ePlanning DOI-BLM-CO-S010-2019-0003-EA (Dunn Ranch Area Lease-by-Application and Mine Plan Modification)  
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08/06/2019 09:31:24 MDT

  King II Dunn Ranch Area Coal Lease-by-Application      
  & Mine Plan Modification      
  WHO:  GCC Energy, LLC (GCCE) proposes to expand its existing King II Coal Mine, an underground coal mine located in La Plata, County, Colorado. The expansion is proposed to occur beneath lands immediately north and northwest of the north boundary of GCCE’s existing federal lease (COC-78825) and mine workings.  To do this, GCCE would first need to obtain a new federal coal lease from the Bureau of Land Management (BLM) through a competitive lease sale process.

The initial step to obtain a new lease is to submit a coal lease by application (LBA) to the BLM, which GCCE has already filed with the agency.  If BLM approves offering the new coal lease for competitive sale and if GCCE is then the successful bidder, then the Office of Surface Mining Reclamation and Enforcement (OSMRE) would make a recommendation to the Assistant Secretary of Land and Minerals Management (ASLM) to approve, disapprove, or approve with conditions the proposed mining plan modification.

WHERE:  The LBA area is located between 3.5 and 6.5 aerial miles west-southwest of the town of Hesperus in La Plata County, Colorado.  The boundaries of the LBA and surface land ownership are shown in Map 2 (available through the Maps page link at left).

The proposed project area consists mostly of split-estate federally owned coal, with a mixture of surface estate owners, including the Ute Mountain Ute Tribe, Devil’s Canyon Trust, C & C Livestock, Shirard Colorado LTD Partnership, and the BLM.  The majority of this surface acreage is fee-restricted land owned by the Ute Mountain Ute Tribe.  In addition, about 204 acres of non-federal coal would be mined beneath about 479 acres of Ute Mountain Ute surface.  Approximately 366 acres of federal coal in the LBA beneath three isolated private surface areas will be regulated under a memorandum with the Colorado Division of Reclamation, Mining, and Safety (CDRMS).  There are no occupied structures above the proposed mine area.

The legal description for the proposed King II Coal Mine Dunn Ranch Area LBA is:

New Mexico Principle Meridian
Township 35 North, Range 11 West
Section 18: lots 2 thru 5, 8, 9, 10, SE ¼ NW ¼, NE ¼ SW ¼:
Section 19: lots 1, 2, 6, and 7, NE ¼ NW ¼, N ½ SE ¼ NW ¼.
Township 35 North, Range 12 West
Section 13: S ½ NE ¼, SE ¼ NW ¼, S ½ SW ¼, NE ¼ SE ¼, and S ½ SE ¼;
Section 14: S ½ NE ¼ SW ¼, S ½ NW ¼ SW ¼, S ½ SW ¼, S ½ NW ¼ SE ¼, and S ½ SE ¼;
Section 15: SE ¼ SW ¼ and S ½ SE ¼;
Section 22: N ½ NE ¼, N ½ SW ¼ NE ¼, SE ¼ SW ¼ NE ¼, SE ¼ NE ¼, E½ NE ¼ NW ¼, NE ¼ SE ¼ NW ¼, and E ½ NW ¼ SE ¼;
Section 23: N ½ NE ¼, SE ¼ NE ¼, N ½ NW ¼, SE ¼ SW ¼, and SE ¼;
Section 24: N½, SW ¼, and NW ¼ SE ¼;
Section 26: N ½ NE ¼ NE ¼, SW ¼ NE ¼ NE ¼, NW ¼ NE ¼, N ½ NW ¼, N½ SW ¼ NW ¼, SE ¼ SW ¼ NW ¼, and SE ¼ NW ¼;
Section 27: NE ¼ NE ¼, and SE ¼ NW ¼ NE ¼

The Dunn Ranch Area LBA contains 2,462.07 acres more or less.

WHAT:  The proposed action would result in a continuation of operations at the King II Coal Mine with expanded underground acreage, and approximately the same production rates and traffic.  It would extend the life of the mine by approximately 22 years.  If authorized, the project would result in a total of about 20 acres of new surface disturbance over a 2,462-acre lease area known as the “Dunn Ranch Area.”
  The temporary surface disturbance would primarily be associated with construction of a “low cover crossing” (an engineered, below-grade steel-lined haulage way) that would connect the existing mine to the LBA area and allow underground mining equipment (vehicles, utilities, conveyors, ventilation ducts, etc.) to pass beneath East Alkali Gulch without coming to the surface.  The low cover crossing would be constructed at the southwest end of the existing mine workings.  Surface facilities at the existing King II Coal Mine would not change.  Map 2 (on the Maps page) is a topographic map showing the location of the proposed low cover crossing relative to existing leases and mine features and the proposed lease by application area.

Coal would continue to be mined using the “room and pillar” method followed by retreat mining to ensure maximum recovery.  The coal would be mined using continuous miner machinery to mine coal at the face and convey it underground via belt to the existing surface facilities for cleaning, sorting and shipment.  Mining rates are presently approximately 600,000 tons per year, with a planned annual output of up to 1.1 million tons.  GCCE’s conceptual mine plan proposes a mining rate of about 800,000 tons per year for most of the life of the mining in the LBA. 

All coal is transported from the mine via truck, with a maximum daily average of 120 trucks per day.  At the present production rate, 67 percent (421,000 tons per year) of the coal is delivered to GCC of America (GCC)-owned cement plants in the U.S. and Mexico where the coal is used as a fuel source in the cement manufacturing process.  These plants are in Pueblo, Colorado (105,000 tons per year), Tijeras, New Mexico (76,000 tons per year), and in Chihuahua and Samalayuca, Mexico (240,000 tons per year).  Deliveries to the cement plants in the U.S. are directly trucked from the King II Mine.  Coal delivered to GCC’s Mexico cement plants are delivered via rail from the Gallup, New Mexico rail hub.  An additional approximately 12,000 tons per year are delivered to the Durango & Silverton Narrow Gauge Railroad (3,600 tons per year), the Cumbres and Toltec Scenic Railroad in Chama, New Mexico (1,500 tons per year), and locally (7,000 tons per year) for home heating.  On average, approximately 448,785 tons per year (including the GCC Mexico cement plant volumes) is transported by truck to the rail terminal in Gallup, New Mexico for delivery to GCC plants in Mexico and to variable cement plant buyers in the Southwest (depending on markets, alternative fuels, and coal supply).

This LBA EA incorporates by reference analysis from two previous environmental assessments conducted by the BLM for GCCE: 
DOI-CO-S010-2014-0025-EA - GCC Energy Proposed Exploration License Application COC-76563 (September 13, 2016)

DOI-CO-S010-2011-0074-EA - Federal Coal Lease COC-62920 Modification and Federal Mine Permit (CO-0106A) Revision and Renewal

WHEN:  A BLM decision on whether to lease would be expected in late Summer 2019, followed by a competitive leasing process.  If the BLM decides to lease the property, and GCCE is the highest qualified bidder, then OSMRE would recommend whether to approve the mining plan modification to the ASLM in Winter 2019/2020.  Construction could begin in 2020 and mining at the King II Coal Mine would likely continue for an additional 22 years.

The BLM and OSMRE held a 30-day public review and comment period on the Preliminary Environmental Assessment.  Comments were accepted electronically through the Documents page of this project ePlanning site [https://go.usa.gov/xEKTV] and must have been received by August 5, 2019. Comments were also accepted via U.S. postal service to the BLM Tres Rios Field Office and OSMRE Western Region.

By including your address, phone number, email address, or other personally identifying information in your comment, you should be aware that your entire comment, including your personally identifying information, may be made publically available at any time.  While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.

The Federal Register Notice of Availability and Public Hearing is available online at:
The Preliminary EA, along with maps and other pertinent information, is available on the Documents page of this ePlanning site, and at OSMRE’s website at: https://www.wrcc.osmre.gov/initiatives/kingIICoalMine.shtm.

Additional documentation, including decision documents, will be posted on these sites as they become available. 

JULY 24, 2019
The BLM held a public hearing on Wednedsay, July 24 to receive public comments on the fair market value and maximum economic recovery of the federal coal in the LBA and on the Preliminary EA. An information session on the project and EA was held prior to the hearing at the same location.  The meeting was held at the BLM Tres Rios Field Office in Dolores, CO.

AUGUST 1, 2019
A second Open House was held on Thursday, August 1 at the Breen Community Building in Hesperus, CO.  BLM and OSMRE staff were available to answer questions about the proposed lease, mine plan modification, and Preliminary EA and to accept written comments on the Preliminary EA.