By Kennedy Maize
The Trump administration’s latest attempt to sell federal “clean, beautiful coal,” has again failed to find a buyer, this time in Utah. It’s the third Interior Department western coal lease flop this month. Other October Bureau of Land Management coal sales collapsed in Montana and Wyoming.
Interior’s Bureau of Reclamation announced last week (Oct. 16) that it had rejected the only bid it received for sale of two tracts of coal totaling some 6 million tons in the Manti-La Sal National Forest near central Utah’s Skyline mine. The agency did not reveal the price bid for the coal, saying only that it didn’t meet the requirements of the Mineral Leasing Act.
BLM also did not identify the bidder, although it most likely was Wolverine Fuels LLC of Sandy, Utah, the owner of the existing mine and coal leases. Wolverine originally called for the sale.
Skyline is an underground mine using longwall and conventional continuous mining equipment, producing some 3-4 million annual tons of high-Btu, low-sulfur coal. It is the largest of Wolverine’s two operating underground mines. A third mine is idled and another under development and planned for operations in 2026. The company also operates a coal preparation plant and a coal storage site.
The company says it supplies coal “to a large network of domestic utility and industrial users, in addition to substantial exports to East Asian markets.” A map on the company website indicates its operations are close to Union Pacific rail lines and in the vicinity of two PacifiCorp coal-fired power plants and the state-owned Intermountain Power Agency, housing a 1,900-MW coal-fired generator.
As October dawned, Interior Secretary Doug Burgum (or, more likely, a ghost writer) said BLM “is making up to 13.1 million acres of federal coal available for lease, lowering royalty rates to strengthen competitiveness, and streamlining approvals for projects in Montana, Wyoming, Tennessee and beyond. These actions follow passage of the One Big Beautiful Bill Act, which directs the Department to make additional acres of coal available for development and provide regulatory certainty for producers.”
Days later, Reuters reported, “The Trump administration has postponed a scheduled sale of coal leases on federal lands in Wyoming two days after a failed auction in Montana.”
Interior offered 167 million tons of coal in Montana’s Powder River Basin. The offered coal was adjacent to the Spring Creek Mine, owned by the Navajo Transitional Energy Company (NTEC), which was the only bidder. The tribal-owned company offered $186,000 for the coal, or a tenth of a penny per ton. Interior rejected the bid.
After the Utah flop, Interior quietly postponed a scheduled sale of 365 million tons of coal on 3,500 acres in Douglas and Converse counties in Wyoming ‘s Powder River Basin. According to Reuters, BLM said it would schedule a new date for the Wyoming sale “but did not give a reason for the postponement.”
Predictably and with a straight face, Interior blamed Democrats for the failure of its Montana lease sale. “While we would have liked to see stronger participation, this sale reflects the lingering impact from Obama and Biden’s decades long war on coal which aggressively sought to end all domestic coal production and erode confidence in the U.S. coal industry,” the agency said in an email to WyoFile.
Trump’s DOI has managed to pull off one coal lease sale, in Alabama, which it has touted on its web site although it is silent on its western leasing failures. On Sept. 30, Interior announced a successful coal lease sale of “over $46 million in revenue and will give access to 53 million tons of metallurgical coal on 14,050 acres of federal mineral estate.” The sole bidder was Warrior Met Coal Mining, LLC , (NYSE:HCC) a major regional met coal provider.
Warrior paid $46 million for 53 million tons of premium met coal, or $.87 ton.
Interior bragged, “This lease sale is another example of how the Department of the Interior is delivering on President Trump’s commitment to unleash American energy, strengthen rural economies and secure fair returns for the American people. By expanding access to America’s world-class metallurgical coal reserves, we are creating good-paying jobs, supporting domestic steel production, and reinforcing our nation’s Energy Dominance.”
Among the steps the Trump administration has taken to burnish coal is to reduce royalties producers pay on mined federal coal, from 12.5% on surface-mined coal to 7%. Trump’s omnibus “Big Bill” also reduced oil and gas royalties from 16.6% to 12.5%. States get half of the royalty payments.
The reductions have caused discomfort for states that have historically received large payments from Interior’s leases. Chief among them is Wyoming. The state watchdog group Taxpayers for Common Sense calculated that the oil and gas royalty reductions will cost the Cowboy State $11 million annually and the coal royalty reduction will cost $50 million a year. That’s sparked concern in the legislature, including among the influential and very conservative Wyoming Freedom Caucus, which controls the legislature’s House.
Taxpayers for Common Sense said, “Competitive, market-rate royalty rates do not affect industry interest or production decisions — lowering rates only shortchanges taxpayers by reducing future royalty revenue.”