The Energy Blend: The state of coal Routt County’s industry | CraigDailyPress.com

The Energy Blend: The state of coal Routt County’s industry

Matt Stensland

Peabody EnergyPeabody Energy, owners and operators of the Twentymile Mine in Routt County, faced with a mountain of debt, filed for Chapter 11 bankruptcy April 14, creating uncertainty in communities that depend heavily on the energy giant for jobs., owners and operators of the Twentymile Mine in Routt County, faced with a mountain of debt, filed for Chapter 11 bankruptcy April 14, creating uncertainty in communities that depend heavily on the energy giant for jobs.

Peabody Energy, owners and operators of the Twentymile Mine in Routt County, faced with a mountain of debt, filed for Chapter 11 bankruptcy April 14, creating uncertainty in communities that depend heavily on the energy giant for jobs.

Peabody owns the Twentymile, an underground coal mine, and officials confirmed Aug. 9 that the company employs about 300 people at Routt County mine.

With about two-thirds of its employees residing in Moffat County, the economic impacts of Twentymile extend across county lines.

In an email to State Rep. Diane Mitsch Bush, sent this spring from Peabody's director of state government relations, Mike Blank, said, "Employees will continue to receive customary wages and salaries, healthcare coverage and other benefits upon court approval, which we expect to come quickly to allow us to continue to operate in the ordinary course."

Peabody started cutting U.S. jobs in June

On June 9, the Craig Daily Press reportedJune 9, the Craig Daily Press reported that Peabody has announced a plan to save roughly $40 to $45 million a year by cutting 250 salaried positions within the entire worldwide company “to create a leaner organization with lower costs.” that Peabody has announced a plan to save roughly $40 to $45 million a year by cutting 250 salaried positions within the entire worldwide company "to create a leaner organization with lower costs."

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June 9, the Craig Daily Press reported that Peabody has announced a plan to save roughly $40 to $45 million a year by cutting 250 salaried positions within the entire worldwide company "to create a leaner organization with lower costs."

The cuts will be carried out later this year. It's not clear if or how the cuts will affect Twentymile.

Peabody's Routt County property tax bill goes unpaid

Mining occurs under about 40 square miles of property owned by the mine and as a result Twentymile pays the most property taxes in Routt County, according to Assessor Gary Peterson.

In Routt County, Peabody has historically paid its property taxes in two installments. The second installment of 2015 taxes was tied up in bankruptcy court.

Steamboat Today reported on June 20Steamboat Today reported on June 20 that the $1.04 million in property taxes due to the South Routt School District posed a potential and almost immediate crisis, but that was forestalled by a $1 million loan from the Colorado Department of Education. And Routt County advanced a loan to the South Routt Medical Center to keep its doors open. that the $1.04 million in property taxes due to the South Routt School District posed a potential and almost immediate crisis, but that was forestalled by a $1 million loan from the Colorado Department of Education. And Routt County advanced a loan to the South Routt Medical Center to keep its doors open.

Steamboat Today reported on June 20 that the $1.04 million in property taxes due to the South Routt School District posed a potential and almost immediate crisis, but that was forestalled by a $1 million loan from the Colorado Department of Education. And Routt County advanced a loan to the South Routt Medical Center to keep its doors open.

Routt County Treasurer Britta Horn declined to accept the second portion of 2015 property taxes due in January 2015 from Peabody's Twentymile coal mine when Peabody's offer to pay its overdue taxes did not include an offer to include interest on the $1.77 million, which accrues at 1 percent per month.

Horn said Peabody's bankruptcy lawyers offered to pay the original tax bill only if she agreed to an unsecured claim (as opposed to a claim secured by hard assets) to cover the interest and fees. Horn wrote that, all too often, that results in the creditor receiving pennies on the dollar.

Horn added that Colorado treasurers are only authorized to waive interest or fees of less than $50.

"Bankruptcy law requires Peabody to pay all taxes that accrue while Peabody is in bankruptcy," Horn said.

In response to a request for an interview by the Steamboat Today with Twentymile General Manager Pat Sollars on Aug. 10, Peabody Vice President of Corporate Communications Beth Sutton replied: "We have court approval authorizing payment of $1.8 million in Routt County property taxes and look forward to reaching agreement with the treasurer's office on the process, as we have already done with most jurisdictions where we operate."

"My office is treating Peabody Energy like any other taxpayer that has delinquent taxes due. I welcome Peabody to pay their delinquent taxes with all the interest accrued and fees. To date, Peabody is unwilling to do so," Horn said.

More details of the delinquent property taxes including full text of pertinent email exchanges and documents are available at Steamboattoday.com using the search term "Peabody taxes."

Peabody dam project is done for now

Peabody Energy has backed away from plans to build the 400-acre Trout Creek Reservoir about 15 miles southwest of Steamboat Springs that would have provided a reliable water source for mining operations as reported on Aug. 25 in the Steamboat TodayAug. 25 in the Steamboat Today. .

Aug. 25 in the Steamboat Today.

The Trout Creek Reservoir would have stored about 12,000 acre-feet of water and would have cost an estimated $16 million to build and would have provided a permanent source of water for coal washing at its nearby mines.

Because the plan also included a proposed hydroelectric dam that would generate 125 kilowatts of electricity, Peabody was seeking approvals from the Federal Energy Regulatory Commission, or FERC.

In 2015 Peabody asked for a two-year extension in the permitting process so the company could conserve cash and reduce debt.

In August, FERC released a letter stating it was terminating the licensing process because Peabody had missed deadlines.

Peabody could always restart their efforts if the time is right. More information about the project is provided on the Steamboattoday.com website using the search terms "Peabody Reservoir."

Financial resources for reclamation secured from Peabody

The mining company posted bonds to ensure its Twentymile Mine in Routt County gets reclaimed in the event it was to close.

Bonds were posed in response to the WildEarth Guardians environmental group threat to sue Peabody on the basis that the company no longer had the finances to clean up its mines in New Mexico, Wyoming and Colorado, as reported on Feb. 23 by the Steamboat Today reported on Feb. 23 by the Steamboat Today. .

reported on Feb. 23 by the Steamboat Today.

To reclaim its mines, Peabody had historically been allowed to self-bond. That means Peabody could use its own assets to guarantee the money was available to reclaim its mines.

Guardians claimed Peabody no longer had the assets to self-bond.

On April 11, the Colorado Division of Reclamation Mining and Safety informed the federal regulators that it had received corporate surety bonds from Peabody to cover the full reclamation liability for its Colorado mines, as reported on April 29 by the Steamboat Today.April 29 by the Steamboat Today.

April 29 by the Steamboat Today.

To reach Matt Stensland, call 970-871-4247, email To reach Matt Stensland, call 970-871-4247, email mstensland@SteamboatToday.com or follow him on Twitter @SBTStensland

To reach Matt Stensland, call 970-871-4247, email mstensland@SteamboatToday.com or follow him on Twitter @SBTStensland

To reach Tom Ross, call 970-871-4205, email To reach Tom Ross, call 970-871-4205, email tross@SteamboatToday.com or follow him on Twitter @ThomasSRoss1 To reach Tom Ross, call 970-871-4205, email tross@SteamboatToday.com or follow him on Twitter @ThomasSRoss1