Closed mine north of Fruita tries to expand

After Cameo Power Plant shutdown, coal producer wants to reach eastern markets

A company with a coal mine north of Fruita that was closed because of the shutdown of the Cameo Power Plant is continuing to seek approvals to add acreage to that mine and open a much bigger operation nearby.

A subsidiary of Rhino Energy LLC used to mine and truck about 280,000 tons of coal a year from the McClane Canyon Mine to the power plant. McClane Canyon Mining LLC has been seeking Bureau of Land Management approval to lease an additional 320 acres with the idea of being able to produce 500,000 tons a year. That would justify the costs of building a rail load-out and coal-cleaning facility west of Fruita that would enable it to ship the coal to eastern markets.

Meanwhile, another Rhino subsidiary, CAM-Colorado LLC, has been seeking BLM approval to lease 11,600 acres east of the existing mine for the proposed Red Cliff Mine. Rhino, which holds other leases in the area, hopes to open a mine producing 6 million to 8 million tons of coal a year and employing 200 to 250 people.

Rhino’s holdings are on the Garfield/Mesa county line. With the job prospects at stake, Garfield County Commissioner John Martin is voicing frustration with the BLM, contending it has engaged in delay tactics to keep the Red Cliff Mine from being able to open.

“It has been held up for years,” he said.

One apparent reason for the delay is that Arch Coal Inc. expressed interest in the same acreage that Rhino Energy wants to add. Arch Coal told the BLM that expanding the acreage under consideration would make the leasing process more competitive.

“I think the BLM, to their credit, actually slowed things down to make sure ultimately this becomes a more competitive process,” said Jeremy Nichols of WildEarth Guardians, who noted his group continues to have environmental concerns about the proposal.

The BLM denied a CAM-Colorado right-of-way application pertaining to things such as a proposed rail line to Fruita, saying it was premature when the lease hasn’t been approved. CAM-Colorado appealed to the Interior Board of Land Appeals, which has ordered the BLM to provide more information justifying its decision.

Meanwhile, the BLM asked McClane Canyon Mining to submit a revision of its proposal to address concerns such as those raised by the High Lonesome Ranch, which fears impacts on its ranching operations.


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