Chuitna coal mining



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  • Chuitna coal mining

    Yet another energy issue that deserves some attention. I just listened to the Kenai Borough Assembly taking testimony on an issue regarding the possibility to renegotiate a lease that relates to coal mining opportunities in the Chuitna River drainage.

    Several assembly members were obviously frustrated by the appearance of the lack of understanding on the issue that was before them. Most testimony was anti-coal and anti-coal at this location, problem is the assembly is not in a position to say no coal at this location because of a decision made over 20 years ago.

    The issue that is actually before them now is that the OPTION to lease land/ access to the mining company is going to expire. Meaning the mining company can enter into the lease as it was drafted over 20 years ago or they could walk away. They almost certainly would not walk away. Its a 50 year lease, if they took the lease as written, there is little change in cost to their company compared to what they've been paying to keep the option to lease open.

    What the borough government is hoping to do is to extend the option to lease for another 5 years and renegotiate more modern terms with the mining company. However both the government and the mining company must BOTH agree to the revised terms otherwise the deal reverts to the existing 1980s terms.

    So the way I see it is there is no advantage to extending the option to lease, if the mining company wants it, they'll take it and the 50 year lease clock starts. If both parties want to change the terms of the 50 year lease, whats to stop them once the lease is active? If both parties to a lease agree on changes, it would seem pretty simple to do, whether it is open and active or simply retained as an option to lease.

    Why postpone for another 5 years what could be done now or at anytime in the next 50 years while the lease is active? And why in the world would anyone want to postpone a 50 year lease for more than 20 years - this has turned into a 70+ year deal. 70 year time frames for these types of projects seem not to be in the best interest of the people.

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