murky for Black Mesa Project
By Marley Shebala, Navajo Times
April 18, 2007
– A study to expand strip mining on Black Mesa may stall
for lack of money.
Southern California Edison and the Salt
River Project, two major stakeholders in the proposed
Black Mesa Project, are playing ping-pong over who’s
paying for an environmental impact study needed before
the expansion can take place.
The study required by federal law, is
being done under the auspices of the U.S. Office of
Surface Mining, but has been funded by the utilities.
On Mach 30, SCE reported to the California
Public Utilities Commission that it would fund the EIS
only until the end of April.
California Edison initially financed
the environmental review but pulled its funding in March
2006 after giving up efforts to reopen its shuttered
Mohave Generating Station, which burned Black Mesa coal.
Then SRP, one of several utilities that
own a minority share of Mohave, announced it would fund
the study wile putting together a deal to buy out Edison’s
share and reopen the plant under new management.
But on Feb. 6, SRP announced it was
giving up on Mohave, too.
Two weeks later, however, OSM Southwest
Regional Director Richard Holbrook announced that he’d
been notified that SCE would resume paying for the environmental
“They are still attempting to sell the
plant,” Holbrook explained at the time. “If they do
sell the plant, the new owners would want the EIS finished.”
Now, California Edison’s latest filing
with its regulatory agency shows that it is pulling
back again. Holbrook noted earlier that if the California
utility decided to discontinue funding, the federal
mining agency might pick up the cost.
On Wednesday, Holbrook was unavailable
for comment on the latest developments.
SRP stated in a Feb. 6 press release
that decided not to continue funding the environmental
review because couldn’t reach a purchase agreement with
California Edison for the shuttered power plant.
Coal for sale
Salt River’s announcement
came three days before OSM closed public comment on
the draft environmental statement for the proposed Black
Mesa Project, which calls for Peabody Western Coal Co.
to increase coal production from its Kayenta and Black
Mesa mines, pump more ground water, and send the coal
Mohave was the sole customer for coal
from the Black Mesa Mine, and Peabody has not offered
a new market for the coal.
The company is seeking to gain permanent
control of the coal reserves on Black Mesa through an
extension of its lease with the Navajo Nation and the
U.S. Department of the Interior.
Peabody, which just announced record
profits of $663 million for 2006, is the largest coal
company in the world and possesses over twice the coal
reserves of its nearest competitor, according to its
Its decision to close the Black Mesa
Mine when Mohave closed at the end of December 2005
threw over 100 mostly Navajo workers out of a job, but
was imperceptible on the company’s bottom line.
Coal sales increased 13 percent, income
was up 42 percent, and profits were up 28 percent, reaching
the highest levels in the company’s 124-year history.
According to investors, Peabody is in
such demand that the company announced a two-for-one
stock split in February 2006, barely a month after Black
Despite the absence of an alternative
customer for the Black Mesa Mine, both Peabody and President
Joe Shirley Jr.’s administration support completion
of the Black Mesa EIS.
A positive conclusion by the study would
lay the groundwork for Peabody to convert its 30-year
lease, which expired at the end of 2005, to an “end-of-mine-life”
lease on Black Mesa coal reserves.