Cloud Peak Energy, the third-largest U.S. coal producer and the only pure-play Powder River Basin (PRB) coal company, today announced its successful bid for the West Antelope II North Coal Tract, which was previously nominated by the company’s Antelope mine.
The Bureau of Land Management (BLM) estimates this tract contains approximately 350 million tons of mineable coal. At year-end 2010, the company’s Antelope mine had an estimated 252 million tons of coal reserves, and Cloud Peak Energy had an estimated total reserve of 970 million tons of coal.
Cloud Peak Energy successfully won the lease sale with a bid of approximately $297.7 million, or approximately $0.85 per ton, based on the BLM’s estimate of 350 million mineable tons.
The company submitted a payment for approximately $59.5 million, which is the first of five equal payments for the federal coal lease. The BLM typically awards the lease within several months after selecting a winning bidder. As previously disclosed, the West Antelope II Lease by Application (LBA) is subject to pending legal challenges filed by certain environmental organizations against the BLM and the Secretary of the Interior.
The issuance of the coal lease for this tract will facilitate access to an additional 80 million tons of non-reserve coal deposits controlled by the Antelope mine. This additional coal is controlled through a lease with the State of Wyoming.
“We’re very pleased with our acquisition of the West Antelope II North Coal Tract. This tract is expected to more than double the reserves at the Antelope mine and, along with the additional coal within the State of Wyoming lease, add about twelve years of production,” said Colin Marshall, President and Chief Executive Officer.
The BLM also recently announced a June 15, 2011 sale date for the West Antelope II South Coal Tract, which contains approximately 56 million mineable tons, according to BLM estimates.
Cloud Peak Energy has more than 1,500 employees and is a sustainable fuel supplier for approximately 4 percent of U.S. electricity.
Read the full press release here
Image supplied by Cloud Peak Energy
