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Westmoreland, Crow tribe seal tonnage deal

THE FUTURE of Westmoreland Coal's Absaloka mine in Montana is even brighter after it signed a dea...

Donna Schmidt
Westmoreland, Crow tribe seal tonnage deal

According to an Associated Press report, the two held a signing ceremony in Crow Agency on Thursday afternoon.

Under the agreement the tribe will receive $12.5 million in bonus and advance royalty payments over the next four-and-a-half years.

The area in Treasure and Big Horn counties covers an estimated 14,000 acres.

The deal is an extension of a very longstanding partnership between the producer and the Crow tribe, as Westmoreland has leased coal reserves from the tribe since 1974.

The lease, which is subject to Bureau of Indian Affairs and Bureau of Land Management approval, will allow Westmoreland to control 357Mt of coal reserves and resources.

Westmoreland president Robert King told the AP that the agreement was another positive turn for it as well.

He said Absaloka production was sliced by about half after one of its client power plants went offline.

The facility, which was reportedly undergoing repairs, was expected to return to service, allowing Westmoreland to return to its 5.5 million ton per annum rate.

The latest tonnage addition will add another 20 years onto Absaloka’s lifespan.

Crow tribe chairman Darrin Old Coyote told the Billings Gazette it was working with tribes in the northwest to open additional export avenues that would send coal to Asian markets.

“All these good days will continue if we open up those ports,” Old Coyote said, noting the tribe was also working with clean coal partners to restart the long-dormant Many Stars project.

He thanked both sides for their work to bring the plan to its final stages.

“This never would have happened without the legislative branch,” he said.

“They were part of the process all the way through.”

According to the Gazette, King told the ceremony crowd that the company’s hope was to increase production.

“With higher production our costs decrease and we can be competitive,” he said.

“The bottom line is we have to be competitive with the Powder River Basin in Wyoming.”

About two-thirds of the mine's 118 employees were members of the Crow tribe, King said.

He hopes to be able to add another 30 to that total by the end of the year if the Sherco plant, which it services, is fully operational.

“I’m committed to increasing mine production and I’m committed to increasing jobs for the Crow tribe and in the region,” King said.

Absaloka, located near Hardin, is a single-pit complex expressly developed to supply PRB coal to a group of Midwestern utilities.

Its capacity is up to 7.5Mtpa, according to the Westmoreland website.

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