Coal exports raise questions about royalties
BILLINGS, Mont. — Lawmakers asked the Department of Interior on Friday to review whether companies are shortchanging federal and state governments out of millions of dollars in royalties on coal exported to foreign markets.
The request from Oregon Sen. Ron Wyden and Alaska Sen. Lisa Murkowski was made as coal exports hit record levels last year — an estimated 124 million tons, according to projections from the Department of Energy.
That includes increasing quantities of steam coal used in power plants, which is being shipped to Asia from the Powder River Basin of Montana and Wyoming by companies including Arch Coal Inc., Peabody Energy Corp. and Cloud Peak Energy Inc.
The senators want to know whether companies violated federal leasing law by paying royalties based on the coal's mine price, then selling it overseas at a higher price through affiliated brokers.
Interior officials said last week they are looking into the issue. Montana Gov. Brian Schweitzer said he has seen no evidence that companies are dodging what they owe.
“If somebody's pulling some shenanigans, we want to get to the bottom of it, but I don't think they are,” the Democratic governor said Friday in an interview with The Associated Press. “I haven't seen any evidence that they are shortchanging us at all.”
Wyden is the incoming Democratic chairman of the Senate Energy and Natural Resources Committee, and Murkowski is the panel's ranking Republican. They said the rise in export volumes makes it crucial that proper royalties are collected on coal mined from federal land.
“Taxpayers must be confident that (the Interior Department has) stringent royalty collection and auditing controls in place as coal markets become increasingly oriented toward international buyers,” they wrote in a letter to Interior Secretary Ken Salazar. “If the department's regulations are inadequate to ensure that full royalty value is returned, those regulations must be reformed.”
The senators asked Salazar to respond by Feb. 4.
Representatives of Peabody and Cloud Peak said the companies were fully compliant with federal royalty rules. A spokeswoman for Arch declined comment.
Powder River Basin coal is sold domestically for about $10 a ton. That compares with prices in countries such as Japan that can top $100 per ton.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Cleveland protests of officer’s acquittal mostly peaceful
- Flash floods in Texas, Oklahoma kill 2; hundreds of homes gone
- After bruising safety crisis, U.S. car watchdog shows its bite
- John Nash, wife, ‘A Beautiful Mind’ inspiration, die in N.J. taxi crash
- Senator Warren calls for public hearings on bank waivers
- Coal’s worst fears affirmed in analysis of Obama climate plan
- Veterans frustrated by GOP presidential debate on Iraq War
- Arizona to limit welfare to 12 months
- Senators push for full funding for Amtrak
- Michigan woman marks 116th birthday
- Prostitute pleads guilty in overdose death of Google exec