CASPER — A Navajo Nation-based coal operator reached an agreement with the U.S. government on Saturday, giving federal regulators the authority to enforce environmental laws at a former mining site in Tennessee.
As a tribal entity established under Navajo Nation law, Navajo Transitional Energy Company, or NTEC, has the right to sovereign immunity, or the ability to potentially shield itself from U.S. federal jurisdiction.
When NTEC purchased assets owned by Wyoming-based coal company Cloud Peak Energy last year, it acquired three coal mines in the Powder River Basin as well as mining properties in Tennessee. Saturday's limited waiver of sovereign immunity only applies to the Sequatchie Valley Mine in Tennessee. It does not include the Antelope and Cordero Rojo mines in Wyoming, or the Spring Creek mine in Montana.
Environmental regulators in Wyoming and Montana have primary authority to enforce mining laws at the three Powder River Basin mines. Given Tennessee does not have a similar regulatory authority, the U.S. Office of Surface Mining Reclamation and Enforcement oversees the enforcement of federal law at mining facilities in the state.
Under the agreement reached with the federal government Saturday, NTEC agreed to a limited waiver of this sovereign immunity — a step that brings NTEC one step closer to securing permits for reclamation of an inactive mine in Tennessee.
The waiver allows the U.S. Office of Surface Mining Reclamation and Enforcement to hold NTEC accountable to applicable federal mining and environmental laws, including the Surface Mining Control and Reclamation Act. The announcement came less than two weeks after NTEC established a similar agreement with Wyoming regulators.
“NTEC appreciates the diligence of (the Office of Surface Mining, Reclamation and Enforcement) and (the Department of Interior) in moving this process forward,” Clark Moseley, CEO of the coal company, said in a statement. “We especially thank Secretary (David) Bernhardt for understanding the important role mining plays in our economy, while also respecting the sovereignty of NTEC as a tribal entity.”
Several critics of last year's major coal sale worried NTEC would have the power to skirt state and federal environmental laws when operating mines outside the Navajo Nation if it did not agree to waive its sovereign immunity.
The sale of Cloud Peak Energy's assets to the out-of-state company prompted significant speculation from energy analysts last year. Many hoped to understand the motivations behind the ambitious acquisition, which made NTEC the third largest coal company in the nation. The purchase has also been met with both optimism and criticism on the Navajo Nation.
NTEC offered to shoulder about $94 million in liabilities from the mines’ former owner when it bought the mines, including millions of dollars in outstanding federal royalties, as well as state and county taxes. It will also be responsible for future reclamation, or cleanup, responsibilities at the sites once the permits transfer. But NTEC has stood by its decision, asserting its benefits for both the Navajo Nation and the U.S.