FARMINGTON – The Navajo Transitional Energy Co. became the third largest coal producer in the country this week after finalizing the acquisition of three mines in Wyoming and Montana.
The company, owned by the Navajo Nation, bought the mines from Cloud Peak Energy after it filed bankruptcy earlier this year.
The two mines in Wyoming, the Antelope and the Cordero Rojo, are the third- and fifth- largest coal mines in the country, significantly increasing the coal production of NTEC. While the newly acquired mines primarily provide energy to electric utilities in the Midwest and western and southeastern United States, NTEC also announced Thursday the company was looking to “significantly increase coal exports to international markets.”
The acquisition is not without controversy. Shortly after finalizing the purchase, NTEC closed the Montana mine, Spring Creek, citing a legal impasse with Montana’s Department of Environmental Quality. The closure put about 280 employees out of work.
The state’s Department of Environmental Quality denied the Farmington-based company a permit earlier this month over concerns NTEC would not fully back mining bonds – often used to cover the environmental liabilities of a mine.
Because of the company’s connection to the Navajo Nation, sovereign immunity could prevent the state from taking legal action against the company in Montana courts, the Department of Environmental Quality argues. The department said it needs to be able to enforce its laws and regulations for coal producers, especially when it comes to reclamation bonding.
After a few months of negotiations, NTEC said talks broke down when the department demanded the complete waiver of the company’s sovereign immunity. This ultimately resulted “in the immediate and indefinite shuttering of operations at Spring Creek Mine – putting employees out of work,” the company said in a public statement. According to the company’s announcement, it had previously agreed to a partial waiver, allowing state regulations and laws.
Tim McLaughlin, chairman of NTEC, said the company is “shocked and disappointed” the state has taken this course of action. “We have done everything in our power to ensure (Montana) that we will operate under their laws, but we simply cannot consent to a full waiver of the rights preserved in our treaties – to do so would put the foundations of Indian Country at great risk,” he said in a written statement.
NTEC has gained the support of tribal nations located in Montana, too. Carlson Goes Ahead, vice chairman of the Crow Tribe of Indians, wrote a letter to Montana Gov. Steve Bullock asking the state to “maintain consistency in its relations amongst tribes” and to show the Navajo Nation company the “respect it has shown to tribal nations within the state.”
In addition to its new operations in the Powder River Basin, NTEC purchased Navajo Mine, south of Farmington, in 2013. Navajo Mine has supplied coal to the Four Corners Power Plant for the past 50 years.
The company also announced it will be moving its corporate headquarters to Broomfield, Colorado, to be more centrally located.
lweber@durangoherald.com