA and study area, Unsuitability Criterion Number 3 is no 

longer applicable to the Maysdorf II LBA. 

No other lands included in the Maysdorf II LBA tracts were found to be unsuitable for 

mining during the application of the unsuitability criteria for BLM’s 2001 Buffalo RMP 

update. Site-specific unsuitability determinations for some criteria were deferred until 

an application to lease was filed. These findings are included in Appendix B of the 

South Gillette Area Coal Final EIS. 

The third coal screening procedure, a multiple land use conflict analysis, must be 

completed to identify and “eliminate additional coal deposits from further consideration 

for leasing to protect resource values of a locally important or unique nature not 

included in the unsuitability criteria,” in accordance with 43 CFR 3420.1-4(e)(3). The 

2001 Buffalo RMP update addresses two types of multiple land use conflicts: 

municipal/residential conflicts and multiple mineral development (coal versus oil and 

gas) conflicts. 

The municipal/residential multiple land use conflict was addressed by applying buffers 

around the municipal planning boundaries for the major municipalities within the BLM 

Buffalo Field Office area, including Gillette and Wright. BLM’s selected Maysdorf II LBA 

North and South tract configurations do not extend into any of the municipal buffer 

zones. 

BLM’s evaluation of the multiple mineral development conflicts related to issuing leases 

for the Maysdorf II lands is discussed above in the “Pending Coal Leasing Applications 

and Other Proposed Projects in the Wyoming Powder River Basin” section of this record 

of decision. The Cordero-Rojo Mine has obtained mine-over rights for all oil and gas 

installations within the tract and study area. 

The fourth coal screening procedure requires consultation with surface owners who 

meet the criteria defined in the regulations at 43 CFR 3400.0-5 (gg) (1) and (2). Under 

BLM’s selected alternative, surface ownership consists of privately owned lands. If 

private surface owners are determined to be qualified under this CFR, then qualified 

19
 
 

 

 

 

surface owner consent is required before those lands can be included in a Federal coal 

lease. The Norma L. Duvall and Kenneth R. Duvall Trusts are qualified surface owners. 

The land surface owned by the Norma L. Duvall and Kenneth R. Duvall Trusts has not 

received surface owner consent for leasing at this time and has been removed from 

consideration for leasing under the Maysdorf II coal lease application. Parts of T47N 

R71W Sections 20, 21, and 28, and T47N R72W Sections 12 and 13 were removed 

from consideration for leasing under the Maysdorf II LBA. Subsidiaries of Cloud Peak 

Energy and Federal lands administered by the BLM are the remaining surface owners in 

the configured North and South tracts. 

In summary, the lands in the Maysdorf II LBA tracts have been subjected to the four 

coal leasing screens and are determined to be acceptable for further consideration for 

leasing. Thus, a decision to lease the Maysdorf II LBA Federal coal is in conformance 

with the current BLM Buffalo RMP. 

MITIGATION, COMPLIANCE, AND MONITORING 

If the Maysdorf II LBA North or South tract is leased, the lease will contain standard coal 

lease stipulations and also BLM Special Stipulations. BLM has applied special 

stipulations (Appendix 2) to avoid environmental damage or mitigate potential conflicts 

affiliated with cultural resources, paleontological resources, threatened and endangered 

species, multiple mineral development of oil and/or gas and coal resources, resource 

recovery and protection, and/or public land survey. No additional special stipulations 

were identified in Appendix D of the Final EIS. The final special stipulations are 

attached to this decision and will become part of the Federal coal lease records and 

pertain to all lands described in the Federal coal lease tract. 

After Federal coal leases are issued, SMCRA gives the OSM authority to administer 

programs that regulate surface coal mining operations. The WDEQ regulates surface 

coal mining activities in Wyoming. If the Cordero Mining Company is the successful, 

qualified high bidder for the Federal coal included in the Maysdorf II LBA North and 

South tracts, a permit revision must then be approved by the WDEQ/LQD. An MLA 

mining plan revision must also be approved by the Assistant Secretary of the Interior 

before the coal in the tracts can be mined. The existing mitigation measures specific to 

the currently approved mine plan for the adjacent mine would then be revised to include 

the new mitigation measures specific to the Maysdorf II LBA tracts. The mining permit 

would be amended to include the new mitigation requirements. 

If the successful bidder(s) on the Maysdorf II LBA North or South coal lease sale does 

not currently operate a mine that is adjacent to the Maysdorf II LBA North or South tract 

(WYW173360 or WYW180711 respectively), then the bidder would likely propose to 

construct a new mine in order to recover these Federal coal reserves. Because this 

would be a new mine start, the proponent would then submit a new permit application 

package to WDEQ/LQD for approval. A new MLA mining plan would also need to be 

submitted and approved by the Assistant Secretary of the Interior before the tract could 

20
 
 

be mined. The approved permit(s) would include mitigation measures and monitoring 

plans specific to mining the newly leased tract. 

Prior to mining a coal lease area, the lease must be permitted for mining by OSM and 

WDEQ. If a lease is permitted for mining, additional conditions and stipulations may be 

assigned by OSM and WDEQ. Please see Section 1.3 of the Final EIS for additional 

information regarding regulatory authority and responsibility in relation to coal mining in 

Wyoming. 

To ensure that the revised plan is in compliance with the leasing stipulations, BLM has a 

responsibility to review the R2P2 prior to approval of the mining plan. Before any 

mining operations can begin on the Maysdorf II LBA tracts, R2P2s applicable to the 

tracts must be approved by the BLM, a permit or permit revision must be approved by 

WDEQ/LQD, and an MLA mining plan or plan revision must be approved by the 

Assistant Secretary of the Interior. 

21
 


24

MAYSDORF II ROD
 

APPENDIX 1
 

Figures
 
Figure 1. General Location Map with Federal Coal Leases and LBA Tracts 

25
 
Figure 2. Maysdorf II LBA Tracts
 

26
 
Figure 3. Maysdorf II LBA North and South Tracts
 

27
 
28

MAYSDORF II ROD
 

APPENDIX 2
 

BUREAU OF LAND MANAGEMENT
 

SPECIAL COAL LEASE STIPULATIONS
 

AND COAL LEASE FORM 3400-12
 
 

 

 

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 NRHP eligibility 

determinations made, and consultation with the State Historic Preservation Officer completed 

before any surface disturbing activities take place. 

(3) No surface disturbance will occur near eligible sites 48CA5717, 48CA5723, 48CA5735 and 

48CA5737 until consultation with the Wyoming SHPO office has occurred and an appropriate 

mitigation plan implemented. The BLM has determined that leasing the coal will result in an 

adverse effect to sites 48CA5717, 48CA5723, 48CA5735 and 48CA5737. Consultation in 

relation to the resolution of the adverse effect will be completed by the OSM and WDEQ during 

the mine permitting process, prior to any surface disturbance. 

29
 
 

 

 

 

(4) 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 unless 

modified by mutual agreement in consultation with the State Historic Preservation Officer. 

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

measures shall be borne by the lessee. 

(6) 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. 

(7) 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 

30
 
 

 

 

 

and management objectives or to avoid activity that will contribute to a need to list such 

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. 

(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 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 (as defined at 43 CFR 3480.0­

5(21)) of the recoverable coal reserves or (ii) the operator/lessee is determined to have caused 

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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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MAYSDORF II ROD
 

APPENDIX 3
 

CONCURRENCE LETTER FROM THE 

U.S. FISH AND WILDLIFE SERVICE 
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MAYSDORF II ROD
 

APPENDIX 4
 

APPEAL PROCEDURES 
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