trending Market Intelligence /marketintelligence/en/news-insights/trending/-qEPO_AjRYaso1wQYkUN2g2 content esgSubNav
In This List

Mining interests, BLM push back against environmental lawsuit over coal leases


Highlighting the Top Regional Aftermarket Research Brokers by Sector Coverage


Activity Volumes Across the Equity Capital Markets Dropped Significantly in 2022


Insight Weekly: PE firms shift strategies; bank earnings kick off; bankruptcies plummet

Case Study

A Large Energy Company Manages its Exposure with Robust Tools to Assess Creditworthiness and Set Credit Limits

Mining interests, BLM push back against environmental lawsuit over coal leases

Mininginterests and the nation's leading coal producer this week fired back againstenvironmental groups suingover federal coal leases, claiming that the groups cannot prove injury fromalleged failure by the government to consider climate-change impacts inapproving the leases.

Thegroups, including Wildlife Guardians and the Sierra Club to the U.S. Court of Appeals forthe 10th Circuit to hear their challenge to a ruling that supported leases forthe South Hilight, North Hilight, South Porcupine and North Porcupine tracts inthe Powder River Basin. TheU.S. Bureau of Land Management issued the leases in 2012, "opening thedoor for companies to strip-mine more than 2 billion tons of new coal,"which will lead to climate change, the groups said.

Inresponse to the appeal, PeabodyEnergy Corp. and other western coal mining interests argued thatthe groups could not prove that any alleged impacts on global climate changewould be felt locally, impacting their enjoyment of local aesthetics.

"Afterall, the groups do not claim injury on appeal as a result of climate change; noris there any showing in the record that climate change has caused concrete andparticularized injury at the affected geographic location. They therefore lackstanding," Peabody said in a filing April 4 with the court.

TheBLM also filed a response to the lawsuit April 4 saying that the four leaseswere "thoroughly examined" with respect to greenhouse gas emissionsfrom burning all the coal reserves prior to issuing the leases.

"BLManalyzed and disclosed the full scope of greenhouse-gas emissions, reasonablyconcluded based on considerations, including duration of the mine-lifeextension as well as information about market dynamics available at the time,that the demand for coal fired generation of electricity would likely beunaffected," BLM said.

Thegroups said they objected to the agency's "perfect substitution"assumption that the same amount of coal would be consumed regardless of whetherBLM issued the leases.

"President[Barack] Obama and Secretary [of the Interior Sally] Jewell took a huge stepforward to protect our climate when they announced the comprehensive review ofthe federal coal leasing program," Bill Corcoran of the Sierra Club said inan April 5 release.

"Butlawyers defending BLM continue to deny that the largest leases in the historyof the federal coal leasing program have any impact on our climate — and thatis flat out wrong. … Thisrigid adherence to policies of the past shows how out-of-step BLM is with therest of the Obama Administration on climate, even after President Obama andSecretary Jewell demonstrated a real commitment to addressing the causes andconsequences of climate disruption," he added.

TheBLM said its own environmental review of the leases explained that "whilethe scientific community is in substantial agreement as to climate change, thereare 'uncertainties regarding how climate change may affect different regions.'"

However,the agency said it did not analyze "specific incremental impacts toclimate change" from the challenged mining operations "because the scientificmethods to predict the incremental degree to which the leasing decisions mayimpact global climate change and local climate conditions were not availablewhen BLM conducted its analysis."

Environmentalgroups have taken issue with the agency's stance in the face of a federal pushto keep fossil fuels in the ground. In January, the Obama administrationannounced a pause onall new federal coal leases while it reviewsits program's methods for reviewing environmental and health impacts as well asits valuation of coal owned by the federal government. Among the options beingexplored is a 50% hikein royalty payments for some U.S. producers.