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Usibelli loses a round in ongoing battle over Alaska coal mine permit

A federal agency has ordered an inspection of the permit for a planned coal mine in Alaska, siding with environmental groups that say the permit is invalid and should be terminated.

Usibelli Coal Mine Inc. obtained a permit in 1991 to conduct surface mining operations at its Wishbone Hill mine but did not start mining there until 2010. Under federal law, "a surface mining permit terminates by operation of law if mining operations have not commenced within three years of permit issuance unless an extension has been granted in accordance with the statute."

Alaska's Department of Natural Resources granted Usibelli several extensions by implication, but the federal Office of Surface Mining Reclamation and Enforcement told DNR in a Jan. 17 letter that it erred by granting those extensions and has failed to take appropriate enforcement action to correct Usibelli’s violation of the law.

"OSMRE orders, therefore, that a federal inspection be conducted on those permits," the letter stated.

"We are pleased with this decision," Brook Brisson, senior staff attorney for Trustees for Alaska, told S&P Global Market Intelligence. "This is what the law requires. This decision protects the community from unpermitted coal mining. The Matanuska Valley is not a place for a coal strip mine."

Trustees for Alaska represented several environmental groups that joined with the Chickaloon Village Traditional Council in an effort to have Usibelli's permit terminated.

The Wishbone Hill mine has about 14 million tons of identified reserves, according to Usibelli's website.

Usibelli and DNR did not immediately respond to requests for comment.