But Sweeney said coal production regions are defined by areas where there are several companies interested in leasing tracts. “That’s why it was decertified, and that’s why it stayed decertified,” she said of the Powder River Basin. “Look at the interest of new companies; you’re not seeing that.”
For now, the market appears to be rewarding the handful of companies operating there when they obtain leasing rights at a low cost. Cloud Peak Energy’s stock price rose 4.8 percent in a single day last year when it obtained a federal lease for a lower-than-expected price, and the target price was raised 19 percent by analysts.
“I don’t really blame the companies, though they’re complicit in it,” said Mark Squillace, director of the Natural Resources Law Center at the University of Colorado Law School. ”They’re taking advantage of what the government is allowing them to do.”
By contrast, Montana leases state mineral rights in the Powder River Basin by subjecting its price appraisals to public comment before accepting bids.