Usibelli has held permits for the site since the 1990s and has already conducted exploration and environmental research in preparation for a feasibility study.

The mine’s permits currently up for renewal are open to public comment until mid-October and have attracted enough citizen complaints to spur reaction from federal authorities.

OSM official Kenneth Walker reportedly told the Alaska Department of Natural Resources in a letter dated last week that granting of the Wishbone Hill permits was not supported by the facts or applicable law.

The Associated Press said Walker requested any additional information on the renewals and extensions to provide clarity with regard to their validity.

The delay in the permitting process has prevented Usibelli from continuing development work at Wishbone Hill this summer and the miner has been barred from doing any work on the site until the permit issue is resolved.

Usibelli has responded by saying federal regulators are trying to bully the state of Alaska by second-guessing local permitting decisions that were made 16 years ago.

Although Usibelli has yet to determine the feasibility of the project, interest in resurrecting the historic coal mining area has attracted the attention of Japanese power company JPower and an Australian company called Riverdale Alaska.

Riversdale won a bidding war for 45sq.km of coal-bearing land in the nearby historic coal mining site of Chickaloon.

Although the 41sq.km Wishbone Hill claims only 14 million tons of identified coal reserves, Usibelli says the tenement has considerable value as the only bituminous deposit on the Alaskan road system.