A federal appeals court has struck down a moratorium on new leases for mining coal on federal land that goes back to the final days of the Obama administration. The decision is unlikely to have much impact in light of the diminishing role of coal in the U.S. economy.
In an unpublished decision, a three-judge panel of the Ninth Circuit Court of Appeals lifted a 2022 order by the U.S. District Court for Montana that approved an Interior Department hold on new coal leasing. The appeals court remanded that order back to the Montana federal court, ordering it to dismiss the case as moot.
The case began in January 2016, when Obama Interior Secretary Sally Jewell ordered the Bureau of Land Management to perform an environmental impact statement and put a moratorium on new coal leases. In 2017, incoming Trump administration Interior Secretary Ryan Zinke killed the ongoing environmental analysis and ordered coal leasing to resume.
Environmental groups, the Northern Cheyenne Tribe, and the states of California, Washington, New York, and New Mexico intervened, challenging the Zinke order and its failure to provide an environmental analysis. Brian Morris, chief judge of the Montana District court, in 2019 ordered BLM to do a formal analysis under the National Environmental Policy Act and in 2022 ruled that the BLM analysis was faulty, halting new coal leases.
Before the final Morris order, new Biden administration Interior Secretary Deb Haaland “revoked” the Zinke order. She specifically said the revocation did not constitute a resumption of the Obama leasing moratorium.
When Morris issued his final 2022 ruling, Wyoming, Montana, and the National Coal Association filed suit in the appeals court, arguing that Haaland’s revocation of the Zinke order without adopting the Obama moratorium rendered the Montana decision moot.
“Nothing about the Zinke Order can be changed through further NEPA analysis when the Zinke Order is legally non-existent.” Ninth Circuit Court of Appeals
The appeals court panel agreed, concluding, “This lawsuit only concerns the Zinke Order’s recission of the Jewell Order’s moratorium on federal coal leasing. But the Zinke Order was “revoked” in April 2021. Nothing about the Zinke Order can be changed through further NEPA analysis when the Zinke Order is legally non-existent.” The judges also noted “what appears to be the government’s present adherence to a de facto moratorium.”
The impact of the ruling may also be effectively moot for the coal industry. The U.S. coal industry is in steep decline, largely as a result of the rapid rise in production of natural gas through hydraulic fracking and the concern about carbon dioxide emissions. According to the Energy Information Administration, U.S. coal production has fallen from 1,172 million tons in 2008 (when the fracking revolution began) to 594 million tons in 2022. Production west of the Mississippi, where the bulk of coal used in electric power plants originates, fell from 678 million tons to 352 million tons over the same period.
Fifteen years ago, coal accounted for 50% of U.S. electric generation. In 2022, according to EIA, natural gas had 43% of the generation market, renewables (hydro, solar, wind) were at 29%, and coal had fallen to 17%. Petroleum accounted for 2%.
An illustration of the decline of coal comes in Wyoming’s Powder River Basin, long the most important coal-producing area in the country, with giant strip mines hauling low-Btu coal from thick seams. Cowboy State Daily reported earlier this month (Feb. 16) that St. Louis-based Arch Resources is considering selling its giant Black Thunder and much smaller Coal Creek mines in the Wyoming basin, as sales decrease.
In 2014, Black Thunder sold 101 million tons of subbituminous coal. Last year, Black Thunder sales totaled 60.6 million tons. John Drexler, Arch chief operating officer, said the company is looking at 50-56 million tons of production this year out of Wyoming. Four years ago, a planned merger of Arch and another coal giant, Peabody Energy, for a joint Powder River Basin venture was scrapped after regulators said it would reduce competition.
In a February telephone meeting with Wall Street analysts, Arch CEO Paul Lang said, “I think there is a diminishing role in the U.S. for coal.”
–Kennedy Maize